Garage Insurance – Making The Audit Easier

If you have a garage liability insurance policy for your repair shop insurance, or for your used car dealer insurance program, then you know that your policy must be audited each year. Garage liability insurance audits can be a huge hassle or they can be a quick and easy process. Some of what determines that is up to you. Here are a few tips to make your garage policy audits go as smoothly as possible. Some of this information is based on audit requirements for Auto Owners Insurance Company garage policies and may not necessarily be part of every insurance company’s garage audit process.

Start with an accurate estimate. You will have to estimate your payroll and number of employees when you first take out the policy. Start out by making this an accurate estimate. Estimating too high takes money out of your pocket and crimps cash flow now. Estimate low makes you vulnerable to the audit trap and can hurt cash flow later. Don’t forget that clerical employees are often required to be included in the total employee count. Also, remember that active owners, partners or members are included in the total as one full time equivalent employee.

With the Auto Owners Premier Garage Policy, there are caps on the payroll basis for owners, officers, partners or members as well as for employees. Your insurance company may or may not have caps on payroll so be sure to find out well in advance about this as it can limit your preparation time and may reduce your garage liability insurance costs in the long run.

Most garage policies will not charge for strictly clerical employees. But they are also usually quite strict about the definition of clerical workers. When they say clerical, they mean that employee only engages in clerical work. Few garage operations have a strictly clerical person, but if you do, you don’t want to include them as an employee in the employee audit count and in the payroll count.

Know your categories of employees as defined by the garage policy and have those numbers ready for the auditor. Category 1 employees are usually defined as owners, officers and members as well as salespersons, sales and service managers and anyone who operates vehicles on and off premises. The payroll amount for this type of employee is usually capped and most of your payroll will fall into this category. Category 2 employees are usually defined as all other employees. Typically the payroll for this category will be very small or even zero.

By knowing what your insurance company needs from you at audit time, you should be able to reduce the time and costs of having your garage liability insurance audited each year. At Clinard Insurance Group in Winston Salem, NC, we specialize in helping used car dealers and garage and repair and body shops with their insurance policies. We write garage insurance for dealers as well as repair and body shops in North Carolina, South Carolina, Virginia, Tennessee and Georgia. If we can help you with your garage insurance, please call us toll free at 877-687-7557 and we will be glad to answer your questions.

The source information for this article comes from other articles which can be found at www.InsuranceAnswerGuy.com.

Garage Insurance – Body Shops and Spray Booths

The automobile body repair business is changing quickly. This industry has seen rather slow and evolved changes over the past 30 years or so but recently the pace of change has accelerated. These changes are shrinking your marketplace of clients as well as constricting how you perform your work. Staying ahead of these changes should give you a strong edge over your competition and help to insure that you remain in business for years to come.

One of the biggest systemic changes to affect body repair shop owners is the shrinking customer base. For instance, the high expense of replacing air bags in wrecked cars, combined with the greater availability of less expensive vehicles means that many wrecked cars are now considered a total loss by the insurance companies and as such are not repaired.

In addition, there are changes taking place in the auto body repair industry that drive the way that you operate. There are both environmental and safety issues that will force body shop owners to invest in new equipment and spray booths. Each step forward requires that you carefully evaluate the costs of improvements against future income.

Recent changes to the International Fire Code and the National Fire Protection Agency (NFPA) codes that the vast majority of states and local jurisdictions use now mandate that spray paint booths and mixing rooms have automatic fire suppression systems. This has been a substantial change, resulting in greater protection of spray painting operations, but it increases the cost of the spray booth system. Existing manufactured booths can often be retrofitted with automatic suppression systems, but even that expense can be high. These systems fall squarely in the realm of life safety of those who must work in and around the spray painting operations, where explosive fires are rare but very severe.

The U.S. Environmental Protection Agency has made a new rule, National Emission Standards for Hazardous Air Pollutants (NESHAP) (Subpart HHHHHH), that mandates by January 10, 2011, those that engage in spray applications to motor vehicles must comply. These standards also mandate a spray booth that contains and filters the emissions from spray operations, as well as spray guns that comply and training to the operators of the equipment. The point of this regulation is to protect the environment, but it does mandate the use of an approved spray paint booth. A summary of these regulations may be found on the Internet at http://www.epa.gov/ttn/atw/area/paint_stripb.pdf and http://www.epa.gov/ttn/atw/area/autobodybs.doc.

All of these choices will also drive your insurance costs. If you take the time to keep your spray booth up to date and protect both your environment and your employees, then you will be able to qualify for body shop insurance programs that will offer you the best rates and wider protection. Over time, these changes will begin to pay for themselves in reduced insurance costs.

At Clinard Insurance Group, in Winston Salem, NC, we want all of our clients to be informed insurance consumers. We specialize in helping automotive repair and body shops all across North Carolina and South Carolina with their insurance needs. If you need help with your garage insurance, your workers compensation insurance or any other insurance needs for your auto repair or body shop, please call us, toll free at 877-687-7557 or visit us on the web at NC Garage Insurance Helper.

The source information for this article was pulled from information which can be found at www.InsuranceAnswerGuy.com.