What is Open Lot (Physical Damage)?
Open Lot Physical Damage insurance, commonly referred to as Dealers Open Lot (DOL), protects auto dealers and similar businesses against physical damage to vehicles held for sale. This type of insurance typically covers risks such as theft, vandalism, fire, hail, and collision while the vehicles are stored on the lot or transported between locations. It’s a vital form of property coverage for businesses with inventory exposed to weather and other operational hazards.
Who Needs It
This coverage is most relevant for car dealers, vehicle auction businesses, towing companies, and storage lot operators. Any organization that owns or manages a fleet of vehicles for resale or lease can benefit from Open Lot Physical Damage insurance. Wholesale auto dealers and auction operators often carry this policy to protect their inventory from unexpected damage.
What It Typically Covers
Open Lot insurance typically includes protection against:
- Weather-related events such as hail, windstorms, and floods
- Theft or vandalism of vehicles on the lot
- Collision damage during transport or test drives
- Fire damage due to facility or equipment issues
Some policies may also cover loss during transit, depending on underwriting terms and endorsements. For example, if a vehicle is damaged while being moved between lots, the policy may respond if transportation risks are included.
Common Exclusions or Limitations
Policies may exclude coverage for intentional damage, wear and tear, or losses due to faulty maintenance. Damage occurring during illegal activity or while vehicles are used for non-business purposes may also be excluded. Additionally, coverage limits and deductibles apply—especially for high-value vehicles or lots in areas with elevated risk factors such as hail-prone regions.
Factors That Influence Cost
Several underwriting factors influence the cost of Open Lot insurance:
- Location and climate risks (e.g., hail zones, floodplains)
- Security measures (fencing, lighting, surveillance)
- Total value of vehicles on the lot
- Frequency of transport or test drives
- Loss history and risk management practices
For instance, a dealer with vehicles stored outdoors in a high-theft area may pay more due to elevated liability exposures.
Proof of Insurance & Compliance
Many lenders, floorplan providers, and auction houses require proof of Open Lot Physical Damage insurance before doing business. Having this coverage in place demonstrates sound risk management and helps ensure compliance with contractual obligations. Certificates of insurance can typically be issued quickly once a policy is bound.
How to Get a Quote
To get a quote, businesses will need to provide details such as the number of vehicles on the lot, average unit value, location, and current safety measures. Working with an experienced provider familiar with transportation and auto-related liability is key. Some insurers specialize in auto-related commercial insurance, such as RSG National Specialty Programs - Dealers Open Lot Insurance.
Click here to request a customized quote for Open Lot Physical Damage insurance.
Frequently Asked Questions
Is Open Lot insurance the same as Garagekeepers coverage?
No. Open Lot covers vehicles held for sale, while Garagekeepers is for customer vehicles in your care, custody, or control.
Does it cover damage from natural disasters?
Yes, most policies cover weather-related damage such as hail, floods, or wind—subject to policy terms.
Can I get coverage for vehicles in transit?
Some policies include transit coverage; be sure to ask your insurer to include this if needed.
Is coverage required by law?
No, but many lenders and business partners require it as a condition of doing business.
How quickly can I get proof of insurance?
Once your policy is issued, proof of insurance can usually be provided the same day.
Still have questions? Talk to a local insurance expert.