If you're running a moving company, here's something that might surprise you: your personal auto insurance policy is worthless for business use. The moment you load someone's furniture into your truck and start charging for the service, you've crossed into commercial territory. And if something goes wrong—an accident, property damage, an injury—your personal policy will deny the claim faster than you can say "not covered."
Commercial auto insurance for moving companies isn't just a good idea—it's legally required in almost every state and federally mandated if you cross state lines. But here's the good news: once you understand what you need and why, getting the right coverage is straightforward. Let's break down exactly what your moving business needs to stay protected and compliant.
Why Moving Companies Need Commercial Auto Insurance
The fundamental issue is simple: personal auto policies explicitly exclude business use. When you're hauling household goods for profit, you're operating a commercial vehicle—even if it's a pickup truck you also drive on weekends. Insurance companies view this differently because the risk profile changes completely. You're on the road more often, carrying heavier loads, making frequent stops, and handling other people's property.
Commercial auto insurance is required by law in every state except New Hampshire. But the requirements get stricter if you cross state lines. Interstate moving companies must register with the Federal Motor Carrier Safety Administration (FMCSA), obtain a USDOT number, and carry minimum liability coverage of $750,000. Some states have even higher requirements—New Jersey, for example, raised its minimum to $1.5 million as of July 2024.
Beyond legal compliance, commercial auto insurance protects you from catastrophic financial loss. If your driver causes a serious accident, medical bills and property damage claims can easily reach six or seven figures. Without proper coverage, your business assets—and potentially your personal assets—are on the line.
Understanding the Three Types of Coverage You Need
Moving companies typically need three distinct types of auto coverage, and understanding the difference is crucial:
Owned Auto Coverage is what most people think of as commercial auto insurance. This covers vehicles your business owns or leases—your moving trucks, box trucks, or cargo vans. It provides liability coverage for bodily injury and property damage you cause to others, plus optional physical damage coverage for your own vehicles. For moving companies, the national average cost is $876 per month, though this varies dramatically based on your fleet size, driver records, and location.
Hired Auto Coverage protects you when your business rents or leases vehicles temporarily. Say you're handling an unusually large move and rent an additional truck for the day. If your employee causes an accident in that rental, hired auto coverage responds. The rental company's insurance often has high deductibles and limited liability coverage, so relying on it alone leaves you exposed.
Non-Owned Auto Coverage is the one most moving company owners overlook—and it's critical. This covers liability when employees use their personal vehicles for company business. Maybe your crew leader drives their own pickup to grab supplies, or your office manager runs a business errand in their car. If they cause an accident while on company time, you could be held liable under the legal doctrine of "vicarious liability." Non-owned coverage protects you in these situations.
Most moving companies bundle hired and non-owned coverage together (often called HNOA insurance). It's typically inexpensive—often less than $1,000 annually—because it's secondary coverage that only kicks in after the employee's personal insurance is exhausted. But that gap coverage can save your business from devastating lawsuits.
How Much Coverage Do You Actually Need?
The minimum legal requirement and the amount you should actually carry are two very different numbers. While federal law requires $750,000 for interstate movers, most insurance professionals recommend at least $1 million in liability coverage. Here's why: a single serious accident can generate claims that blow past $750,000 quickly. Medical costs, lost wages, pain and suffering, vehicle damage—it adds up fast.
Industry data shows that the average commercial auto policy carries $1 million in combined single limit coverage, and this has become the de facto standard for moving companies. Many commercial clients won't even hire you without it. Combined coverage limits of $300,000 to $500,000 provide adequate protection for many small operations, but if you're running multiple trucks or handling high-value moves, you should consider higher limits.
For businesses with above-average liability exposure—such as those operating large fleets or frequently working in dense urban areas—commercial umbrella insurance is a smart addition. Umbrella policies boost your maximum coverage limits, often up to $5 million or more, for a relatively modest additional premium. Think of it as catastrophic protection that kicks in when your primary commercial auto policy is exhausted.
Beyond Auto: Other Coverage Moving Companies Need
Commercial auto insurance is essential, but it doesn't cover everything. Moving companies face unique risks that require additional policies:
Cargo insurance is critical because commercial auto policies don't cover the property you're transporting. If you damage or lose a customer's belongings during a move, cargo insurance pays to replace or reimburse them. The FMCSA requires minimum cargo coverage of $5,000 per vehicle and $10,000 per incident, but most brokers and commercial clients require at least $100,000. Moving expensive items or handling commercial relocations? You'll want even higher limits.
Physical damage coverage protects your own vehicles from damage, theft, or weather-related losses. Your commercial auto liability policy covers damage you cause to others—but if your truck is totaled in an accident you caused, you're out of luck without physical damage coverage. This is especially important if you're financing your vehicles, as lenders typically require it.
General liability insurance covers non-auto accidents and injuries. If a mover drops a dresser on someone's foot, or damages a client's hardwood floors while carrying furniture, general liability responds. Moving companies pay an average of $120 per month for general liability with typical limits of $1 million per occurrence and $2 million aggregate.
How to Get the Right Coverage for Your Moving Business
Start by getting quotes from insurers who specialize in commercial trucking and transportation businesses. They understand your industry's risks and can structure policies that actually match your operations. Generic business insurance agents often miss critical coverage gaps for moving companies.
Be prepared to provide detailed information: the types and ages of your vehicles, driver records for everyone who'll be behind the wheel, annual mileage estimates, and the radius of your operations (local, regional, or long-haul). Insurers also want to know your safety practices—driver training programs, vehicle maintenance schedules, and safety policies all impact your rates.
If you're just starting out, expect higher premiums until you establish a track record. New moving companies with inexperienced drivers pay significantly more than established businesses with clean loss histories. The good news? Your rates can drop substantially after a few claim-free years. Focus on hiring drivers with clean MVRs (motor vehicle records), implementing rigorous safety training, and maintaining your vehicles meticulously.
Review your coverage annually. As your business grows—adding vehicles, expanding your service area, or taking on larger commercial accounts—your insurance needs change. Don't wait until you have a claim to discover you're underinsured. A good insurance agent will proactively review your coverage each year and recommend adjustments based on your business evolution.
Running a moving company comes with significant responsibility—you're trusted with people's belongings and their safety on the road. Commercial auto insurance, combined with hired and non-owned coverage, cargo insurance, and proper liability limits, creates a comprehensive safety net. It's not just about meeting legal requirements; it's about protecting the business you've built from risks that could otherwise wipe you out overnight. Get quotes, compare coverage options, and make sure you're properly protected before your next move.
