Do You Need Insurance Coverage During Car Shipment?

When moving across the country, attending a car show, or purchasing a vehicle from an online dealer, sometimes driving isn’t an option. In this case, you may be considering hiring a professional auto transport company to ship your vehicle. For many, shipping their car is a big decision, given that their car is a valuable possession. They may be wondering whether or not their vehicle is insured during vehicle transport. Although damage during vehicle transport is unlikely, there is still the possibility that something could go wrong during the process. For this reason, it is important to understand how shipping insurance works.

Am I Required to Have Insurance?

The short answer is no, you are not required to have insurance in order to ship your car. The auto transport company is legally responsible for carrying liability insurance per the United States Department of Transportation. That said, you may opt for additional coverage to ensure your vehicle is adequately insured. This is especially important if you are shipping a luxury, antique, or exotic vehicle. Although less than 5% of cars that are transported report any damage, it will still give you peace of mind knowing that your vehicle is properly insured.

What are the Minimum Insurance Requirements for Shipping Companies?

As stated before, auto shipping companies are required by law to have insurance for the cars they transport. Most companies offer liability and cargo insurance, though you should confirm this with your specific shipping company. This insurance should cover any damage that might occur during loading, unloading, or transport. It is important to note, however, that this insurance only covers the car and not anything inside it. This is why you should never leave personal belongings inside your vehicle during shipment.

How Much Insurance is Enough?

Although all shipping companies are required to provide insurance, the exact amount of the policy might vary from one company to another. That’s why you need to verify the specific details of the insurance policy prior to shipment. You also want to pay attention to any limitations that might exist, such as “acts of god.” You need to find out what type of damages are covered, how much the deductible is, and whether or not you will need to purchase additional coverage. You should also check with your personal policy, as it may provide additional coverage for auto transport.