Car Shipping Insurance: What You Need to Know
Fact Checked by: Your car is probably one of the most expensive assets you own other than your home, and you wouldn’t want to leave it unprotected. So, if you are planning to ship your vehicle with an auto transport company, you will want to make sure you have the right car shipping insurance.
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While it isn’t often that a vehicle is damaged in the process of shipping — especially if you choose one of our best car shipping companies — it can happen.
The Department of Transportation (DOT) requires all car transport companies to have liability insurance, but if you work with a car shipping broker, they aren’t required to provide any insurance beyond what the carrier provides.
Additionally, in some cases, this liability insurance won’t cover all types of damage that could happen to your vehicle in transit. Those with a new or classic car will likely want to consider purchasing some additional insurance coverage — such as gap coverage or a reduced deductible plan — if damage does occur.
Curious about what insurance coverage you should purchase for your vehicle and how it could impact your car shipping costs? We break down all the details of car shipping insurance below.
Types of auto transport insurance
There are three main types of auto transport insurance you will encounter as you shop for an auto shipping company. While you want to have one of those three at minimum, multiple coverage plans can help you have peace of mind when you ship your vehicle across the country.
| Type of insurance | Description | Required for shipping? |
|---|---|---|
| Customer | Personal auto insurance you pay for through your auto insurance company | No |
| Carrier | Liability insurance that covers your car during pickup, transit, and drop-off. | Yes |
| Broker | Additional insurance that can help cover gaps left in carrier liability insurance policies | No |
Customer car shipping insurance
While you are shopping around for a vehicle transport service, you may see the term, “customer car shipping insurance.” This term can sound confusing, but it simply refers to a personal auto insurance policy you can receive from your car insurance provider.
Once you know you want to ship your vehicle, you should call your auto insurance company and ask if they will cover your vehicle while it is in transit. Some policies might include this as standard, but others may require you to pay for additional coverage in order to adequately protect your vehicle.
If your insurance company does cover vehicle shipping, ask for details about the cost of the deductible so there are no surprises if you have to file a claim.
Carrier car shipping insurance
It is a legal requirement for all car carriers to carry liability insurance for any vehicle they ship. This insurance should cover the cost of damages that could occur during transit, though the customer will need to pay a deductible first.
Before you plan to work with a shipping service, ask to see a certificate of insurance or proof of insurance to ensure they have the coverage they claim to.
It’s also a good idea to read the fine print about the provided auto insurance coverage. Some carrier policies don’t cover things like small dents from hail or other acts of god that could occur on the road.
Broker car shipping insurance
Transport brokers may choose to offer customers supplemental insurance when they provide you with a car shipping quote but this coverage isn’t required by law.
Supplemental insurance packages vary widely from broker to broker, and you don’t have to purchase it if you don’t want to. Many brokers have gap policies, as well as policies that will help you pay the deductible of the carrier’s liability insurance policy if damage should occur.
What does auto transport insurance cover?
Auto transport insurance policies can be complicated and only cover certain aspects of the vehicle transport process.
In general, any damage that occurs to your vehicle during loading, transit, or during the unloading process is covered. However, any pre-existing damage to your vehicle — such as a loose bumper or oil leak — is not covered, even if the condition of the car deteriorates in transit.
Other exclusions include acts of god, vandalism, and any damage that occurs to personal items left in the vehicle during transit.
Car shipping insurance cost
When you ship your vehicle, basic carrier insurance is included in the cost of your shipment, no matter what shipper you use. Carriers are required by law to provide liability coverage for every customer who uses their shipping service.
However, many people who ship their cars find that the basic liability coverage isn’t enough to cover damages, and these plans often come with very high deductibles. As a result, they choose to buy additional coverage for their vehicle.
For example, AmeriFreight offers an AFta (Allied Freight Transportation Assistance) gap plan that covers up to $2,000 of the carrier insurance deductible if your vehicle is damaged in transit. This additional coverage plan is completely optional, and the cost will vary depending on how many miles you are shipping your vehicle.
How to file car shipping insurance claims
Sometimes, the unthinkable happens, and your car is damaged in transit. Here are the steps to file when you need to file a car shipping insurance claim:
- Note the damage on the bill of lading. You cannot file an insurance claim if you cannot prove that the damage happened while the vehicle was in transit. You’ll want to carefully check over your car’s condition when it is delivered and note any damages on the bill of lading before signing.
- Take pictures for the damage claim. Document the damage to your vehicle. You will also need to provide images of your vehicle before it was shipped to prove that the damage happened during the shipping process.
- Contact the carrier. After notating the damage to your vehicle, you’ll want to contact the auto transport service and ask how you can file a damage claim for your vehicle.
- Contact the broker. If you used an auto transport broker to find your car carrier, you will want to contact them as well, especially if you purchased additional insurance. If you didn’t purchase additional coverage, they aren’t required to help you but they may be able to direct you on the next steps to take.
- Collect documents. In addition to showing the carrier your copy of the bill of lading, you will want to provide proof of vehicle ownership, a copy of your driver’s license, and receipts (or quotes) to have the damage repaired.
- Contact your personal insurance provider. It is a good idea to contact your car insurance agent, as they may cover some of the damage to your vehicle that the motor carrier does not.
- File a complaint with the FMCSA. If your claim is denied despite providing proper evidence, you can file a complaint with the FMCSA (Federal Motor Carrier Safety Administration) to have the auto shipping company investigated and possibly penalized.
- File a complaint with the Better Business Bureau (BBB). While the BBB can’t get your money back for you, filing a complaint can put pressure on the motor carrier to find you a solution and warn future customers from working with the company.
- File litigation. If all else fails, you can consider filing a litigation against the company. This option, however, is time-consuming and costly. It probably isn’t worth it unless your vehicle is a total loss and you are sure the shipper is at fault.
Car shipping insurance tips
Choosing the right car shipping insurance can be tricky. Check out these tips to help you choose the right insurance for your situation:
- Before you agree to have your car shipped, ask for proof of insurance from the carrier.
- Check with your personal auto insurance company prior to shipping your vehicle to see if your insurance policy covers your vehicle in transit.
- If you work with a car shipping broker, ask about additional insurance plans.
- Always take a video or pictures of your vehicle just before and after shipping (for claims purposes).
- Consider the route. If your vehicle will be making a long multi-day or multi-week journey, additional insurance will be more critical than if your vehicle will only be in transit for a day or two.
- Shipping your vehicle in an open transport poses more potential risks (like damage due to the elements) than going with enclosed car shipping companies. However, enclosed transport can cost significantly more than open carriers.
- If you won’t be present during pickup or delivery, ensure that the person who is there on your behalf is prepared to thoroughly check your vehicle for damage. We recommend, however, that you make all efforts to be there yourself. After all, nobody knows your car better than you!
- Ask the driver directly about any damage you notice during delivery and contact the carrier right away.
FAQs about auto transport insurance
Do cars get damaged during shipping?
Unfortunately, vehicles can sometimes be damaged during transport. One in 20 customers reports some sort of minor damage to their vehicle during shipment. However, major damage is rare.
What should I do to protect my car during shipping?
The best way to protect your car in transit is to use a reputable auto transport company that performs background checks on every driver. If you can afford it, enclosed auto shipping is safer than open transport.
How long does it take for a car to be delivered?
The length of time it takes a vehicle to be delivered depends on several factors, such as shipment distance, whether or not the truck has other vehicles to deliver, and your availability. In general, shipping your car from coast to coast can take anywhere from five to 14 days.
What does transport insurance cover?
Transport insurance covers any damage to your vehicle that is the fault of the hauling company. This includes damages incurred during loading and unloading the vehicle, as well as if the truck driver gets into an accident on the road. It does not cover acts of gods, damage from road debris, or vandalism.
What is the most important factor to consider when getting auto transport insurance?
The most important factor to consider when getting auto transport insurance is whether or not the policy is sufficient to cover any major damage to your vehicle. While it is always best to hope for the best, you don’t want to skimp on auto insurance only to find yourself with a damaged vehicle you don’t have the money to repair.
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