Garage Insurance

What is Garage Insurance?
Your business needs garage liability insurance in addition to commercial general liability insurance if your business handles customer’s vehicles. This includes Automobile dealerships, parking lots or parking garages operators, tow-truck operators, service stations, and customization and repair shops. The policy protects property damage and bodily injury resulting from operations. By combining parts of a commercial general liability policy with parts of a business auto policy, garage insurance protects against the risks associated with your automotive business, including claims for injuries, mistakes, or property damage resulting from work you have done or defective parts that you may have accidentally installed.

What Does Garage Liability Insurance Cover?
A basic garage liability insurance policy covers bodily injury or property damage that occurs at your place of business. For example, if a customer suffers slip and fall injury while walking through 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.
Garage liability policies also cover liabilities that result 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 theft or vandalism of a customer’s vehicle by a disgruntled employee. 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
Garage liability insurance is confused with garage-keepers insurance. These are two different policies with unique terms. Garage-keeper’s insurance protects you if a customer’s vehicle is damaged while at your place of business. This coverage is usually not 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 enhanced coverage for business owners, the insurance is not entirely comprehensive. There are certain things that your policy will not typically cover. For example, garage liability does not cover injuries to employees. You would need workers compensation for employees to be covered. It does not provide coverage to the garage if damaged. You would need commercial property insurance for the building.

Garage liability insurance does not apply to customer property, such as when customer brings their vehicle into your business for repair or other services. If you require coverage for customers vehicle you would 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.

 

Which Businesses Need Garage-keepers or Garage Liability Insurance?

The difference between garage liability coverage and garage-keepers liability insurance is a subtle one but is important. Both are needed in making sure you have adequate protection that fill in any risk exposure gaps.
Garage liability insurance and garage-keepers insurance is not only recommended for auto repair shops, but also for:
• Service stations
• Tow truck operators
• Auto body shops
• Detailing operations
• Auto glass installers
• Oil change and lube shops
• Vehicle painting and pinstriping operations
• Sound repair and installation shops
• Emissions testing sites
• Vehicle interior restoration shops
• Any business that uses valet services
In some cases, garage liability insurance is required by landlords who wish to protect their assets in the event of a claim. Having the right liability policies can provide you with peace of mind and protect your business from a financial disaster. Remember, garage insurance does not only cover standard vehicles like cars and trucks. It can also cover individual or fleets of motorcycles, trailers, and tractor-trailers.

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