Auto repair shop insurance can be tricky.
The reason has to do with the wide breadth of services and product offerings that autobody shops offer their customers. Everything from tire sales to engine repairs, different makes, and models of vehicles, as well as all the different types of tools and equipment needed to do the work.
Any insurance company willing to provide auto repair insurance is going to want to know:
- Do you do painting?
- Do you do waste removal?
- Are you doing oil changes?
- How are you getting rid of the oil?
- How are you getting rid of tires?
- Is towing part of your operation?
- Are you holding a lot of vehicles in your lot that aren’t being repaired or are in the process of being prepared?
- and more…
All of these answers play an important role in pricing and coverage.
This short video is going to answer your questions about auto repair shop insurance…
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Auto Repair Insurance
When it comes to auto repair businesses, as we explained above, the wide breadth of services, product offerings, types of vehicles, etc, creates the opportunity for gaps in coverage.
Purchasing a standard package policy or standard BOP (Business Owners Policy) from an insurance company that doesn’t specialize in auto repair shop or auto body shop insurance can lead to paying more and/or the wrong insurance coverage.
This doesn’t mean that you need to overpay to find some very specific, niche, hard-to-find program in order to be properly insured.
There are plenty of A-rated standard market insurance companies, (such as Liberty Mutual Business Insurance) that have specific programs for auto repair shops.
It is also incredibly important to take the time to work with a brokerage that understands what you’re doing, is going to walk you through the insurance buying process, and makes sure your business is matched to the right insurance company.
What you don’t want to happen, and we’ve seen far too often specifically with auto repair and auto body shops, is the insurance company doesn’t know about the disposal of oil, waste, and/or tires creating a situation where this activity becomes completely uncovered.
Because waste removal or disposal is a common activity for auto repair and auto body shops and can lead to large claims.
Now, all of a sudden something happens with groundwater or someone from the DEC comes in and is doing an audit and finds that there’s been oil leakage that’s gotten into some sort of water supply. We’ve seen these things happen, especially in some of the older towns and older shops that exist throughout the Northeast and even into the Midwest, and these can be horrible situations.
What Does Auto Repair Insurance Cover?
When purchasing auto repair insurance there are several questions that must be answered in order to get the right coverage at the best price available.
- Does your policy come with a sub-limit for pollution coverage?
- Do you have on-hook coverage if you have incidental towing?
- Do you have garage keepers coverage for all the vehicles that are in different stages of being repaired that are sitting on your lot that your customer’s own?
- Do you have coverage for your lifts, for your equipment?
- Is your building properly insured?
The answers to all of these questions impact the sustainability of your business because there’s a lot of things that can go wrong in an autobody shop.
The most common coverages that you will need for your auto repair insurance program include (but are not limited to):
- General Liablity
- Property (for both your building and tools and equipment)
- Worker’s Compensation
- Commercial Auto Insurance
- Garagekeepers Liability Insurance
- Commercial Umbrella Insurance
The right combination of these insurance coverages will protect your business from the vast majority of claims that could impact your long-term success.
The Rub
Now, you most likely run a very safe, very well-run business and that’s tremendous. When you think about auto repair insurance, think sustainability for the bad days you can’t see coming. That’s why insurance is important, for incidents you can’t predict.
The importance of this mentality is you’re going into the insurance buying process eyes wide open.
You’re making true business tactical decisions and not operating from a sense of ignorance to the gaps in coverage that your auto repair business may face.
I don’t mean ignorance in the negative sense, but rather no one has ever taken the time to explain to you what the risks you face include and where insurance can help protect your business financially.
That’s what we do here at Rogue Risk.
If this is the kind of relationship that you would like with your insurance provider, we would love to talk to you.
- You can call or text us at 518.960.6600,
- Click here to contact us via email.
I look forward to introducing you to a new way of viewing your insurance program.
Thank you,
Ryan Hanley
