How to Start a Towing Company: Starting Checklist

The short answer

Starting a towing company means checking state and city towing licenses or permits, any rotation list requirements, buying the right trucks and equipment, getting commercial auto, on-hook and garagekeepers insurance, finding a storage lot that meets local rules, training drivers in safe operations, deciding on non-consent and private property work, and setting up dispatch and a website.

Worked example: a two-truck light-duty operation

Ray worked as a tow operator for eight years and opens his own company with a used wheel-lift and a new rollback. He checks with his city and county about towing licenses, rate rules for non-consent tows and the requirements for police rotation lists. He leases a fenced lot that meets the county's requirements for an impound storage facility, with lighting and posted release hours.

He buys commercial auto liability, on-hook coverage for vehicles while being towed, and garagekeepers for vehicles in storage. He signs up with two motor clubs for roadside calls, sets up a dispatch app that tracks trucks and calls, and launches a website with his service area, services, a request-help form and licensing details. He trains himself and his second driver on traffic incident management and the safe use of each truck.

Setup steps in order

Step	Done looks like
Licensing check	City, county and state rules known
Business setup	Entity, EIN, banking
Trucks and equipment	Wheel-lift and rollback ready
Insurance	Commercial auto, on-hook, garagekeepers
Storage lot	Meets local requirements
Rotation and motor clubs	Applications submitted
Dispatch	App, phone routing, call logs
Training	Safe operations and traffic incident management
Website and Google	Service area, request form, licensing

Mistakes new towing companies make

Charging non-consent rates above local maximums
Storage lots that do not meet local requirements
No on-hook insurance
Relying only on motor clubs that pay low rates
Drivers without traffic incident training

What this industry needs from a website

Dispatch contact, coverage and service information.

Home with call button
Services
Service area
Rates disclosure where required
About and licensing

Free tools

Opening timeline planner

Common questions

Do I need a towing license?

Many cities, counties and states require one, especially for non-consent towing. Check every jurisdiction you work in.

What insurance do towing companies need?

Commonly commercial auto liability, on-hook (cargo) coverage and garagekeepers for stored vehicles. Ask an agent who insures towing.

How do I get on the police rotation list?

Apply through the local police or sheriff agency; requirements often include equipment, response times, insurance and a storage lot.

Do FMCSA rules apply?

They can, depending on truck weight and whether you cross state lines. FMCSA's registration pages explain.

Should I start with motor club work?

Many new companies do for steady calls; build direct accounts alongside it.

Sources

Sources checked October 6, 2026. Rules, fees and forms change; confirm details with the agency or provider before you act. This guide is general information, not legal, tax or insurance advice.

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