Garagekeepers Legal Liability/Dealers Open Lot Insurance

Garage keepers liability insurance may be an optional cost for garage owners, but that doesn't mean that it's not important. They work to protect any vehicles that may be stored on a business' site for practically any reason. Cars are a significant investment in a person's life, and they can usually use all the protection they can get. Learn more about how it works, and what you need to know to make a better decision for your business.

Do You Know What Happens?

Let's say you own a used car dealership where a customer buys a car from you. After they've had it for several days, they take it back to you and say that there's something wrong with it. Your on-site mechanic decides to test it out by taking it for a spin around the block where they manage to hit another car and total both vehicles.

Do you know who's responsible for what? Do you need to cover all costs out of pocket? Will insurance pay for all of it? If so, what kind of insurance and whose? Will it be some combination of the two?  Get in touch with a local, qualified insurance expert who can help you. 

The problem is that those who keep cars on site may not even know the answers to these questions. And it should go without saying that you shouldn't find out these answers after the car has already been crashed.

What Is Garage Keepers Liability Insurance?

This is a type of coverage offered to those with garages. It's designed to protect a customer's vehicle - cars, motorcycles, vans, trucks, etc. when they need to be stored temporarily (garaged). Whether it's a criminal that breaks into your garage or a weather event that causes damage to all cars on site, the policy can help owners assume the responsibility for the damage without sacrificing their business' financial future. It covers the car for the entire time the owner has it, whether they're repairing it, driving it, or storing it.

Depending on the business type different types of specialized coverage is available, some examples - parking garage insurance, auto repair shop insurance, motorcycle repair shop insurance - to name a few.

Customers put a lot of trust into a company when they leave their car somewhere, and they expect to receive their car back in the same condition they had it as before. Without taking the right precautions, owners may find themselves losing direct customers as well as their reputation in a community.

What Does It Cover?

Typically coverage will cover the legal costs for a business if they're accused of damaging their customer's car. If there's any type of negligence lawsuit, owners can be rest assured that they can use their garage keepers liability insurance to cover the legal fees associated with the case. Negligence accusations are common when it comes to garage keepers, so this is the primary reason that a garage keeper may need to employ their liability insurance. However, it also covers direct primary and direct excess. In the case of direct primary, owners would be covered for events even when there was no possible way to prevent them.

This could include the destruction of a garage due to a weather event or the event of a thief breaking into a securely locked facility. In the case of direct excess, liability insurance will pay for anything that may be left over after another type of insurance pays their due. For example, say your commercial insurance covers about 75% of the damages that happen after a natural weather event. Garage keepers liability insurance will pick up the rest of the bill, so the owner can get their doors back open as soon as possible. As you might imagine, this is one of the most comforting clauses of garage keepers liability insurance for owners.
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