Cheapest States to Start a Tow Truck Business

All 50 states side by side: who regulates towing, whether there is a state tow license, estimated insurance for one truck, and typical local tow prices.

Quick answer

Lowest estimated insurance for a one-truck operation: North Dakota (~$8,923/yr), South Dakota (~$8,923/yr), Montana (~$9,030/yr), Iowa (~$9,138/yr), Wyoming (~$9,138/yr). 24 of 50 states have no statewide tow company license — cities and counties issue the permits instead. Insurance is the biggest yearly cost, so it usually decides how cheap a state is to start in.

StateState tow license?Insurance / yr (est.)Local tow (est.)
North DakotaNo (local permits)$6,225–$11,620$154
South DakotaNo (local permits)$6,225–$11,620$154
MontanaYes$6,300–$11,760$155
IowaNo (local permits)$6,375–$11,900$157
WyomingNo (local permits)$6,375–$11,900$157
IdahoNo (local permits)$6,450–$12,040$159
NebraskaNo (local permits)$6,450–$12,040$159
KansasYes$6,525–$12,180$161
MississippiNo (local permits)$6,675–$12,460$165
ArkansasYes$6,750–$12,600$167
West VirginiaYes$100 filing fee$6,750–$12,600$167
KentuckyYes$250 plus $10 per vehicle$6,825–$12,740$168
AlabamaNo (local permits)$6,900–$12,880$170
OklahomaYes$500 original; $250 renewal$6,900–$12,880$170
WisconsinNo (local permits)$6,900–$12,880$170
IndianaNo (local permits)$6,975–$13,020$172
MissouriNo (local permits)$6,975–$13,020$172
VermontNo (local permits)$6,975–$13,020$172
MaineYes$50/yr light wrecker plate; $200/yr heavy$7,050–$13,160$174
TennesseeNo (local permits)$7,050–$13,160$174
MinnesotaNo (local permits)$300/yr optional MnDOT towing weight permit$7,125–$13,300$176
UtahYes$7,125–$13,300$176
New HampshireNo (local permits)$7,200–$13,440$178
North CarolinaNo (local permits)$7,275–$13,580$179
OhioYes$7,350–$13,720$181
GeorgiaYes$7,425–$13,860$183
South CarolinaNo (local permits)$7,500–$14,000$185
New MexicoYes$7,575–$14,140$187
DelawareYes$7,650–$14,280$189
VirginiaYes$112 driver registration (online)$7,725–$14,420$191
ColoradoYes$515 application; $51 per vehicle stamp$7,800–$14,560$192
AlaskaNo (local permits)$7,875–$14,700$194
OregonYes$43 application plus $100 tow board fee$7,875–$14,700$194
HawaiiNo (local permits)$7,950–$14,840$196
WashingtonYes$50 per tow truck permit plus license fees$7,950–$14,840$196
PennsylvaniaYes$350 filing fee$8,025–$14,980$198
ArizonaYes$8,100–$15,120$200
MichiganNo (local permits)$8,175–$15,260$202
TexasYes$8,325–$15,540$205
IllinoisYes$900 application$8,400–$15,680$207
NevadaYes$8,475–$15,820$209
ConnecticutYes$8,550–$15,960$211
LouisianaYes$100/yr State Police storage license$8,625–$16,100$213
MarylandNo (local permits)Class T registration $185/yr (≤26,000 lb) or $550/yr$8,700–$16,240$215
Rhode IslandYes$8,850–$16,520$218
MassachusettsYes$10 annual tow report filing$9,000–$16,800$222
New JerseyYes$9,300–$17,360$229
New YorkNo (local permits)$9,450–$17,640$233
CaliforniaNo (local permits)$9,600–$17,920$237
FloridaNo (local permits)$9,750–$18,200$241

License and regulator facts were checked against official state sources in September 2026. Insurance and tow prices are Tow Truck Pro Academy estimates scaled from national averages ($7,500–$14,000 insurance; $95–$275 local tow), not quotes. Tap a state for its full guide.

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