Can I get car insurance for a car that is used for towing or hauling?

If you use your car for towing or hauling, you’ll want peace of mind that both your vehicle and cargo are covered by your car insurance coverage. There are several ways to insure your towing vehicle; knowing the difference is important. This article will explain car insurance for a car used for towing or hauling.

Why You Need Liability Car Insurance for Your Car Used for Towing or Hauling

Liability insurance coverage, also called auto liability coverage, is a type of car insurance coverage that financially protects you if you cause an accident that results in someone else’s injury or property damage. It comes standard with most auto insurance policies, though the amount of coverage varies by policy.

Liability insurance is required in almost every state in the U.S. Unless you live in New Hampshire or Virginia, which have rules on who can opt out of insurance. You need auto insurance with liability coverage to legally drive in the U.S. This applies whether or not you’re towing or hauling with your vehicle.

Liability Insurance When Hauling a Trailer

Your car’s liability insurance usually includes bodily injury and property damage liability insurance that helps pay for the other driver’s expenses if you cause a car accident. For these purposes, your liability insurance will usually cover both your car and any trailer you tow by your vehicle.

Most policies will stipulate that your trailer must be connected to the vehicle on your policy during any accident to receive coverage.

When Towing or Hauling Is Covered

The following must be true for your auto insurance company to cover your trailer:

• You own the trailer.
• You connect your trailer to an insured towing vehicle.
• Your trailer is a covered type of trailer.

Note that car insurance coverage can vary. You must ensure that your car insurance policy protects the types of trailers you intend to haul. You’ll want to be sure that your policy doesn’t come with additional requirements to those listed above.

Liability Car Insurance for Towing or Hauling

The next thing you’re probably wondering is how much car insurance you need. Ideally, you should choose an auto insurance policy with enough liability coverage to suit your needs.

A good rule of thumb is to find liability coverage that matches or exceeds the value of your vehicle. That way, you can rest assured that your assets are completely protected.

Personal vs. Commercial Car Insurance for Towing and Hauling

You may need commercial auto insurance depending on the type of cargo you’re hauling or how you’re using your vehicle to haul or tow. Understanding the difference between personal and commercial auto insurance should help you decide.

There are a few key differences between personal and commercial car insurance. The first is who owns the vehicle — if a business owns it, even your business, it must be covered by commercial auto insurance. Another big difference is that commercial auto policies cover higher claims and different types of vehicles.

Consider commercial car insurance coverage if you use your vehicle for the following purposes:

• Perform a service that you get paid for.
• Tow a trailer you use for business.
• Haul heavy equipment you use for work.
• Transport passengers or goods in your vehicle for a fee.

Read more: Can I get car insurance for a car that is used for business purposes?

If none of the above apply to you, you are probably safe sticking with personal auto insurance. However, if you’re on the fence, you may want to consider a policy that covers higher claims. You can never be too safe.

Case Studies: Car Insurance for Cars Used for Towing or Hauling

Case Study 1: Comprehensive Coverage for Towing Vehicle and Trailer

David owns a pickup truck that he uses for towing a trailer to transport his equipment for his landscaping business. He wanted to ensure that both his vehicle and the trailer were adequately covered in case of an accident. David found a car insurance policy that provided liability coverage specifically for towing.

This coverage protected both his towing vehicle and the trailer, giving him the peace of mind he needed to run his business smoothly.

Case Study 2: Commercial Auto Insurance for Hauling Cargo

Rachel operates a small delivery business and uses her van for hauling cargo. She realized that her personal auto insurance policy did not provide adequate coverage for her commercial activities. Rachel decided to switch to a commercial auto insurance policy that specifically covered her vehicle for hauling cargo.

Case Study 3: Personal Liability Coverage for Towing a Boat

John owns a boat and uses his SUV to tow it to different lakes for recreational activities. He wanted to ensure that he had liability coverage in case of any accidents while towing his boat. John found a personal auto insurance policy that provided liability coverage for towing.

This coverage protected both his vehicle and the boat during towing, giving him the confidence to enjoy his boating adventures worry-free.

The Bottom Line: You Need Liability Car Insurance For a Car You Use for Towing or Hauling

With limited exceptions, you need auto insurance with liability coverage to legally operate your vehicle for towing or hauling in the U.S. When searching for a policy, ensure that it has liability coverage that offers enough protection to suit your needs.

Depending on your situation, you may consider commercial auto insurance or additional coverage for the cargo you’re hauling.