Auto Transport Insurance: What’s Covered and What’s Not

February 24, 2026 · csg_admin

Auto Transport Insurance: What’s Covered and What’s Not

Let us cut through the noise. Alligator Shipping is here to give you the real deal on auto transport insurance, what is covered, and how to protect yourself. No fluff, no upsells, just the facts you need to make a smart move.

Your car is insured the second it goes on the truck. That is the law. But not all insurance policies are created equal, and some carriers will try to dodge claims like it is an Olympic sport. Here is what you actually need to know.

Types of Auto Transport Insurance

Carrier Liability Insurance (Required by Law)

Every auto transport carrier operating in the United States is required by the Federal Motor ‘
Carrier Safety Administration (FMCSA) to carry cargo liability insurance. This insurance covers ‘
damage to your vehicle that occurs during transport due to carrier negligence or accidents. ‘
Typical coverage ranges from $100,000 to $250,000 per vehicle for open carriers and $250,000 ‘
to $500,000 for enclosed carriers.

Supplemental (Gap) Insurance

Some transport companies and third-party providers offer additional coverage that fills gaps ‘
in the carrier’s standard policy. This can cover scenarios like theft, vandalism, natural ‘
disasters, or damage that falls within the carrier’s deductible. Supplemental policies ‘
typically cost $50-$200 depending on vehicle value and coverage limits.

Your Personal Auto Insurance

Check with your personal auto insurance provider. Many comprehensive policies cover your ‘
vehicle during transport under certain conditions. This can serve as a secondary layer of ‘
protection. Contact your insurer before shipping to confirm your coverage status.

What Is Typically Covered

• Collision damage: Damage from the carrier being involved in an accident
• Loading and unloading damage: Scratches, dents, or mechanical damage during the loading or unloading process
• Strap damage: Marks or damage caused by the tie-down straps securing your vehicle
• Road debris damage: Rock chips or damage from objects kicked up during transport (varies by policy)
• Carrier fire: Fire damage to the carrier trailer and vehicles aboard

What Is Typically NOT Covered

• Personal items inside the vehicle: Anything you leave in the car is not covered by carrier insurance
• Pre-existing damage: Damage documented on the Bill of Lading before pickup
• Mechanical failures: Engine, transmission, or electrical problems that occur during transit unless caused by the carrier
• Acts of God: Hail, floods, tornadoes, and other natural disasters (some supplemental policies cover this)
• Wear items: Tire wear, brake pad wear, or normal deterioration

How to File a Claim

1. Document at delivery: Note any new damage on the Bill of Lading before signing. Take photographs immediately.
2. Notify the carrier: Report the damage to the transport company in writing within 24 hours of delivery. Include photos and a description.
3. Get repair estimates: Obtain 2-3 written repair estimates from licensed body shops. This establishes the cost of damage.
4. File the formal claim: Submit your claim to the carrier’s insurance company with all documentation: pre-shipment photos, BOL, delivery photos, and repair estimates.
5. Follow up: Claims typically take 30-90 days to resolve. Keep records of all communication and follow up regularly.

Important: Never sign the delivery Bill of Lading without inspecting your vehicle first. Once you sign acknowledging no damage, filing a claim becomes significantly more difficult.

5 Ways to Protect Yourself

1. Take detailed photos before pickup (every angle, close-ups of existing damage)
2. Verify the carrier’s insurance certificate and coverage limits before pickup
3. Read the Bill of Lading carefully at both pickup and delivery
4. Check your personal auto insurance for transport coverage
5. Consider supplemental insurance for high-value vehicles

Common Insurance Myths

• Myth: Your personal car insurance covers everything during transport. Reality: Many personal auto policies have exclusions for vehicles in the care of third-party carriers. Some comprehensive policies do provide secondary coverage, but you should never assume. Call your insurance agent before shipping.
• Myth: All carrier insurance is the same. Reality: Coverage limits, deductibles, and exclusions vary significantly between carriers. One carrier might have a $500 deductible while another has a $1,500 deductible. These details matter if you need to file a claim.
• Myth: Insurance claims are resolved quickly. Reality: The average auto transport insurance claim takes 30 to 90 days to resolve. Having thorough documentation (pre-shipment photos, signed BOL, repair estimates) can speed up the process significantly.
• Myth: Signing the delivery BOL means you accept the vehicle as-is. Reality: You have the right to note any new damage on the BOL before signing. However, once you sign without noting damage, proving the carrier caused it becomes extremely difficult.

The Bottom Line

Now you know the deal with auto transport insurance. No more guessing, no more getting played. Alligator Shipping has your back. Grab a free quote and let us handle the rest.

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