What Is Garage Liability Insurance?
Garage liability insurance is a type of insurance coverage designed to protect businesses that operate in the automotive industry, particularly those that involve the storage, maintenance, or sale of vehicles. It provides financial protection against liabilities that may arise from accidents or damages that occur on the premises of the insured garage. This can include coverage for bodily injury, property damage, and legal expenses resulting from lawsuits filed by third parties, such as customers or visitors, who sustain injuries or property damage while on the garage premises.
How Garage Liability Insurance Works
When a covered incident occurs, the garage liability insurance policy kicks in to cover the associated costs. This can include legal expenses, medical bills, and settlement payments arising from lawsuits filed by injured parties.
Garage owners pay premiums to the insurance company in exchange for coverage, and the insurer assesses the level of risk associated with the business operations to determine the premium amount. In the event of a covered claim, the insured garage files a claim with the insurance company, and the insurance company investigates the claim and provides financial compensation up to the policy limits, minus any deductibles.
Types of Businesses That Need Garage Liability Insurance
Businesses that deal with the storage, maintenance, repair, and sale of vehicles should carry garage liability insurance.
Auto repair shops
Car dealerships
Body shops
Auto detailing services
Towing companies
Car rental agencies
Vehicle storage facilities
Motorcycle repair shops
Mobile mechanic services
Tire shops
What Does Garage Liability Insurance Cover?
Bodily Injury Liability
Coverage for medical expenses, legal fees, and damages if someone is injured on the premises of the insured garage.
Property Damage Liability
Protection against claims and expenses if the business causes damage to someone else’s property, such as a customer’s vehicle or neighboring property.
Completed Operations
Coverage for liabilities arising from work completed by the garage, such as faulty repairs or maintenance that result in accidents or damages after the service is performed.
Products Liability
Protection against claims related to defective parts, equipment, or products sold or installed by the garage, which may cause harm or damage to customers or their property.
Legal Defense Costs
Reimbursement for legal fees, court costs, and settlements associated with covered claims or lawsuits filed against the garage.
How Much Does Garage Liability Insurance Cost?
The cost of garage liability insurance is based on several factors, including:
- Type of business
- Location of the business
- Size and revenue of the business
- Claims history and loss experience
- Coverage limits and deductible chosen
- Types of services offered
- Number of employees and their experience levels
- Security measures in place
- Condition and safety features of the premises
- Compliance with industry regulations and safety standards
- Use of subcontractors or third-party vendors
- Prior insurance coverage and lapse history
These factors help insurers assess the level of risk associated with insuring a particular garage operation and determine the premium amount accordingly.
Protect Your Michigan Business with Garage Liability Insurance
Safeguarding your automotive business from unforeseen liabilities is crucial for long-term success. At Melton McFadden, we understand the unique risks faced by businesses in the automotive industry. Our expert team is dedicated to helping you find comprehensive coverage at competitive rates tailored to your specific needs. With Melton McFadden by your side, you can rest assured knowing your business is well-protected against potential risks and liabilities.
Get Quotes for Michigan Garage Liability Insurance from Melton McFadden
At Melton McFadden, we’re here to help life—and business—go right. Get in touch today to learn more!