Understanding Insurance and Liability Coverage for Auto Transport – Updated 2024

In today's rapidly changing world, people need to move their cars from one state or country to another quickly and often.

Whether moving to a new place, buying a new car, or embarking on a cross-country tour, auto transport companies provide an ideal way forward.

However, it is commendable if the car owner wants to keep the transport vehicle safe in transit, and this is where auto transport insurance comes in handy.

This blog will explain why auto transport insurance is necessary, what it includes, the various kinds that exist in the market, and how one can choose an appropriate policy.

This knowledge helps you guard your essential items during transportation by understanding the importance of this insurance and the factors that lead to its cost determination.

Now, let us delve deeper into car transport insurance and understand why it is essential for anyone to ship their car.

What is auto transport insurance shipping?

Auto transport or car insurance shipping is a kind of insurance product created to protect your automobile in transit.

Your average auto insurance policy often covers some of the risks when operating the car but will not include any damage caused during transportation.

Purpose of car transport insurance

Car transport insurance is meant to indemnify your vehicle in case there is an accident during transport.

The scope is that the organization uses it as insurance in case of accidents while loading or unloading goods, theft, vandalism, or any other factor beyond human control.

Protection beyond standard auto insurance

Car transport insurance provides coverage not offered by the standard automobile insurance policy.

It specifically addresses the risks associated with transporting your vehicle, such as:

Road hazards: Road accidents, falling into potholes, booked/finding objects/ obstructions on the road or car tracks.

Loading and unloading accidents: Sometimes, they may get spoilt during the loading and unloading to their final destinations.

Theft and vandalism: Security against theft or any unworthy act that may be intended to affect your automobile.

Weather-related damage: Insurance against risks posed by unfavorable climate and events such as storm hails or floods.

A few things might happen to your car in transit, and to avoid accidentally hitting any of them, you should insure your vehicle through car transport insurance.

What does auto transport insurance cover?

Auto transport insurance typically includes two main components: On the liabilities side, exposure is drawn from different liability coverage and cargo insurance.

Liability coverage

This coverage is essential as it ensures that if the carrier company is at fault for any harm done to your vehicle, they are liable to meet all the expenses.

It ensures that damages or losses are catered for in cases where the airline is to blame.

Cargo insurance

This plan covers losses not catered for by the liability coverage so that the shipments will be protected.

This is especially so when the carrier is not implicated in causation, such as when the item is stolen, vandalized, or destroyed by natural disasters such as a storm.

Common exclusions

While auto transport insurance offers comprehensive coverage, there are some standard exclusions to be aware of:

Personal belongings: Food, beverages, personal belongings, and other items inadvertently left in your car, including electronics and other valuable personal belongings, are not recoverable.

Pre-existing damage: Any harm your vehicle incurred before being transported is usually not the company's responsibility.

Mechanical failure: Problems relating to mechanical failures or tear and wear are often not included.

Acts of war: Expenses that result from war or terrorism and acts of terrorism are not included.

So, one must always take time to read the fine print to understand the auto transport insurance policy and its coverage, disadvantages, and other inconveniences.

Types of auto transport insurance

When you decide upon car transport insurance, several options exist to fulfill various requirements and prices.

Here are some common types of coverage:

Comprehensive coverage

It covers lots of risks and thus can be said to be the most comprehensive. It typically covers damages caused by:

Theft

Vandalism

Fire

Natural disasters (e.g., floods, hurricanes)

Collision with another object (e.g., a tree, pole, or building)

Collision coverage

Comprehensive coverage refers to damages that occur and are not expressly mentioned in the collision coverage plan, such as impacts from other automobiles and objects.

This can be of immense importance in case the car gets damaged through an accident during transport.

Gap coverage

If, during the shipment of your vehicle, it is stolen or wrecked beyond recognition and insurance compensation does not suffice to clear your loan, then the gap coverage comes in handy.

It closes the difference between the current market price of your car and the balance in your auto loan.

Choosing the right coverage

The best type of coverage for you depends on several factors, including:

Vehicle value: It may be preferable to go for extensive coverage if you own a valuable, expensive, or luxurious car.

Loan balance: Gap coverage offers come in handy if your loan balance is high.

Risk tolerance: Think about what risks you are willing to expose yourself to and how safe you want to be.

How much does auto transport insurance cost?

Average cost ranges

As noted, it is challenging to estimate the average costs of auto transport insurance since all the said factors will impact total pricing; however, it will typically range between $300-$2000 for a full coverage policy.

Auto transport insurance is quite expensive, but it depends on certain factors, as explained below.

Here is a breakdown of the key influences and potential cost ranges:

Factors influencing cost

Vehicle type and value: This may be because luxury, sports, or classic cars may cost more than your average car and, as such, call for higher premiums.

Distance of transport: The distance the car must cover can also control the price. They reflect the risk grade by assuring longer distances, which may include enhanced risk and steep premiums.

Method of transport: The insurance costs of enclosed transport are generally higher than those of open transport because the former offers more protection.

Potential cost savings

To potentially reduce the cost of auto transport insurance:

Bundle with existing insurance: If you have auto insurance, it would be best to ask about car transport insurance services. For instance, this could lead to bargaining or scaling prices in their favor through rebates.

Shop around: You should get quotes from the recommended insurers to compare the prices and policies offered.

Consider deductibles: This is an aspect that most patients fail to understand because its logic is remarkable; clients pay less as their premiums are low despite having adopted high deductibles. But please remember its cost and the amount that may be required to pay out of your pocket in case of the claim.

These include the intensity of the insurance, the type of coverage, the mode of shipment, the type of transport, and many more.

If you circumvent these factors, you can always get the best and cheapest auto transport insurance.

Also, read How much does shipping a car cost

Do You Need Auto Transport Insurance?

When shipping your vehicle, insurance is very important, hence the need to make sure that you take adequate insurance.

It is to note, that most auto transport carriers offer liability and cargo insurance, but you should check it to provide necessary coverage.

Liability and cargo coverage: It is also important to ensure that your carrier provides both liability and cargo insurance. Ideally, the minimum amount of liability should be one million dollars with three hundred and fifty thousand dollars for goods.

Review your carrier's policy: Read the carrier’s insurance policy to assess the carrier’s coverage options, limitations, and other things prohibited thereunder.

Check your personal auto insurance: Some of the group personal policies may provide for restricted forms of vehicle transport. It is advised to talk to your agent to find out whether you require further coverage for your belongings.

Consider additional coverage: To find out if further coverage for expensive cars or special modifications, there may be procedures that will for such car owner’s full coverage.

If you consider these points and reconsider your insurance plans you will be able to properly ensure your vehicle when it is being shipped.

When should I buy an additional transport insurance policy?

Thus, the insurance you get from the car transport company can be good most of the time; nevertheless, there are times when more coverage is needed for the complete protection of your car.

Consider these factors:

Scenarios for additional coverage

High-value vehicles: In case you are going to transport a luxury car, a classic car, or any other valuable car, it is essential to mention that there is always an option to get additional coverage.

Custom modifications: Vehicles with many changes or fitted aftermarket parts could require special insurance to cater to their replacement value.

Unique transportation needs: More insurance may be required if your car has special needs or is taken to another region.

Peace of mind: If all that one desires is the comfort and the security of getting more safety, then buying more insurance is very often a clever idea.

Benefits of having extra protection

Financial security: This insurance is helpful if, during the period of insurance, the product is damaged or lost; in this case, extra costs will be needed to repair or replace the item.

Peace of mind: This may help you to have a sound mind and eradicate any anxiety that might be caused when you realize your vehicle is on the road and not insured.

Coverage gaps: Thus, it is possible to stand accredited and independent insurance to complement any deficiencies in the transport insurance company.

Assessing your specific needs

To determine if additional transport insurance is necessary, consider the following factors:

Vehicle value: The higher the value of your vehicle, the more critical it is for you to ensure that you have the right insurance.

Shipping distance: Those traces that cover longer distances may be risky and need further protection.

Vehicle condition: More emphasis may be required if your car has parts needing additional protection or some damaged areas.

Personal risk tolerance: Check up on your satisfaction and determine whether to incur more charges for additional insurance that may relieve you.

Therefore, after considering the factors below, it will be easier to decide if owning more transport insurance is wise.

Choosing the right vehicle transport insurance

When selecting the most suitable car transport insurance, consider the following steps:

1. Review existing insurance coverage

Check your current auto insurance policy: Check whether your current policy contains any provision about vehicle shipping.

Contact your insurer: Inform your insurer about your car shipping intentions and get to know the potential coverage peculiarities, which can also be some limitations.

Evaluate the adequacy of your current coverage: Determine whether your current insurance coverage meets your requirements and the cost of your car.

2. Assess insurance offered by transport companies

Review the insurance provided by the car transport company: Every single car rental company gives clients at least some form of liability coverage.

Compare coverage options: According to the units of measure used for coverage, assess the extent of the coverage by admitting high deductibles and low limits and excluding certain risks.

Request detailed information: Request for the insurance details when you are given a shipment quotation.

3. Explore third-party insurance options

Research independent insurance providers: It will be advisable to buy an insurance policy from another company to ensure that you get adequate compensation in the event of an accident.

Compare prices and coverage: You should shop for the insurance prices online and compare them, enabling you to identify the best insurance that covers your needs.

Consider specialized policies: Other optional coverage must be considered if your car has amenities or needs extra safeguards.

Key factors to consider

Coverage: Ensure that the insurance pertains to the hazards that worry you for damages, thefts, or severe weather conditions.

Cost: Return to the insurance matter and look at some options and your available funds.

Reputation: Always select an insurance company with a proven performance record, especially in customer satisfaction.

Claims process: Learn the measures taken regarding the claims and how effortless it is to claim in the event of loss or damage.

By so doing, you can choose one of the best car shipping insurances that will adequately cover your car during transportation.

Tips for buying car transport insurance

To ensure you have the right coverage and a smooth car shipping experience, follow these tips:

1. Get everything in writing

Always get a written agreement that shows the terms and conditions of the insurance policies to be provided.

It is also important to note the degree of coverage, any deductibles that will be required, and the conditions of exclusions.

It is also worth noting that you should retain a copy of the insurance policy.

2. Request proof of insurance

When negotiating the shipping terms, you should ask the transport company to attach copies of the insurance policies.

It ensures that the effectiveness of the insurance it provides to the vehicle is as per required standards.

3. Remove valuables from your car

In this case, it is recommended that you take all your items, valuables, or any electronics left in the car before shipping them.

Items such as personal belongings, pre-existing damage, mechanical failure, etc., are excluded from car transport insurance and can easily be damaged during the transport period.

4. Perform a pre-shipment inspection

Be as physically involved as possible before your car is loaded by the carrier for transportation.

Take pictures or author a report of the existing conditions that might show signs of prior damage.

This will ensure you do not fall victim to any disagreements about damage that may have been caused while transporting the goods.

5. Complete the bill of lading

Ensure the Bill of Lading and the shipping contract are scrutinized and filled.

Describe your car with clear information on the car's state, which may be before the accident.

That is why retaining a copy of the Bill of Lading is advisable.

6. File a Complaint if Necessary

If you have problems or think an insurance claim has not been handled correctly, please do not hesitate to complain—some places you can report to include the Better Business Bureau or even your state's insurance department.

The tips outlined above will thus help ensure you have the right car transport insurance and help secure your car from damage while in transit.

Where to file a complaint

It is often necessary to file a complaint in case of problems concerning car transport insurance or the shipping process.

Here are some organizations where you can report your concerns:

Better Business Bureau (BBB)

BBB is a non-profit organization that assists consumers in fighting business organizations in case of any disagreement.

However, the form of complaint is flexible since you can even file it online or through the phone. Thus, BBB will try to facilitate the conflict between you and the insurance or car transport company.

Department of Transportation (DOT)

The DOT stands for the Department of Transportation, the federal government body responsible for directing the transport industry.

If you have any complaints about any car transport company, you can report them to the FMCSA under the Department of Transportation.

To report your complaint, you may go online or author an email.

Additional resources

State Insurance Department: If you have insurance-related complaints, they should turn to your state's insurance department for help.

Attorney general's office: If you think you have been defrauded or received some unsavory business deal, you can report it to the Attorney General of your state.

Self-organization Litigation may work for you to sue a specific business, which will work best for reporting a complaint to an appropriate organization.

Why choose Universal Transit for your vehicle's safe journey

Here at Universal Transit, we know the need to Secure your assets as you transport them.

That is why when we offer insurance, we ensure your car is protected with as many policies as possible during shipment.

Our commitment to insurance coverage

We are also passionately committed to protecting our customers by offering them the highest protection possible.

Our insurance policies are designed to cover a wide range of potential risks, including:

Damage caused by accidents or collisions

Theft and vandalism

Weather-related damage

Loading and unloading mishaps

Comprehensive protection options

We have different insurance products and services that we want to deliver as per your demand and the amount you are willing to spend on insurance.

We offer auto shipping insurance for every car. Our comprehensive policies can include:

It was prescribed to safeguard the policyholder against any accidents caused by the carrier.

Cargo insurance for cases where liability lines do not compensate various losses and damages.

Extra provisions for exceptional exposure or easily perishable property.

Customer satisfaction focus

Our customer care policy goes to our insurance services as well.

Our goal is to ensure that you understand the coverage we offer in our insurance policies and enable you to make the right decision.

Our qualified and experienced staff will gladly answer Your questions and explain the main principles of insurance.

When you opt for Universal Transit, you can be confident that your car is well insured with adequate insurance, which guarantees safe and secure means of transport.

Conclusion

In today's world, where the use of vehicles is becoming inevitable, ensuring the safety of the car being transported is especially important.

Car transport insurance offers security to your investment by providing compensation for loss in case of an occurrence of the abovementioned events.

Key points to remember

Importance of insurance: Car transport insurance covers damage and losses that may occur during transportation.

Coverage options: Learn about distinct categories of coverage that are available, including comprehensive, collision, and gap coverage, to make an informed decision.

Factors affecting cost: They also get to select what they want to be insured for based on factors like the value of a particular vehicle and distance, among others, that you intend to travel, among other similarities.

Additional coverage: Determine whether additional coverage is required for expensive cars, modifications made to a vehicle or hire use of a car.

Choosing the right company: Choose a well-experienced transport company that includes insurance services and has a good record of accomplishment of performance.