If your business handles customer vehicles, then you need garage liability insurance. From towing and auto body shops to car dealerships and service stations, it is important to recognize the level of risk that your business faces and then acquire the proper protection to limit these risks. Garage insurance does not just cover automobiles owned by third parties, but also company owned vehicles. Read on to learn what is garage insurance and what it entails.
What Is Garage Insurance?
So, what is garage insurance exactly? Garage liability insurance is a special type of insurance policy designed for professionals in the automotive industry. This may include parking garages, parking lots, vehicle customization shops, repair shops, and more. With garage insurance, your business is protected from bodily injury and property damage resulting from business operations.
Garage liability insurance is a type of umbrella policy that provides extra liability insurance coverage that stems beyond regular limits. With an additional layer of protection, business owners can reduce their risk of financial ruin in the event that a person or property is injured while performing day-to-day operations. The coverage offered under garage insurance is typically not covered under regular commercial or business liability policies.
What Does It Cover?
Not all garage insurance policies offer the same amount of coverage. A standard garage liability policy only covers bodily injuries that occur at your place of business. For example, if a customer suffers a slip and fall injury while walking through your shop, you may be responsible for any medical bills that result. Your garage insurance policy would provide coverage for these medical bills up to your policy’s specified limit.
Oftentimes, garage liability policies also cover liabilities that arise from general business operations, such as when an employee files a discrimination lawsuit. There may also be a dishonesty section in your policy that covers the theft or vandalization of customer vehicles by disgruntled employees. Most garage liability policies cover the following:
- Third-party injuries
- Liability claims, such as discrimination
- Employee dishonesty
- Property damage caused by business-owned equipment
- Products manufactured or sold by your business that result in damage to a customer’s vehicle
Oftentimes, garage liability insurance is confused with garage-keepers insurance. These are two different policies with unique terms. Garage-keeper’s insurance protects you in the event that a customer’s vehicle is damaged while at your place of business. This coverage is not generally included in standard garage liability policies. Under garage-keeper’s insurance, coverage is only provided if certain perils exist that resulted in damage, such as theft, fire, extreme weather, vandalism, or accidental damage like a collision with another vehicle.
What Doesn’t It Cover?
While garage liability insurance provides advanced coverage for business owners, the insurance is not entirely comprehensive. There are certain things that your policy will not usually cover. First, garage liability does not typically cover injuries to employees. This is what workers compensation is for. It will also not cover damage to the garage itself. For this, you will need commercial property insurance.
Garage liability insurance does not apply to client property, such as when client vehicles are brought into your business for repair or other services. If you require coverage for client vehicles, you need to acquire a garage-keeper’s liability policy. If your garage liability insurance policy covers an amount that is less than the total value of the losses associated with the theft, repairs, or third-party bodily injuries, any remaining amount is not usually covered.
Who Should Acquire A Garage Insurance Policy?
After learning more about garage insurance, you may be wondering if you really need this type of policy. If you own any type of business that deals with automobiles, having such a policy can be invaluable. This does not just refer to businesses that repair or customize vehicles, but also businesses like emissions testing sites and valet services. In short, garage liability insurance is for any business that sells, transports, or fixes vehicles.
In some instances, garage liability insurance is required by landlords who wish to protect their assets should a certain business activity result in a claim. Having the proper liability policies can also provide you with peace of mind. Remember, garage insurance does not just cover standard vehicles like cars and trucks. It can also cover individual or fleets of motorcycles, trailers, and tractor-trailers. While garage liability insurance is not mandatory in most states, having coverage could potentially save your business from financial disaster.
Speak To Experienced Specialty Insurance Brokers
The cost of a garage liability insurance policy can greatly range based on a number of factors, such as the annual revenue of your business, the limits that you choose, the coverage options you select, and the deductible you opt for. For more information about garage liability insurance or to acquire a policy for your business, speak to the experienced specialty insurance brokers at JMG Insurance Agency today.