As an auto body shop or garage, you’re working with one of your customers’ most expensive possessions. In addition to potential damage to their cars, there’s the chance that a problem with your work could cause an accident. You also have the usual business risks like a slip and fall. To protect yourself, you need auto body and garage insurance.
What is Auto Body and Garages Insurance?
Auto body and garages insurance is a special business insurance package. You can select all of the coverages your shop needs.
Do Your Needs Depend on What Type of Work You Do?
Yes, depending on what type of shop you run, your insurance needs will vary. If you work on brakes or tires, your work is on the frontline of your customers’ safety. If you only work on stereos and other electronics, you have much less risk of causing an accident or other damage, but you’re still responsible for your customers’ cars while they’re in your possession.
What Are Your Coverage Options?
These are the most common coverages you may wish to include.
Commercial General Liability
Commercial general liability is a standard liability policy that almost every business should have. It can include claims like a customer slipping on ice in your parking lot or you accidentally breaking a window while mowing your grass.
When customers leave their cars with you, you’re responsible if something happens to the car. For example, your garage might catch on fire, or one of your technicians might back into something. Even a theft by an outside party could potentially be your responsibility if a judge believes that you didn’t take appropriate precautions to prevent thefts.
Commercial Auto Insurance
If you have tow trucks, courtesy vehicles, or any other vehicles you use in your business, you need commercial auto insurance. Commercial auto protects you from accident liability as well as damage to your vehicles.
You may have a burglary, fire, or other damage to your building or equipment. Property insurance covers repairs and replacements up to your policy limits.
Employee Theft Liability
Even if you screen carefully, an employee may steal a customer’s belongings out of their car or their car. Employee theft coverage reimburses the customer for their loss.
Most auto work creates the risk of your employees getting hurt. Workers compensation pays for their lost wages, medical bills, and other expenses. It’s required by law in most cases, and it also keeps you from getting sued for the same costs.
Business Interruption Insurance
Business interruption insurance protects your revenues when you’re forced to shut down by a covered cause. For example, a fire might destroy your shop. Business interruption coverage replaces the income you lose while you set up your new location.
Commercial Umbrella Insurance
If you need additional liability coverage to guard against large lawsuits and protect your assets, commercial umbrella insurance may be the most effective way to do it. Umbrella insurance adds additional liability coverage on top of all of your liability policies instead of you paying to increase them individually.
When Are Your Customers Covered?
Your commercial general liability insurance generally protects customers while they’re on your premises. However, your insurance policy and other safety standards may require you to restrict access to certain areas where the risk of a customer getting hurt is greater. If you don’t follow these requirements, you may find that your claim is excluded. It’s important to balance being open with your customers and explaining what’s going on with their car with these safety requirements. Your insurance agent can help you develop procedures that meet both goals.
How is Auto Body and Garages Insurance Priced?
Few shops are exactly the same, so insurance costs may vary widely. The insurance company will look at things like the type of work you do, the size of your shop, and what kind of training your employees have. If you add or remove services, expand, or make other changes, it’s important to update your insurance policy to make sure that you have the right coverage and aren’t paying for options you may no longer need.
How is Auto Body and Garages Insurance Different From a Business Owner’s Policy?
A business owner’s policy is a more general type of insurance package targeted towards all businesses. It may not have garage-specific coverages like damage to a customer’s car. In some cases, the insurance company might start you with a business owner’s policy and customize it with special coverages. Others will sell dedicated auto body and garages policies.
Can’t Your Customers File a Claim With Their Insurance?
A customer’s comprehensive coverage may pay them for damage that happens to their car in your shop. However, you would still have liability. The insurance company could sue you for what they had to pay their customer. Your customers also won’t want to deal with the hassle of filing an insurance claim and possibly having their rates go up. In addition, most people will want to see that you have insurance before they use your services.
Get Help From Your Insurance Agent
Your independent insurance agent can help figure out which coverages your shop needs and how much coverage you should carry. Sagen & Associates Insurance has locations in Shawano and Brodhead, WI. Contact us now to request more information or to get quotes from multiple insurance providers quickly.