There are lots of potential risks that people who work with tow trucks face every day. Risks, or exposures, are why people get tow truck insurance in the first place—so that they’re protected from whatever life might throw at them.
As someone who works in the tow truck industry, it’s important that you understand what you’re up against. There are several types of risks that your business faces every day, so we’ve outlined the kinds of exposures that you need to be aware of when thinking about getting your insurance coverage. The exposures and risks depend on what kind of tow truck business you have (mainly whether you’re strictly towing or you have a body shop), but these are the main ones to think about.
1. Property exposures:
If your business repairs or refuels vehicles, then your property exposure is fairly high. Most of the risks are associated with fires, as there are many items in a repair area that might be inclined to combust. For example, flammable liquids (i.e. gas and diesel) pose a threat. Activities such as welding also cause a major risk—the high level of heat produced can lead to fire.
Theft can also be a property risk, particularly if you store things for your customers or if you keep their cars in your shop.
Tips to reduce property exposures:
- Have separate areas for any liquids liable to catch fire and repair work that involves creating lots of heat (like welding.)
- Provide a safe, ventilated booth for spray-painting.
- Make sure that any underground fuel tanks are maintained. Keep them in good repair.
- Be mindful of fire risks coming from any stored items that belong to customers.
- Keep the area clear and easy to navigate for firefighters so that they can respond quickly and safely in the event of a fire.
2. Crime exposures:
One of the main crime exposures is employee dishonesty, which is when one of your employees steals from your business or one of your customers. Money and securities are also an exposure, as they can be stolen.
- Conduct background checks on all employees who deal with money. Look into their criminal records, too.
- Have different people oversee different tasks (deposits, billing, ordering supplies, etc.) when it comes to handling money.
- Hold consistent internal and external audits.
3. Premises liability exposures:
These usually aren’t very high since people aren’t typically allowed on your property. Off-premises risks are connected to the use of the trucks themselves.
Tips to reduce premises liability exposures:
- Have plenty of outdoor lighting.
- Have a fence around your property.
4. Inland marine exposures:
As far as insurance goes, inland marine coverage protects cargo being transported over land and property that your customers leave in your care. It also protects you while your customer’s property is being moved to or from your premises. Inland marine exposures mainly come from the fact that you deal with your customers’ property. You haul their cars and you might also be required to keep their vehicles (or other belongings) on your premises, making them your responsibility. Accounts receivable (if you have credit), motor truck cargo, valuable papers and records, and warehouse operator’s legal liability are the main inland marine exposures your business might face.
Tips for reducing inland marine exposures:
- Have locked storage areas with alarm systems.
- Be sure to uphold the minimum legal requirements for cargo liability coverage.
- Have a clear system for labeling customer belongings in storage so that they aren’t given to the wrong people.
- Have copies of your records kept off-site in a secure location.
5. Environmental impairment exposures:
Fuel and the environment don’t mix very well, so environmental impairment exposures can be high because of underground storage containers used for gas or diesel. Another environmental concern is disposing of the liquids used when the tow trucks are being serviced.
Tips for reducing environmental impairment exposures:
- Ensure that your fuel tanks adhere to state/federal regulations.
- Regularly test the tanks for any leaks.
- Have a system to appropriately discard all hazardous chemicals.
- Have spill procedures so that no waste oozes from the water system.
6. Automobile exposures:
This is a big one. Your business probably loads and unloads lots of cargo, and this increases the risk of something happening to one of your workers or the property being moved. Then there’s all the risk that comes along with operating a tow truck on the roads.
Tips for reducing your auto exposures:
- Teach your drivers how to properly lift and carry heavy items.
- Be sure that your drivers have current commercial driver’s licenses. This will allow them to drive the trucks and handle the loads being towed.
- Check your drivers’ Motor Vehicle Records (MVRs) frequently to be sure they’re up to scratch.
- Driver’s logs are a must. Make sure that your drivers aren’t going over the limits for hours behind the wheel.
- Have random drug and alcohol tests.
- Keep your trucks in good repair.
7. Workers’ compensation exposures:
There are different risks for tow truck drivers and garage employees. Drivers are on the roads, sometimes in bad driving conditions. Loading and unloading cars and other cargo can cause back strains, sprains, hernias, and other injuries. Garage employees face the possibility that a vehicle could fall and injure them while it’s being lifted, and they’re also at risk for injuries associated with lifting. Various injuries such as burns can result from welding and painting, and the use of cleaning chemicals can cause skin problems. And of course, there’s always the chance of slips and falls.
Tips for reducing your drivers’ exposures:
- Sleep is essential. Make sure your drivers get enough time to sleep.
- Train your drivers well so that they’re comfortable using the equipment.
Tips for reducing your garage workers’ exposures:
- Keep the work area tidy and clean.
- Make sure there’s good ventilation in the vehicle servicing area.
- Always use the right safety equipment.
The risks might seem extensive, but we can help you manage your exposures and find the right coverage to protect you from them. It’s impossible to know what the future has in store, but understanding the potential risks that threaten your business is a big step towards being prepared for anything. Our agents have lots of experience with insuring tow trucks, so reach out to us today so that we can get to know you and your business. We can even get you a free quote.