Does Towing Increase Your Car Insurance?

The relationship between a vehicle being towed and its impact on car insurance premiums is a common concern for many drivers. This article explores how a towing incident might influence insurance rates.

Direct Impact of Towing on Premiums

The act of a vehicle being towed does not directly cause an increase in car insurance premiums. Insurers focus on the specific circumstances and the underlying reason that led to the vehicle requiring a tow, viewing the tow as a logistical necessity following an incident.

Underlying Reasons for a Tow and Premium Impact

While the tow itself usually does not affect premiums, the conditions leading to it can significantly influence insurance rates. An at-fault accident is a primary reason a vehicle might need towing, and it almost certainly leads to higher premiums. Drivers with a single at-fault accident might see their full coverage premiums increase by an average of 42% to 49%. This increase can persist for three to five years, depending on the state and insurance company, as insurers view such incidents as a strong predictor of future claims.

Traffic violations resulting in vehicle impoundment and subsequent towing can also drastically impact insurance costs. A conviction for driving under the influence (DUI), for instance, is considered a severe violation that marks a driver as high-risk. This can lead to average premium increases ranging from 50% to over 100%, and sometimes even tripling rates. These elevated rates may last for several years, typically three to ten, and often require the driver to obtain an SR-22 form, a certificate of financial responsibility, which further signals high risk to insurers.

Parking violations that result in a tow are generally civil matters and typically do not directly affect car insurance premiums. However, if unpaid parking tickets are sent to a collections agency, this could negatively impact a driver’s credit-based insurance score, which some insurers use to calculate rates. A vehicle breakdown requiring a tow, if not related to an accident or other claim, generally does not impact premiums.

Insurance Coverage for Towing Costs

Various types of insurance coverage can help with the costs associated with towing, distinct from the impact on premiums. Roadside assistance coverage is an optional add-on that specifically covers towing for non-accident events like mechanical breakdowns, flat tires, or running out of fuel. This coverage typically costs between $15 and $80 annually when added to an auto policy. While occasional use of roadside assistance generally will not increase premiums, frequent use might signal higher risk to an insurer, potentially leading to increased rates or policy adjustments.

Collision coverage typically includes towing costs if the tow is a direct result of a covered accident, regardless of fault. If another driver is at fault, their liability coverage should cover these expenses. Comprehensive coverage may also cover towing if the incident is due to a non-collision event such as theft, vandalism, or damage from natural disasters. In situations where specific insurance coverage does not apply, or if the policyholder chooses not to file a claim, towing costs would be paid out-of-pocket, with an average tow costing around $109, and rates ranging from $2.50 to $7 per mile.

General Factors Affecting Insurance Premiums

Beyond towing incidents, many other factors influence car insurance premiums. A driver’s record, including past accidents and traffic violations, is a significant determinant of rates, as insurers use this history to assess future risk. The type of vehicle insured, considering its make, model, safety features, and theft risk, also plays a role in premium calculation.

Geographic location is another important factor, with premiums varying based on local crime rates, population density, and frequency of claims. Annual mileage, credit score (in most states), age, and driving experience are additional considerations that influence the overall cost of an insurance policy. The chosen deductibles and coverage limits also directly impact the premium amount, as higher deductibles generally lead to lower premiums.