Identifying what types of garage insurance you need for a dealership can often be puzzling. If you are an automobile or motorcycle dealer engaged in sale or repair of them, you most likely need both garage keeper’s insurance and garage liability insurance.
When selecting a policy, people tend to confuse the two types of insurance or lump them together as one entity. Both are necessary for full coverage. While some policies do combine the two, it’s important to understand the differences in order to guarantee that you’re insured to the extent necessary for your business.
Garage keeper’s insurance provides protection for automobiles owned by customers that are in care, custody or control of the dealership or mechanic.
Garage liability insurance provides protection to an injured third-party that could result from operation of autos and other dealership or mechanic operations.
When customers leave their vehicles at a garage to be inspected, repaired, etc., they trust the garage to be liable for any damages that occur. Garage keeper’s coverage protects the garage from a claim made by a customer whose vehicle becomes damaged in the garage’s custody.
Garage keeper’s insurance offers 3 options:
Legal Liability Garage keeper’s insurance provides coverage for a customer’s vehicle damaged due to the dealership or mechanic’s negligence, such as the customer’s vehicle being left unlocked after hours.
Direct Primary Garage keeper’s insurance covers customer’s vehicles even if the garage is not at fault – such as a natural disaster.
Direct Excess Garage keeper’s insurance covers customer’s vehicles similar to Direct Primary, but in the event of the dealership or mechanic shop not having liability, it will only pay in excess of any other collectible insurance.
Garage Liability insurance covers the dealership or mechanic’s legal liability to pay for the damages to an injured-third party, such as bodily injury, property damage, advertising injury, or personal injury. This includes during operation of vehicles owned by the business, being held for sale, or being used in business operations.
The number of customers’ automobiles in their care and the average value of each of them determine the coverage necessary for a dealership or garage. Knowing which type you need for your business can be confusing. At AIIS, we are dedicated to helping you understand all the risks you face associated with garage operations to ensure you have a policy that meets all your insurance coverage needs.
Contact us today to learn more and obtain a quote for Garage Keeper’s Insurance.