Most auto dealers are scrappy entrepreneurs with a lot on
their plate. These are independent
business people with no real safety net beyond their own wits and cunning. To survive and prosper, they need to understand
the market value of many different types of vehicles and be able to find and
deliver those cars to a fickle public who rarely trusts them. With all of this going on, they still have to
be garage insurance experts at the same time.
That’s a pretty tall order and confusing terminology doesn’t make things
simpler for them.
Garage insurance is an outlier type of policy in the
insurance world. Garage insurance has
such a specific function and is used for such a small percentage of businesses
out there that most insurance agents just don’t understand it well. A great example of this is the terms garage
liability and garagekeepers insurance. These terms, though they sound similar, have
very different meanings and it is important for the savvy car dealer to clearly
know the difference between these two terms and how these coverages may or may
not be needed to properly protect his or her dealership.
Garage liability is
the term that applies to the liability exposure associated with your autos and
your inventory. For dealers who are only
involved in the sale of cars, this is the protection that you must have in
order to obtain your dealer tags. This
should be the cornerstone of your dealers
insurance program. The most common insurance
claim falling under garage liability happens when someone test drives one of
your cars and causes an accident that injures someone else, or that damages
some property. It is easy to imagine how
one bad wreck that puts a few people in the hospital could bankrupt most small
dealers. So you should always purchase
the highest limits that you can afford when you are considering your garage
liability insurance for your dealership.
Garagekeepers
insurance is quite different from garage liability insurance. Garage keepers insurance is for those dealers
and repair shops that take in cars owned by others and perform repairs on those
vehicles. While both repair shops and
dealers will need garage liability, the garagekeepers insurance is only needed
if for those companies who work on vehicles that are owned by others. While these cars are in your care, custody,
or control, you can be held liable for damages to these vehicles. For instance, if you work on a vehicle, then
test drive it to discover the problem or to listen to a noise, then you could
be involved in an accident that damages the customer’s car. In that case you would need garagekeepers
collision insurance coverage on your policy to protect you from having to pay
for these damages out of your own pocket.
Garagekeepers insurance also has another subcategory of protection,
called garage keepers comprehensive coverage.
This is protection for losses to the vehicles in your care custody and
control that are not caused by collisions.
There are exclusions to this coverage, so be sure that you are familiar
with them but basically this is wind,
hail, fire, theft and other losses of that nature to your customer’s cars that
are left with you for repairs.
Garage insurance is complex with many options to be
understood. And the number of insurance
agents out there who will pretend to understand this coverage and will be happy
to try and learn about it at your risk is astounding. It is truly a mine field out there for
dealers. You need to select and agent
who understands this complicated sector of the business insurance world and who
already insures lots of other dealerships like yours. Clinard
Insurance Group currently insures over 300 used car dealers across the
states of North Carolina, Georgia, South Carolina, Tennessee and Virginia. Our experience in this area, along with our
volume of accounts means that we can help you get the protection you need at
rates that will astound you. If you would like help with your dealers
insurance, please call us, toll free, at 877-687-7557 or visit us on the web at
www.TheAutoDealersHelper.com.
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