Garagekeepers Liability Insurance: The Basics

If you run a towing operation, service station, or autobody repair shop, then you’ve most likely come across Garagekeepers Liability Insurance.

But do you know exactly what Garagekeepers Liability Insurance covers and why you might need it?

In this article (or you can watch the video) we explain:

  • What Garagekeeper’s Legal Liability Insurance is,
  • When it applies,
  • What businesses need Garagekeeper’s coverage, and,
  • Why you should purchasing this insurance coverage to protect your business.

Let’s begin…

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Garagekeeper’s Liability Insurance

Garagekeepers Liability Insurance covers liability for, as a towing operation, service station, or body shop, vehicles you d not own that are being held on your property or in a lot that you own and manage.

Let’s say you tow someone else’s vehicle to your lot for holding, whether it’s overnight or for a period of time. While that vehicle is in your care, custody, and control, (while it is in your lot), you are responsible for it whether you deem yourself responsible or not.

If it’s on your property, you have liability for that vehicle. You have liability risk that should something happen to that vehicle while in your care custody and control, the vehicle owner could sue you for the damages.

There are a whole list of things that could happen (vandalized, run into, something could fall on the vehicle, etc), and if anything does happen, you don’t have coverage on a standard policy unless there is either a Garagekeepers Legal Liability endorsement or you have a standalone Garagekeepers Legal Liability policy.

NOTE: In Texas and Virginia, Garagekeepers Liability Insurance is called Storage Location Insurance. Different name, essentially the same policy and coverage.

Who Needs Garagekeepers Liability Insurance?

The answer is any business that is taking care, custody, and control of people’s vehicles and keeping them on their own property or property they manage.

The important information here is that your Business Owner’s Policy or standard General Liability policy will not cover this exposure. This includes Auto Repair Insurance.

You could have a business owner’s policy for a service station, and if you do not have the Garagekeepers Legal Liability endorsement or a standalone policy, you don’t have coverage.

Don’t assume you have this coverage just because you have an insurance policy. Garagekeepers Legal Liability and the corresponding coverages need to be specifically listed on the policy for there to be coverage.

We’ve come across a lot of auto body and service stations that believe they have this coverage because they bought auto repair insurance when in truth, their agent never offered or asked them about adding coverage.

The Rub

This is very important stuff, especially if you carry a large number of cars. You could have a fire. You could have mass vandalism. You could have all kinds of different incidents that could create damage to these vehicles.

If something happens and a 3rd-party’s vehicle is in your care, custody, and control you are going to be held legally responsible in the vast majority of cases.

Garagekeepers Legal Liability is the policy that’s going to protect you and your business.

Don’t assume you have this coverage. Make sure you have it. We can help.

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.

I look forward to introducing you to a new way of viewing your insurance program.

Thank you,

Ryan Hanley

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