Businesses providing automotive services such as auto body shops, parking garages, towing companies and service stations need to protect themselves against a variety of liabilities.
The act of storing customer vehicles alone comes with several risks. Therefore, it’s essential for these businesses to acquire garage keepers insurance. Here is a close look at this form of protection.
What Is Garage Keepers Insurance?
Garage keepers insurance is a form of specialty insurance that shields the vehicles that customers leave with auto repair shops and other automotive businesses.
Depending on the type of business, a vehicle (car, truck or commercial van) may still be parked or stored after it has been serviced.
In fact, it’s during this time period that vehicles may face the most risk of damage. Garage keepers insurance can help auto businesses avoid paying large sums out of pocket in the event that a customer files a claim and sues them.
Types Of Coverage
Most garage keepers insurance policies include three types of coverage: direct primary coverage (which shields businesses regardless of who is at fault for damages), legal liability coverage and direct excess coverage. These coverages offer protection from several different incidents, including:
- Weather-related events
- Vandalism at a business
- Collisions and other accidental damages resulting from negligence (e.g. a mechanic or other employee crashes a vehicle during a test drive)
It’s particularly beneficial to automotive businesses that garage keepers insurance policies cover incidents of theft, as statistics indicate that vehicle thefts in the United States have increased in recent years. Additionally, ValuePenguin estimates that approximately 1 in 5 stolen cars is recovered, although 30% are returned to drivers damaged (with $1,490 in damages, on average).
Exclusions to these types of policies include faulty vehicle parts and workmanship, insufficient warranties, contractual obligations, personal belongings abandoned inside customer vehicles, radar detectors and loss of non-permanently-installed stereo equipment.
Garage keepers insurance also is different from garage liability insurance, which offers businesses protection against claims of bodily injury arising from onsite accidents. This policy typically covers medical expenses for all individuals involved in a crash.
How Much Does Garage Keepers Insurance Cost?
Premiums for garage keepers insurance generally depend on several contributing factors, including:
- The location of the business (state, proximity to major highways, crime levels in the area, etc.)
- Business annual revenue
- The types of vehicles serviced by the business (cars vs. trucks or expensive limos)
- The average number of vehicles cared for/stored per day
- Chosen policy limits and deductibles
According to cost estimate website howmuch.net, annual rates for garage keepers insurance policies are between $1,000 and $1,300 on average. However, some automotive businesses can pay as little as $800 per year, while those who require additional coverage may pay as much as $2,000 annually.
How To Save On Garage Keepers Insurance
There are four notable things you can do to obtain an affordable garage keepers insurance policy:
Compare Multiple Quotes
As with any other type of policy, it’s important to weigh all of your options. Premiums for policies often vary between insurers; compare at least two or three quotes before selecting a policy.
Bundle Your Insurance
Many insurance companies allow garage keepers coverage to be added to the general liability policy. If this option is available, taking advantage of it may provide a discount for combining several coverages.
Assess Your Business’ Risks
Before rushing to choose a garage keepers insurance policy, carefully evaluate the types of risks your business faces. Once you’ve identified these liabilities, choose your limits and deductibles.
Seek Help From An Independent Agency
An experienced and established independent insurance agency will be able to provide invaluable assistance by directing you toward carriers with affordable rates and who are most familiar with your specific business.
Speak To Experienced Specialty Insurance Brokers
Contact the professionals at Pro Insurance Group for more information on the average cost of garage keepers insurance. Our agents are committed to serving as one-on-one advocates for each of our clients, regardless of budget and needs. We also aim to build and maintain long-term relationships with our clients.
If you own an automotive business, it is important to purchase garage keepers liability insurance to protect yourself from certain inherent risks associated with storing and servicing customers’ vehicles. Our policies will shield your business from claims associated with theft, fire, weather-related events and vehicle damages arising from collisions or employee negligence.
If you need additional coverage, we also offer direct excess coverage. Our agents will also help you carefully choose your deductibles and limits based on your unique needs and budget. Call Pro Insurance Group today at 833.619.0770 or contact us online to request a quote or to learn more about our garage keepers insurance policies.