Do I Need Insurance When Shipping My Car?

Maybe you’re moving across the country, sending your kid off to college with a lucky car, or relocating for a job that promises a new life and absolutely no time to drive 2,500 miles. Whatever the reason, your long loved Prius is going on a truck, and suddenly you’re wondering: Wait… what happens if something goes wrong? Should I have insurance? Does the shipping company have it? 

Take a deep breath. We’re going to break it down so you understand car shipping insurance better than you understand your own job.

Let’s just get this out of the way- yes, you should get insurance. Your shipping company is required by law to carry liability and cargo insurance, but that doesn’t mean you’re completely off the hook if damage does occur. Much like that suspicious “unlimited breadsticks” policy at The Olive Tree, the fine print matters. No, you shouldn’t eat that 15th breadstick, too, if you thought to ask.

Shipping insurance exists to protect your car in case something goes wrong between pickup and drop-off. That could be anything from a crazy falling of rocks or a wild desert storm.

Every legitimate car transport company must carry at least $750,000 in liability insurance, though many go up to $1 million or more (especially if they want to avoid angry customer reviews). Cargo insurance is the part you care most about. This covers the actual damage to your car while it’s in the carrier’s possession. The rest is more for them.

What you should know is that shipping company insurance usually only covers external damage caused by the carrier. For example, if your bumper gets cracked because another car moves and bumped it, that’s covered. If your lucky sticker collection gets stolen from the backseat? Not covered. Your overstuffed glove box full of napkins and expired registration cards get stolen? Also not covered.

Moral of the story: remove all your personal items from the car before shipping, and don’t assume everything is covered just because the word "insurance" is involved. That’s the bottom line.

Here's a fun twist: your own car insurance might help fill in the gaps, but only sometimes and under certain conditions.

Many personal car policies don’t explicitly cover car shipping damage unless you’ve got comprehensive coverage. Even then, it depends on the insurer.

If you have comprehensive coverage, your car could be covered during transit, but don’t just assume. Call your insurance provider and ask the following questions:

• Will my car be covered during shipping by a third-party carrier?
• What isn’t included?
• What kind of damages are included or excluded?
• How do I claim damages?
• Will filing a claim through my policy affect my premium? (Spoiler alert: yes, it probably will.)

Think of it this way: if you trust your carrier’s insurance as much as you trust your toddler with a gallon of milk, having your own backup policy might give you some extra peace of mind.

This isn’t just a fancy term invented to make you feel like you’re signing onto a lawsuit. The Bill of Lading (or BOL for those of us in the shipping world) is your official inspection form. It shows the condition of the car at pickup and delivery and acts like the “before” and “after” photos in a home makeover rally.

When your car is picked up, both you and the driver inspect it together and note any existing damage. At delivery, you’ll do the same thing. If there’s new damage not listed on the original BOL, guess what? You have a claim! If not- you’re out of luck.

This document is your golden ticket if something goes wrong. Don’t lose it. Don’t spill coffee on it. Don’t let your dog eat it. And whatever you do, don’t sign it without a solid personal inspection.

If your car is worth more than a few thousand dollars, yes- get that extra insurance. If it’s a luxury, classic, or collector car, absolutely yes- don’t even think twice. If it’s your high school car held together with duct tape and good intentions, maybe not. Think about it’s real value and value to your life and then make your call. Understand what is included and what isn’t from what you already have.

Some companies or brokers will offer supplemental insurance for an extra fee. This can raise the coverage limits or lower the deductible you would need to pay. Think of it like adding guac to your burrito- it costs a little more, but it might save you later from buying another sandwich when you get hungry.

Also, if your car is being shipped overseas or across the border, insurance rules get trickier and vary depending on destination. In those cases, buy extra insurance like your car’s passport depends on it because it does.

Let me tell you about my neighbor, John. John shipped his Audi from Miami to LA using a guy she found on Craigslist. Yes. Craigslist with a total stranger.

The car arrived with scratches, missing parts, and a mysterious banana peel inside. He couldn’t file a claim because the driver had no valid insurance and no proper inspection was done. He should be happy the car even arrived to be honest. 

Don’t be like John. Use a reputable shipping company (like the kind iMoving works with), check their credentials, ask for insurance documents, and read reviews. And whatever you do, don’t get your shipping advice from your cousin’s friend who “knows a guy.”

We get i- talking about insurance is about as fun as watching a boring documentary on a topic you hate. It’s worth understanding because your car is worth protecting and your time is valuable. Don’t skip the inspection, don’t assume you’re covered, and don’t be afraid to ask questions.

That is key! Nothing’s worse than standing next to a freshly delivered car with a missing mirror and a shipping company suddenly forgetting your name. Don’t be John.