Auto Insurance And Vehicle Transport: Understanding The Coverage Gap

If you're transporting a vehicle, it's important to understand how your auto insurance policy applies. Generally, if you're not driving the vehicle, your own car insurance may not be required during transportation by truck, ship, or rail. However, it's crucial to verify the coverage provided by the transport company's insurance policy. While they are legally required to carry insurance, the extent of coverage may vary.

To ensure peace of mind, it's recommended to check with your auto insurance provider to confirm if your policy covers your vehicle during transportation. In some cases, your insurance may act as a backup if there are issues with the transporter's coverage. It's also worth noting that comprehensive and collision coverage in your auto policy could protect you from damage to your vehicle during transit.

Additionally, consider purchasing supplemental insurance or obtaining additional coverage through your insurer, especially if you're transporting a high-value or antique vehicle. This will provide added protection in case of unforeseen circumstances. Remember to review the terms and conditions of any insurance policy carefully and consult with insurance professionals if needed.

What type of insurance coverage do auto transport companies provide?

Auto transport companies are required to provide basic liability insurance with the cost of shipping. This covers damage to other vehicles or property due to an accident involving their transport equipment. This type of coverage is critical for protecting all parties involved.

However, it is important to note that the transport company's insurance policy typically covers damage that occurs when loading your car, while the car is in transit, and when unloading the car. Everything else, including any damage caused because your car was in poor shape when you shipped it (e.g. leaking oil, loose parts, etc.), is your responsibility.

Auto transport companies may also offer additional coverage options during the booking process. Adding comprehensive insurance provides more extensive shipment coverage for any damages not covered under liability insurance.

Some auto transport companies also offer supplemental coverage for an extra fee. This can include gap coverage and cash toward your deductible.

When selecting a transport company, it is essential to ensure they have the appropriate levels of cargo insurance coverage. Choosing a carrier with inadequate cargo insurance coverage could lead to additional out-of-pocket expenses in the event of damage during transit.

It is also worth noting that auto transport insurance coverage requirements can vary by state, so it is important to ask for the transport company's insurance policy details.

Does my regular auto insurance cover shipping?

When shipping a car, it's essential to understand the insurance coverage provided by the carrier and your own auto insurance policy. Here's a comprehensive guide to help you navigate this process:

Auto Transport Insurance:

Firstly, it's important to know that auto transport companies are required by law to carry valid insurance. This insurance typically covers damage to your vehicle during the loading, transportation, and unloading process. However, it's crucial to verify the specifics of their coverage, including any exclusions and limitations. Ask for proof of insurance and inquire about their policy details, such as coverage amounts and what constitutes a covered incident.

Your Regular Auto Insurance Coverage:

Now, let's address the question, "Does my regular auto insurance cover shipping?" The answer may vary depending on your specific insurance provider and policy. While some policies may extend coverage to your vehicle during transportation, others may not. Therefore, it is imperative to contact your insurance company directly and inquire about the following:

• Does my auto insurance policy cover my vehicle during transport?
• If so, what specific risks are covered (e.g., damage, theft, etc.)?
• Are there any exclusions or limitations to this coverage?
• Is there a deductible for claims related to transportation, and if so, what is the amount?
• Will my coverage be sufficient for my needs, or do I need to consider additional insurance?

Additional Insurance:

Depending on the value of your vehicle and your risk tolerance, you may want to consider purchasing additional insurance or supplemental coverage. This can provide extra protection and peace of mind during the transportation process. Some auto transport companies offer this option, and it may be worth exploring their available plans.

Best Practices:

To ensure a smooth shipping process and adequate coverage, here are some recommended steps:

• Get everything in writing: Obtain written documentation of any special agreements or considerations from both the auto transport company and your insurance provider.
• Remove loose items from your vehicle: Most car shippers will not cover damage to the interior, so remove all removable items to reduce the risk of damage or theft.
• Conduct a pre-possession inspection: Before handing over your vehicle, document its condition by taking photographs and noting any existing damage. Repeat this process upon delivery and compare the vehicle's condition to identify any new issues.
• Understand the claims process: Familiarize yourself with the procedures for filing a claim in case of damage or loss during transportation, including the required documentation and timeframes.

In summary, while your regular auto insurance policy may provide some coverage during vehicle transport, it's crucial to verify this with your insurance provider and understand the specifics of their coverage. Additionally, ensure that your chosen auto transport company has valid insurance and supplement it with additional coverage if necessary. By following these steps, you can ensure that your vehicle is adequately protected during the entire shipping process.

What if my vehicle is damaged during transport?

If your vehicle is damaged during transport, the first thing to do is to refer to the auto transport company's insurance policy. All car shipping companies are required to provide basic liability coverage for damage to your car, but the specifics of these policies vary. Some companies may also offer additional insurance options for purchase. It is important to verify the insurance coverage and understand what types of damage are included before choosing a transporter.

Upon delivery, it is critical to thoroughly inspect your vehicle for any new damage. Check the exterior for scratches, dents, or chips, especially on the sides, roof, and undercarriage. Look for fluid leaks and ensure that the vehicle is running properly. If any damage is found, document it by taking photos and making detailed notes. Compare these to the pre-shipping inspection report and inform the driver or shipping company representative. Both parties should then sign off on a Bill of Lading or Condition Report, acknowledging the damage.

If the transport company accepts responsibility for the damage, they may offer to pay for the repairs out of pocket to avoid an insurance claim. Otherwise, you will need to file an insurance claim with their insurance company. Provide them with the photos and documentation of the damage, as well as an estimate for the repairs from your mechanic. Keep in mind that your personal auto insurance policy typically will not cover damage during transport, so it is essential to understand the transporter's insurance coverage beforehand.

To summarise, protecting your vehicle during transport involves careful research and documentation. Understanding the insurance coverage of the transport company, conducting thorough inspections, and promptly reporting any damage are key steps to ensuring a successful resolution in the event of any issues.

What should I ask an auto transport company about its insurance?

When you're looking to transport your vehicle, it's important to understand the different types of auto transport companies and their insurance policies. Here are some detailed questions to ask an auto transport company about its insurance:

• Verify the type of company: Is the company a broker or a carrier? Brokers act as middlemen, connecting you with carriers who transport your vehicle. Carriers, on the other hand, have their own fleet of trucks and directly ship your car. It's crucial to know the type of company you're dealing with when discussing insurance coverage.
• Carrier insurance: Ask about the carrier's insurance coverage. Find out if they have adequate insurance to cover any potential damage to your vehicle during transport. Verify their liability coverage limits and whether they can replace your vehicle if it's destroyed or stolen. Check if their insurance covers pickup, transport, and delivery, as some transporters only provide coverage when the vehicle is on the truck.
• Broker insurance: If you're working with a broker, inquire about their role in insurance. While brokers aren't required to offer insurance, some reputable brokers provide supplemental coverage or act as liaisons between you and the carrier in the event of a damage claim.
• Damage claims process: Understand how damage claims are handled. If your vehicle is damaged during transport, will you file the claim directly with the carrier or the broker? Ask about their process for filing and handling damage claims.
• Cargo insurance: Cargo insurance covers damage to the vehicle during transport. Clarify whether the cargo insurance coverage amount is per vehicle or for the entire load of vehicles on the trailer. This information is crucial in determining the actual coverage provided for your vehicle.
• Exclusions and limitations: Are there any exclusions or limitations to the insurance coverage? For example, "Acts of God," such as natural disasters, may not be covered by the carrier's insurance. Understand what situations are included and excluded from their coverage.
• Proof of insurance: Request proof of insurance from the auto transport company. Verify their coverage levels, dates, and any relevant exclusions or limitations. A reputable company should be transparent and provide you with the necessary documentation.
• Additional insurance options: Inquire about any additional insurance options offered by the auto transport company. Some companies provide extra insurance, such as gap coverage or cash toward your deductible.
• USDOT and MC numbers: Check the USDOT (US Department of Transportation) and MC (Motor Carrier) numbers of the auto transport company. These numbers serve as licenses and authorizations for the company to operate. You can verify these numbers on the Federal Motor Carrier Safety Administration website to ensure the company is legitimate.
• Background checks: Ask if the company conducts background checks on their truck drivers. This can help minimize the risk of any issues during the transport of your vehicle.

Remember, it's your responsibility to verify the auto transport company's insurance coverage. By asking these detailed questions, you can make an informed decision and ensure your vehicle is adequately protected during transportation.

What is the Bill of Lading?

A Bill of Lading (BL or BoL) is a legal document that is issued by a transportation company to a shipper. It details the type, quantity, and destination of the goods being carried. It serves as a shipment receipt when the carrier delivers the goods at a predetermined destination.

The document must accompany the shipped products, no matter the form of transportation, and must be signed by an authorized representative from the carrier, shipper, and receiver. It is a legally binding document that provides the carrier and the shipper with all the necessary details to accurately process a shipment.

A Bill of Lading has three main functions:

• It is a document of title to the goods described in the bill of lading.
• It is a receipt for the shipped products.
• It represents the agreed-upon terms and conditions for the transportation of the goods.

For example, a logistics company transporting gasoline from a plant in Texas to a gas station in Arizona would require a Bill of Lading. A plant representative and the driver would sign the bill of lading after loading the gas onto the truck. The truck driver would then request that the station clerk also sign the document when the carrier delivers the fuel to the gas station in Arizona.

A Bill of Lading can also help prevent asset theft if it is properly managed and reviewed. It is important to choose the right type of Bill of Lading, as this can prevent delivery delays and help locate goods that get lost during transport.

When shipping freight, a Bill of Lading is required. This can be created manually on paper or online. It acts as a receipt and shipping label and contains the details of the shipment, including content, origin, and destination. It also serves as a legal contract of carriage with terms and conditions.

Frequently asked questions