If you have a new or used dealership in Kentucky, you are required by the Motor Vehicle Commission to have this coverage. If you own a body shop, transmission shop, or anything similar you’re putting yourself at risk financially if you don’t have this coverage. Now, there are several different insurance coverages you need to protect you and your business financially and the reputation you’ve built. For this video, we’re going to talk about Garage Liability Insurance.
One area of insurance we focus specifically on is insuring garage and dealership operations. From one-man shops to large franchise dealerships, we’ve built insurance programs for each level of your business.
So…what is “Garage Liability” insurance? Let’s not overcomplicate this. On a basic level, garage liability insurance provides you with coverage and protects you financially if your dealership or garage business would otherwise be liable for an accident caused by your day-to-day operations.
What is this insurance jargon?
Okay, but really…what does that even mean?
Let’s say you have a dealership. One of your employees is driving their demo home and he or she causes an accident. Your garage liability coverage could kick in to pay for the repairs of the other vehicle as well as their medical bills in the accident.
Another example…You have a body shop so you have your customer’s vehicle while you’re fixing it, right? You complete the repairs so your employee takes it for a test drive, but causes an accident. Again…garage liability insurance can pay for repairs of the vehicle you or your employees hit as well as potential medical bills of the people in the other car.
What Can Garage Liability Insurance Cover?
Where else could garage liability insurance come into play?
You change a customer’s brakes, they’re driving down the road, the brakes go out, and they cause a wreck. The liability coverage could kick in to cover the damage to the vehicles and medical bills for those injured.
With most liability insurance coverages, something else also included is the cost of legal fees if you get sued from a covered claim. You likely have at least $1,000,000 in garage liability coverage. What can you use that for? That coverage can pay both your legal fees of a covered claim and fix the other person’s car and medical bills.
What does Garage Liability Insurance NOT Cover?
We have a clear handle on Garage Liability insurance now, right? It’s equally important to understand what garage liability insurance does NOT cover. That demo your employee was driving home after work where he or she caused an accident? Remember, garage liability kicked in to fix the other person’s car, but it won’t kick in to fix your car. Coverage for that applies to your dealer blanket or inventory coverage.
And do you remember that customer’s car you fixed and took for a test drive before calling them before causing a wreck? Garage liability insurance will not fix your customer’s car. That coverage would only be provided by garage keepers coverage.
You want happy customers and the best reputation around town, right? There are ways to cover these claim examples we’ve mentioned, but it’s important to remember what garage liability insurance covers versus what it does not cover.
Next Steps
If you have a dealership or garage business and have more questions about your insurance program give us a call, email me at asheridan@rbisomerset.com. Check out our other videos for your garage or dealership business. You can find them here on our website or our YouTube channel.
We look forward to working with you.
