Auto Repair Service Insurance

Garage liability is liability coverage designed for auto repair and service operations. It can address certain claims tied to the shop's premises, business operations, repair work, and completed work.

Garagekeepers coverage addresses physical damage to a customer's vehicle while it is in the shop's custody or control.

A repair shop may need both because a claim involving a customer vehicle can be handled differently depending on what happened, where the vehicle was located, who was driving, etc.

Customer vehicles are usually addressed through garagekeepers coverage.

Garagekeepers coverage may help address certain losses involving a customer vehicle while it is parked at your shop, stored overnight, moved inside the shop, lifted for repairs, or otherwise in your custody or control.

Coverage depends on the policy, what caused the damage, where the vehicle was located, who was responsible for it, and what limits or exclusions apply.

A stolen customer vehicle may involve garagekeepers coverage, depending on how the policy is written.

The claim may look at where the vehicle was stored, whether it was in your custody or control, what security procedures were in place, whether keys were secured, and what limits or exclusions apply.

If customer vehicles are kept overnight or parked outside, review garagekeepers coverage, lot procedures, key control, lighting, cameras, and documentation.

Damage to a customer's vehicle inside the shop may involve garagekeepers coverage, but the cause of the damage controls the insurance issue.

A claim may involve fire, theft, vandalism, collision, lift damage, employee handling, or another covered cause of loss. The policy terms, limits, deductibles, and exclusions determine how coverage applies.

Your shop should understand how customer vehicles are covered while they are parked, moved, lifted, repaired, or stored.

A test-drive accident can involve more than one coverage.

Garage liability, garagekeepers coverage, or another part of the policy may apply depending on who was driving, why the vehicle was being driven, what happened, and how the policy is written.

If your shop test-drives customer vehicles, review who is allowed to drive, how test drives are handled, and how accidents involving customer vehicles are covered.

A repair-related accident can involve completed operations, faulty workmanship, product liability, resulting damage, and the cost to correct the repair itself.

Coverage depends on the policy, the work performed, what failed, when the accident happened, and what damages are being claimed.

If a customer alleges that repair work contributed to damage, injury, or an accident after the vehicle leaves the shop, review how your policy treats completed work and resulting damage.

Faulty workmanship claims require careful review.

A policy may respond to certain resulting damage claims, but it may not pay to redo defective work, replace a faulty part, or correct poor workmanship. Exclusions, completed operations coverage, garage liability, and the facts of the claim all affect the answer.

Your shop should review how the policy handles repair mistakes, comeback claims, completed work, and resulting damage.

Employee-owned tools may not be covered the same way as tools owned by the business.

Some policies limit coverage for employee-owned property or require it to be specifically included. If technicians bring their own tools to the shop, ask your insurance agent how those tools are covered, what limits apply, and what documentation may be needed.

Shop equipment is usually reviewed under business personal property, commercial property, and equipment breakdown coverage.

Business personal property can help protect equipment owned by the shop at the business location. Equipment breakdown may help with certain covered equipment failures. The right approach depends on what equipment the shop owns, how it is valued, and what losses the policy covers.

Business income coverage can help replace certain lost income and extra expenses if a covered loss forces your shop to close or operate in a limited way.

Coverage depends on the policy, the cause of the loss, waiting periods, limits, exclusions, and how long it takes to repair or reopen the shop.

Pollution liability should be reviewed because auto repair shops can have cleanup, disposal, spill, or contamination exposure.

If your shop stores, uses, transports, or disposes of materials that could create environmental concerns, this exposure should be discussed.

If your shop does not own or lease vehicles, you may not need a commercial auto policy.

You should review Hired and non-owned auto coverage if employees use personal, rented, borrowed, or non-owned vehicles for parts runs, errands, customer pickup or drop-off, or other work-related driving.

If employees drive customer vehicles, that should also be reviewed separately because customer vehicle use may involve garagekeepers coverage, garage liability, or another part of the insurance program depending on different scenarios.

If your shop offers towing, commercial auto coverage should be reviewed around tow trucks, drivers, towing operations, and vehicles being transported.

Towing can also create questions involving garagekeepers coverage, on-hook coverage, liability, customer vehicle damage, and contracts if towing is provided for another business or organization.

Your insurance agent should know whether towing is occasional, regular, or a major part of the business.