What is Repossessors Insurance?
Repossessors insurance is specialized coverage designed to protect businesses and individuals who recover vehicles or other property on behalf of lenders. These operations face unique liability exposures, including property damage, personal injury, and commercial auto risks during transport. This type of insurance is tailored to address the operational hazards associated with towing, handling, and storing repossessed goods.
Who Needs It
This coverage is essential for repo companies, recovery agents, towing contractors, and asset retrieval specialists. Whether you're an independent operator or manage a fleet, repossessors insurance helps protect your business from claims related to accidents, wrongful repossession allegations, or damage during recovery.
What It Typically Covers
Repossessors insurance policies often include a combination of the following protections:
- Commercial auto coverage: For vehicles used in repossession operations
- Garage liability: Covers bodily injury or property damage occurring on the premises
- On-hook coverage: Protection for vehicles or property being towed
- General liability: Covers other third-party claims of injury or damage
- Wrongful repossession coverage: Specific protection against legal claims related to repossession efforts
For example, if a recovery agent accidentally damages a vehicle while towing it from a client's property, on-hook coverage could help cover repair costs.
Common Exclusions or Limitations
Most policies exclude intentional damage, repossession without proper authorization, or operations conducted outside of policy terms. It's also important to review exclusions related to employee dishonesty or non-covered vehicle types. Understanding these exclusions helps reduce the risk of uncovered claims.
Factors That Influence Cost
Premiums for repossessors insurance depend on several underwriting factors, including:
- Number and type of vehicles used
- Geographic area of operations
- Claims history and loss experience
- Security measures at storage facilities
- Driver qualifications and safety records
Insurers may also consider the scope of services provided, such as skip tracing or transporting high-value assets.
Proof of Insurance & Compliance
Many lenders or financial institutions require repossession agents to provide proof of insurance before assigning work. Having proper documentation not only ensures compliance but also builds trust with clients. Certificates of insurance typically list liability limits and carrier contact information.
How to Get a Quote
The best way to find the right policy is to discuss with an agent who understands the repossession industry. They can help tailor a policy that fits your risk profile and meets contract requirements. You can discuss with an agent to get started.
For more detailed insights, check out the Understanding Repo Insurance guide and learn how the Recovery Specialist Program can support your business. If you deal with hard-to-locate assets, explore the Skip-Repossessed Vehicles Coverage options available.
Frequently Asked Questions
What types of vehicles are covered under repossessors insurance?
Most policies cover tow trucks, flatbeds, and service vehicles used in repossession activities. Coverage may vary based on vehicle type and use.
Is wrongful repossession included in basic liability coverage?
No, wrongful repossession coverage is typically an optional add-on and must be specified in your policy.
Do I need insurance if I subcontract repossession work?
Yes, even if you subcontract, your business may still be held liable. Insurance helps protect your operations from related risks.
Are repossession agents required to carry insurance by law?
Requirements vary by state and by lender contracts. It’s important to confirm local laws and client expectations.
Can repossession insurance help with storage facility claims?
Yes, if your policy includes garage liability or property coverage, it may respond to claims involving stored vehicles or property.
Still have questions? Talk to a local insurance expert.