Automobile repair shops can offer a wide variety of mechanical services, from engine repair to tune-ups. They may specialize in a specific type of repair, such as transmissions or brakes. Normally, auto repair shops do not specialize in body work or painting operations, but they will perform those necessary but incidental to other repairs. Other operations may include the retail sales of automobile accessories and tools. Some repair shops are a part of a gasoline or diesel fuel sales operation, or part of an automobile dealership.
Additional services can include towing, auto club affiliations, pickup and delivery of customers and the loan or rental of replacement vehicles. Some auto repair services will have a mobile unit to perform repairs to stranded vehicles or at the customer’s location.
Recommended Insurance Programs for Automotive Service
The most common form of business insurance for an auto repair shop is a garage keepers coverage. A garage keepers policy may include other lines of liability and property coverage within the form, much like a BOP or commercial package policy.
Common Insurance Risks Associated with Auto Repair
General Liability Insurance
General liability (premises liability) exposure comes from slips and falls due to public access to the premises. There is also the attractive nuisance of cars in the parking lots. Customer waiting areas should be provided and customers should not be permitted in the garage area. Floor coverings should be in good condition and no cracks or holes in flooring. Steps and uneven floor surfaces should be prominently marked.
Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls. If the premises are open after dark, adequate lighting and appropriate security for the area must be present. Chains should be in place to prevent entrance after hours.
Garage Keepers Coverage
This type of exposure comes from the physical damage or losses to customers’ vehicles while in the repair shop’s care, custody and control. Your physical lot should be well lit and preventive measures should be in place to prevent vehicle theft. Fences and other security measures may also be appropriate.