Useful as standard business insurance policies may be, they aren’t always adequate for the specific risks that a garage repair shop faces.
How can garage repair shop insurance protect you?
Use the yellow hot spots and explore how garage repair shop insurance can help protect against common risks.
Commercial General Liability / Garage Liability
Your repair shop may be susceptible to many risks, such as claims due to bodily injury, property damage, personal injury and more. For example, if a customer accidentally trips and falls while on the premises of your repair shop, you can become exposed to a potential lawsuit and held financially responsible for any injuries that result from the accident.
Commercial general liability insurance is an absolute necessity for every repair shop. This type of protection provides broad coverage for premises, operations, completed operations and advertising and personal injury. It will also pay to defend any covered lawsuit or action regardless of its merit. Coverage can be purchased as a separate policy and can be tailored to your specific needs. Coverage limits generally range from $100,000 to $1,000,000.
Commercial Property Insurance
When a gas tank explosion causes an uncontrollable fire, your commercial property and everything within it can suffer a significant loss. This can have a detrimental effect on your repair shop business.
Commercial property insurance can help protect the property your business owns or leases, including things like equipment, inventory, furniture and fixtures. Whether you own your building or lease your workspace, commercial property insurance can be purchased separately or can be combined with other necessary coverage to protect your business’ physical assets.
Property of Others - Garage Keepers
The nature of your business means you’re responsible for valuable cars, trucks and other automobiles. As a repair shop owner, you’re trusted to safeguard vehicles belonging to others. This responsibility brings with it potential liability of being held financially responsible for property damage caused to these vehicles while in your care, custody and control.
You should purchase physical damage coverage, referred to as garage keepers coverage, designed to help you protect your customers’ property and your business in the event that accidents, injuries or property damage occurs. This protection covers the costs that arise from unfortunate and unforeseeable events, not bad workmanship, faulty parts or warranties.
Inland Marine and Mobile Equipment Policies
You’re constantly moving your tools from one area of your repair shop to another, exposing your business to potential loss due to damage or theft. And without your specialized tools and equipment, your repair job may come to a screeching halt.
You can purchase special equipment insurance designed to protect your tools and equipment on the move. The policy will cover equipment for a variety of losses, including fire, explosion, vandalism, theft, collision with other equipment or objects and overturning.
Workers' Compensation and Employers Liability
If one of your employees receives an injury or becomes ill due to a work-related occurrence, you are required by law to have the proper coverage in place.
Workers' compensation and employers liability insurance protects your employees should a job-related injury or sickness occur during the course of employment. Since benefits vary by state law, make sure your insurance agent is aware of all physical locations your business operates in and all physical locations where you hire your employees.
Business Auto Insurance
As a repair shop owner, you have many exposures associated with your business vehicles – owned or leased. With a fleet of cars, trucks, vans or other types of vehicles used in the course of business, a single accident can potentially put your business in financial jeopardy.
Business auto insurance provides coverage for vehicles owned or leased by a repair shop and provides coverage for bodily injury, property damage and other exposures, and could include comprehensive and collision coverage as well.
Commercial Umbrella / Excess Insurance
Losses and lawsuits are quite common in the repair shop business, and settlements can be substantial. If your business is found to be responsible for damage or injury, you could be facing a large liability loss that exceeds the basic limits of your standard policy.
You should consider purchasing a commercial umbrella or excess insurance policy which provides higher limits, typically between $2,000,000 and $10,000,000, and often broadened coverages. Coverage is extended over your general liability insurance, workers' compensation and business auto insurance. It provides a great safety net and helps ensure your repair shop business is well-protected.
At the simplest level, you need to be protected against damage to customer vehicles stored on your premises, whether this be from fire, vandalism, theft or other hazards. You might only be doing a couple of hundred dollars worth of work on a car, but if you have to spend tens of thousands replacing it, the effects could cripple your business.
You should also investigate professional liability coverage that protects you against claims for damage to a car caused by mistakes and/or omissions by your staff. In extreme circumstances, this could include not just the cost of fixing the flawed repairs, but also costs that arise from a crash that’s blamed on the faulty repair.
Remember also to look for coverage for lost income. If you have a fire, it’s not much use having an insurer pay all the costs of rebuilding the workshop if you lose all your customers in the meantime and your cash flow is irretrievably damaged.
To protect your garage repair shop, contact us today.