Car Shipping Insurance: What's Covered & What's Not (2025 Guide)

Car shipping insurance covers **$100,000-$1,000,000** in damages, but understanding what's included and excluded can save you thousands in unexpected costs.

Standard Car Shipping Insurance Coverage

What's Included (All Carriers):

✅ **Collision damage** (accidents during transport)

✅ **Theft** (vehicle stolen from carrier)

✅ **Fire damage** (vehicle catches fire)

✅ **Vandalism** (intentional damage)

✅ **Weather damage** (hail, storms, etc.)

✅ **Carrier negligence** (improper loading/unloading)

Standard Coverage Limits:

**Minimum:** $100,000 (federal requirement)

**Most carriers:** $250,000-$500,000

**Premium carriers:** $1,000,000+

**FreightFloo carriers:** All have minimum $1,000,000 coverage

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What's NOT Covered (Common Exclusions)

1. Pre-Existing Damage

❌ **Scratches, dings, rust** that existed before shipping

❌ **Mechanical issues** (engine problems, transmission, etc.)

❌ **Wear and tear** (faded paint, worn tires)

**Protection:** Take detailed photos before pickup

2. Personal Items

❌ **Items left in vehicle** (clothes, electronics, tools)

❌ **Aftermarket parts** (stereo, rims, etc.) - unless declared

❌ **Spare keys** (if lost)

❌ **Documents** (registration, insurance cards)

**Solution:** Remove all personal items before shipping

3. Mechanical Failures

❌ **Engine won't start** after delivery

❌ **Battery dies** during transit

❌ **Tire goes flat** (unless carrier caused it)

❌ **Brake failure** (unless carrier damaged brakes)

4. Acts of God (Sometimes Excluded)

❌ **Floods** (in some policies)

❌ **Earthquakes**

❌ **Tornadoes** (varies by carrier)

❌ **Hurricanes**

**Note:** Most modern policies DO cover weather damage

5. Improperly Secured Vehicles

❌ **Damage from loose items** in vehicle

❌ **Damage from improper loading** (if you gave wrong instructions)

❌ **Damage from modifications** (lowered cars, oversized tires)

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Types of Car Shipping Insurance

1. Primary Coverage (Included)

**What it is:** Carrier's insurance (automatic)

**Coverage:** $100k-$1M (varies by carrier)

**Deductible:** Usually $0-$500

**Best for:** Most standard vehicles

2. Declared Value Coverage

**What it is:** Extra coverage for high-value vehicles

**Coverage:** Up to vehicle's actual value

**Cost:** $50-$200 extra

**Best for:** Cars worth $50k+

Example:

Vehicle value: $80,000

Standard coverage: $250,000 (sufficient)

Declared value: $80,000 (exact coverage)

Cost: $100 extra

3. Comprehensive Coverage

**What it is:** Covers personal items + aftermarket parts

**Coverage:** $1,000-$5,000

**Cost:** $25-$75 extra

**Best for:** Vehicles with expensive modifications

4. Gap Coverage

**What it is:** Covers difference between insurance payout and loan balance

**Coverage:** Up to loan amount

**Cost:** $50-$150 extra

**Best for:** Financed vehicles with negative equity

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How Insurance Claims Work

Step 1: Document Everything (Immediately)

Take photos of damage

Note damage on Bill of Lading

Get witness statements

Keep all paperwork

Step 2: File Claim (Within 24-48 Hours)

Contact carrier immediately

Submit photos and documentation

Fill out claim forms

Get claim number

Step 3: Inspection (1-3 Days)

Insurance adjuster inspects vehicle

Estimates repair costs

Determines if claim is valid

May require multiple estimates

Step 4: Settlement (1-4 Weeks)

Accept settlement offer

Or negotiate if too low

Receive payment

Get vehicle repaired

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Real Insurance Claim Examples

Example 1: Minor Damage ✅

**Damage:** Scratches on rear bumper (carrier's fault)

**Repair cost:** $800

**Insurance payout:** $800 (full coverage)

**Timeline:** 2 weeks

**Result:** Happy customer

Example 2: Major Damage ✅

**Damage:** Side panel dented during loading

**Repair cost:** $3,200

**Insurance payout:** $3,200 (full coverage)

**Timeline:** 3 weeks

**Result:** Customer satisfied

Example 3: Pre-Existing Damage ❌

**Damage:** Customer claimed "new" scratch

**Reality:** Scratch existed before (proven by photos)

**Insurance payout:** $0

**Result:** Claim denied

Example 4: Personal Items ❌

**Damage:** Lost $2,000 stereo system

**Issue:** Personal items not covered

**Insurance payout:** $0

**Result:** Customer lost money

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Insurance Tips for Different Vehicle Types

Luxury Cars ($50k+)

**Get declared value coverage**

**Use enclosed transport** (better protection)

**Document everything** (professional photos)

**Consider gap coverage** (if financed)

**Example:** 2023 BMW M5 ($120k)

Standard coverage: $1M (sufficient)

Declared value: $120k (exact coverage)

Extra cost: $150

**Worth it for peace of mind**

Classic Cars

**Specialized classic car insurance** may be better

**Appraisal required** for high-value classics

**Enclosed transport** highly recommended

**Document all modifications**

Electric Vehicles (Tesla, etc.)

**Battery damage** usually covered

**Special handling** may be required

**Document charge level** before pickup

**Consider comprehensive coverage** for tech

Modified Cars

**Declare all modifications** (wheels, stereo, etc.)

**Get comprehensive coverage**

**Take photos** of all aftermarket parts

**Keep receipts** for modifications

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How to Maximize Your Insurance Protection

Before Shipping:

1. **Take 50+ photos** (all angles, close-ups)

2. **Video walk-around** (start phone recording)

3. **Document existing damage** (write down every scratch)

4. **Remove all personal items**

5. **Clean vehicle** (easier to spot new damage)

6. **Check tire pressure** and fluid levels

During Pickup:

1. **Walk around with driver**

2. **Point out existing damage**

3. **Have driver sign** damage acknowledgment

4. **Get copy** of Bill of Lading

5. **Take photos** of driver and truck

During Transit:

1. **Track shipment** (FreightFloo provides GPS)

2. **Save all updates** and communications

3. **Note any delays** or issues

At Delivery:

1. **Inspect before signing** anything

2. **Compare to pickup photos**

3. **Test drive** if possible

4. **Document any damage** immediately

5. **Don't sign** if damage is found

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FreightFloo Insurance Advantages

1. Higher Coverage Limits

**All carriers:** $1M minimum (vs $100k-$250k industry standard)

**Premium carriers:** Up to $5M coverage

**No extra cost** for higher limits

2. Faster Claims Processing

**Direct carrier relationships** (no broker delays)

**24-hour claim filing** requirement

**Average settlement:** 2-3 weeks (vs 4-6 weeks industry)

3. Better Documentation

**Pre-pickup photos** automatically taken

**GPS tracking** provides evidence

**Digital Bill of Lading** (no lost paperwork)

4. Dispute Resolution

**FreightFloo mediation** if carrier disputes claim

**Independent adjusters** for major claims

**Customer protection** policy

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Common Insurance Mistakes to Avoid

1. Not Taking Enough Photos

**Mistake:** 5-10 photos

**Solution:** 50+ photos from all angles

**Why:** Photos are your best evidence

2. Signing Delivery Without Inspection

**Mistake:** Sign first, inspect later

**Solution:** Inspect thoroughly before signing

**Why:** Once signed, hard to prove damage happened during transit

3. Leaving Personal Items

**Mistake:** "Just a few small things"

**Solution:** Remove everything

**Why:** Personal items never covered

4. Not Reading the Policy

**Mistake:** Assuming everything is covered

**Solution:** Read carrier's insurance policy

**Why:** Know your coverage limits and exclusions

5. Waiting Too Long to File

**Mistake:** Filing claim weeks later

**Solution:** File within 24-48 hours

**Why:** Fresh evidence is stronger evidence

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Insurance Cost Breakdown

Typical Costs:

**Basic coverage:** $0 (included in shipping cost)

**Declared value:** $50-$200 extra

**Comprehensive:** $25-$75 extra

**Gap coverage:** $50-$150 extra

What Affects Insurance Cost:

1. **Vehicle value** (higher value = higher cost)

2. **Coverage type** (declared value costs more)

3. **Distance** (longer trips = slightly higher risk)

4. **Carrier** (premium carriers charge more)

FreightFloo Pricing:

**Standard coverage:** $0 (included)

**Declared value:** $50-$150 (vs $100-$300 brokers)

**No hidden fees** or surprise charges

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When You DON'T Need Extra Insurance

Standard Coverage is Enough if:

✅ Vehicle worth less than $50k

✅ No expensive modifications

✅ No personal items in car

✅ Standard daily driver

✅ Good documentation before shipping

Save Money by:

Taking excellent photos

Removing all personal items

Using FreightFloo's included $1M coverage

Choosing experienced carriers

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Get Protected with FreightFloo

Why FreightFloo customers have fewer insurance issues:

1. **$1M coverage** (industry-leading)

2. **Verified carriers** (better track record)

3. **Real-time tracking** (evidence of proper handling)

4. **Digital documentation** (no lost paperwork)

5. **Faster claims** (direct carrier relationships)

Average FreightFloo customer saves $200-$400 on insurance costs vs traditional brokers

[Get Free Quote with Full Insurance Coverage →](/signup?type=shipper)

**Ship with confidence. Get maximum protection.** 🛡️