Licensed and Insured? The one eye-opening question movers don’t want you to ask

The moving company you’re talking to is probably insured, but what are they hiding? We’re lifting the veil on what being a licensed and insured Texas moving company actually means.

What does it mean to be a licensed and insured moving company in the state of Texas?

We get this question a lot, so we decided to give you, our customers, the breakdown. 

The Texas Department of Motor Vehicles has mandates for all moving companies in the state. There are many hoops that a moving company must go through to become licensed. Of course, the owner will set up a business name they wish to be known. 

1. First in the process a moving company must apply for a US DOT#. Our TxDMV No is 007049919C 
2. From there the moving company must obtain insurance.
   The insurance requirements are based upon the gross vehicle weight rating (GVWR) of the trucks that the company has purchased. For a truck with a GVWR of 26,000 lbs or more, a moving company must obtain a minimum liability policy of $500,000. For those that have chosen a truck with a GVWR of less than 26,000 lbs, they must obtain a liability policy of at least $300,000. If a company is operating off the minimum insurances, then it will only cover the accident, not for the truck itself. They will have to add additional coverage to cover the vehicle.
3. The other part of insurance coverage is regarding a cargo policy. The cargo policy is set up in the same way as the liability side. If the moving company has a truck with a GVWR gross vehicle weight rating of over 26,000 lbs., they must obtain a cargo policy of $10,000 or more. If they choose to have moving trucks that are under 26,000 lbs. they must obtain a cargo policy of $5,000 or more. This part of the policy covers the items inside of the truck. Yet it will only cover the items during transit of your goods. It will not cover your items if they are damaged by the movers themselves. 

Now that you know a bit about the startup of a moving company, lets go over few more details. Most moving company start ups are typically only able to obtain the basic moving insurance we have gone over. They may opt to raise the policy payouts, yet most will not put up the money that it costs to do so. Reason being, it already would cost them over $1,000 just for the basic coverages.

After a moving company develops a track record for a few years, they have the opportunity to get the coveted Movers Insurance! This insurance covers premises, damage to rented vehichles, each occurrence, med expenses, personal & adv injury, general liability, products—comp/op aggregate. These policies typically range with coverage totals of $1,000,000 to $2,000,000 in each bracket. After obtaining these insurances a moving company can obtain a license with the state of Texas.

It all boils down to this…

Since all Texas moving companies must have insurance to operate, what does that mean when it comes to your items? It means that in case of a vehicle accident, the moving company you choose should have you covered. They should also be covered if something is to occur while in transit. Yet when it comes to insuring your items during the actual moving process it’s a completely different story.

Moving companies must have the following statements written verbatim as written by TxDMv:

(A) Unless the carrier and shipper agree in writing to a higher limit of carrier liability, a household goods carrier’s liability for loss or damage of property shall be $.60 per pound per article. Claims for loss or damage of property may be settled based on the weight of the article multiplied by $.60.

(B) If the carrier and shipper have agreed in writing to a higher limit of liability, the carrier may charge the shipper for this higher limit of liability. If the agreement between the carrier and shipper to a higher limit of liability provides for a deductible, the carrier’s liability to pay for loss or damage of property will be reduced by the amount of the deductible.

Here’s the main issue with that…

Article A is stating that if any mover in the state of Texas damages your items, they only have to pay you $.60 per pound for the item they have damaged. According to the investigator of the TxDMV this is to cover damages or replacement costs. Although as we all know, that isn’t going to solve much which is why they added article B in 2017.

Article B states that you can purchase additional liability from the moving company in Texas that you choose to do business. In other words, you pay to play. For moving companies in Texas, the additional coverage typically means they are adding extra dollars to their pockets. This is because if you the customer are paying extra for them to be careful, they most likely will take extra time (more hours/more money) to make sure they keep the bonus you just gave them.

For some, that extra piece of mind is worth the cost. For those individuals we would recommend to ask your moving company of choice to give you a Binding contract(flat rate) for your upcoming move.

So what’s the solution?

When calling the next moving company on your list, there are a few things to consider with the information given. When a moving company states they are “Licensed and insured for your protection,” that is the polite way of saying they are in business.

What makes a moving company different from the rest is the men they hire to do the work for you the customer. When you hire a mover you can trust, a higher limit of liability may be something you want, but isn’t necessary. A good mover doesn’t need to take extra funds from your pocket, when they are making an honest living. 

So when choosing a moving company in Texas, lean on your own understanding. We recommend researching the moving company on the TxDMV website first to see if they have any active investigations. From there do your homework on a few moving companies in your area. Pull an average of their ratings and reviews across all platforms they are listed, and choose the right moving company for you and your family. And if you have any questions, you are always welcome to reach out to us.

Verifying Insurance and Licensing

Before hiring a moving company in Texas, customers should always verify that they have both liability and cargo insurances as well as proper licensing. The easiest way for customers to do this is by checking with The Texas Department of Motor Vehicles (TxDMV).

The TxDMV regulates all licensed motor carriers operating within Texas and maintains records on their safety ratings and compliance with state regulations. Customers can check the TxDMV website to ensure that their chosen moving company is properly licensed and insured.

Tips for Choosing the Right Licensed and Insured Moving Company in Texas

Check the Company's License and Insurance Information

Before hiring a moving company in Texas, it is essential to check their license and insurance information. You can do this by visiting the Texas Department of Motor Vehicles website. The website provides a database of all licensed and insured moving companies in Texas. By checking the company's license and insurance information, you can ensure that they are legally authorized to operate in Texas.

Ask for Proof of Insurance and Licensing

While checking the company's license and insurance information on the Texas Department of Motor Vehicles website is an excellent start, it is also crucial to ask for proof of insurance and licensing before hiring them. This will give you peace of mind knowing that you are dealing with a legitimate business that has met all legal requirements.

Look for Positive Reviews from Previous Customers

One way to find a reputable moving company is by looking for positive reviews from previous customers. You can do this by searching online for reviews or asking friends or family members who have used moving services before. Positive reviews indicate that the company has provided satisfactory services to its customers.

Make Sure They Offer a Written Contract

A written contract is essential when hiring a moving company in Texas. It should outline all services provided, fees charged, delivery dates, and other important details related to your move. A written contract ensures that both parties understand their obligations and reduces the risk of misunderstandings or disputes.

Avoid Companies That Ask for Large Deposits Upfront

Reputable moving companies typically do not require large deposits upfront. Instead, they many will split payment, one upon pickup and the remainder upon delivery of your belongings. If a moving company asks for large deposits upfront, it could be a red flag indicating potential fraud. A small deposit to hold the day is a realistic expectation.