Garage Liability Insurance: Cost, Coverage & Providers
Garage liability insurance is a policy needed by auto repair shops, dealerships, tow truck drivers, and service stations. covers third-party bodily injury and property damage caused by garage operations, as well as vehicles in the company’s care, custody, or control. The annual cost of garage liability insurance typically starts between $1,000 and $2,000 per year.
Providers like CoverWallet make it easy to get garage liability insurance for your small business with online quotes and experts on hand to provide individual guidance to make sure you’re adequately protected. Complete a free, no-obligation questionnaire online and get coverage in minutes.
Reading: How much is garage liability insurance
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how garage liability insurance works
Garage liability covers claims similar to general liability insurance, that is, injuries and property damage that your business operations cause to non-employees. however, garage liability specifically covers incidents caused by garage operations, such as a mechanical test drive of a customer’s car. if the mechanic hits another vehicle, the garage’s liability pays for the damage to that vehicle. unfortunately, the customer’s car is not covered. for that, you need garage coverage.
Insurers that offer garage insurance can usually underwrite the policy to include coverage found under general liability, such as advertising and personal injury. This can be a convenient way for business owners in the auto industry to cover their critical exposures through a single policy.
what does garage liability insurance cover
Garage liability insurance covers claims made by non-employees that your garage operations, whether necessary or incidental to your garage business, caused them harm. For example, garage liability insurance is often triggered by:
- Bodily Injury: Medical bills from a provider after you broke your leg while falling in the service area
- Property Damage: A customer’s repair bills after a hydraulic lift broke his laptop
- products and operations completed: a customer’s medical and repair bills after a mechanic fails to tighten the lug nuts when changing their tire
- employee injuries
- damage and injuries caused by contamination
- product recall costs
- professional or organized racing or demolition activities
- theft
- fire
- vandalism
- extreme weather
- collision
- body shops
- auto repair shops
- service stations
- auto glass installers
- emissions test centers
- oil and lubricant change workshops
- retailers
- crane operators
- parking garages
- car dealers
- Workers’ Compensation Insurance – Pays for your employees’ medical bills and lost wages when they are injured on the job, like a mechanic who cuts his finger on a winch.
- Commercial Auto Insurance: Covers third-party property damage and bodily injury when you or your employees cause accidents.
- Commercial General Insurance – Expands the limits of underlying liability policies, including commercial auto and garage liability; It’s usually a more cost-effective option than adding additional coverage to your liability policies.
This coverage extends to the person or company named in the policy, called the named insured, plus the employees, partners, directors and shareholders of the named insured, provided they act within the scope of their duties.
what garage liability insurance does not cover
Perhaps the most important exclusion in garage insurance is damage to vehicles in the care, custody or control of the business. This means that a customer’s claim that their vehicle was damaged or stolen while at your business is not covered. Remember the example of the mechanic who causes an accident while test driving a customer’s car? Because the mechanic was in control of the customer’s car, the shop’s liability insurance usually doesn’t pay for the damage.
Other common garage insurance exclusions include:
garage liability insurance vs. garage keepers coverage
Garage insurance is an optional coverage designed for businesses that keep customers’ vehicles in their parking lots. It essentially covers what is excluded from garage liability, automobiles in the care, custody or control of the business, by paying for repairs when those vehicles are damaged, lost or stolen.
garage insurance covers damage caused by:
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Generally speaking, garage attendants liability insurance only covers damage to or theft of the vehicle itself, not the contents. however, you can add endorsements to include items left in the car.
who needs garage liability insurance
Shop liability, sometimes called auto repair shop insurance, extends beyond the repair facility. The policy is appropriate for any automotive business because it covers damages and injuries related to garage operations, whether or not a vehicle is involved.
Small businesses that typically need garage liability insurance include:
Any business that works on or with vehicles must have garage liability insurance. Some businesses must have coverage to be licensed, but even when it’s not required, garage liability insurance is a smart investment to protect against accidents that turn into financial disasters.
additional types of garage insurance
every small business faces multiple exposures. At a minimum, any business in the automotive industry must have garage liability, in addition to garage keepers coverage if customers leave vehicles with them. however, businesses may also face risks such as property damage and employee injuries, and these require other insurance policies, such as:
garage insurance costs
Yearly garage liability insurance costs typically range from $1,000 to $3,500. This is significantly more than general liability, but that’s because garage insurance covers businesses that face much more risk than most. In addition, garage owners often need other business insurance policies, such as garage insurance and workers’ compensation. this can increase your total annual costs by $2,000 to $6,000.
Typical garage insurance costs & deductible per policy
Your location, specific operations, business income and number of employees are just a few of the factors that affect the cost of garage insurance. To keep costs down, you may want to look for a company that can add garage keeper and liability insurance to a business owner’s policy (BOP). Bops often combine general liability with commercial property for small business owners, so adding garage liability means auto companies can get their critical coverage from a single provider.
main garage liability insurance providers
* quote from liberty mutual provided by our partner commercialinsurance.net.
Not all insurance companies offer garage general liability, so companies in the auto industry may have the best luck using a top-tier commercial insurance broker. this way, they can access multiple companies that write garage liability policies and compare offers.
portfolio
coverwallet is a great option for garage owners and car businesses of all kinds. The insurance partners CoverWallet works with are capable of handling the high dollar value of a thousand cars on a lot or a client’s injuries after slipping in an oil slick. Plus, CoverWallet allows garage owners to easily compare policies online so they can see how much each insurance company charges and compare the cost to the terms of the policy.
farmers
farmers is a national insurance company that specializes in small business insurance and is a good fit for auto repair shops with multiple locations. can provide coverage for cars stored on the premises or being worked on elsewhere. farmers’ agents are available to policyholders seeking better solutions for security and loss mitigation, helping to keep premiums low.
cyber politics
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The cyber policy is ideal for garage owners who need to cover equipment damage, botched repairs, and even personal injury. As an online broker, Cyberpolicy can connect you with a variety of insurance providers offering policies to cover all risks. Applying online is quick and easy, but you can also speak with a representative who can help you find garage liability plus any other policies you may need.
progressive commercial
While Progressive Commercial is a leading provider of commercial auto insurance, the company also offers several key towing and impound lot coverages, including Garage Keepers Liability, Tow Hook and Garage Insurance. . Plus, tow lot owners who get a commercial car and have general liability or a bop can get up to a 15% discount, even if their commercial car isn’t underwritten through a progressive commercial.
mutual freedom
liberty mutual* is a well-known brand that offers garage insurance policies for auto dismantlers, salvage yards and “u-pull-it” companies. Carrier partners with Watson Insurance Agency to bring this hard-to-cover garage liability insurance for business owners, commercial auto, general liability, property, and garage keepers. In addition, policyholders can take advantage of security resources, including access to a security consultant, to help minimize claims and keep costs down.
* quote from liberty mutual provided by our partner commercialinsurance.net.
garage insurance frequently asked questions (faqs)
Buying insurance to protect your business isn’t always easy, especially if you don’t know what to look for. Below are answers to some of the most frequently asked questions about garage liability insurance.
is a mechanic responsible for damage caused by repairs?
Mechanics are responsible for damage resulting from improperly performed repairs. Automotive service companies are expected to professionally perform tasks to keep cars functional and safe. If faulty workmanship results in property damage or injury, garage liability insurance will most likely cover repair costs and medical bills. however, it does not cover the work itself.
For example, suppose a mechanic improperly patches a tire. the owner drives the car and suffers a blowout causing it to crash into another car. the owner’s hospital bills and repairs to the other car are usually covered by the garage’s liability. the mechanic, however, is responsible for replacing the customer’s tire.
what happens if a workshop damages your car?
an automobile under the care, custody and control of a garage is the responsibility of the garage. Garages can obtain a garage liability policy with garage keepers coverage to pay claims for accidental damage to cars in their care. claims on these policies include losses due to perils, such as theft, vandalism, or fire.
Do car dealers have insurance?
Car dealers often need the same insurance that other businesses need, such as business property, general liability, and workers’ compensation. however, most also require liability and garage keepers insurance. dealerships with open lots may also need coverage for wind and hail damage.
end result
Garage liability insurance is an essential policy for businesses in the automotive industry because it protects them if someone claims their garage operations caused injury or property damage. however, business owners often need additional coverage, such as garage attendants, to pay for damage to customer vehicles left in their care.
coverwallet makes it easy to combine these two essential policies into one with your garage business owner’s policy. In five minutes, garage owners can get a competitive quote that covers the biggest risks and includes business interruption coverage, all rolled into one easy-to-understand policy.
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