garage liability insurance

Garage Liability Insurance: Essential Protection for Your Garage Business

Tailored for automotive companies such as car dealerships, repair shops, and parking garages, garage liability insurance is a specialized variant of commercial general liability insurance. It shields against bodily injury and property damage claims arising from business operations. This encompasses injuries clients may suffer on the premises or damages linked to installed products or provided services.

Understanding The Operations of Garage Liability Insurance

Garage liability insurance is a special kind of insurance that businesses dealing with vehicles get. Whether selling, fixing, servicing, or storing vehicles, this insurance has its back.

It takes care of the costs if a customer gets hurt or if their property is damaged while on the company’s premises or because of the company’s work. It also helps with legal expenses if there’s a lawsuit involved. So, it’s like a safety net for vehicle-related businesses.

If something happens to a customer’s stuff, like their bag or phone, this insurance helps cover the damage cost. But when it comes to their vehicle, like a car, you will need another kind of insurance called garage keepers liability policy.

Regular general liability insurance only covers the unique risks of these vehicle-related businesses. That’s why garage liability insurance is essential and gives financial protection where others might not.

Not Covered By Garage Liability Insurance

Garage liability insurance won’t help if the business’s stuff, like tools or the building, gets damaged or stolen. And it doesn’t cover the vehicles owned by the company or its employees.

This insurance will not provide coverage if an employee becomes injured or ill. For that, you’d need workers’ compensation. So, garage insurance has limitations. It’s more about customers and what happens on the business premises.

Garage liability insurance won’t help if something happens to a customer’s vehicle while it’s with the business. For that, you’d need another kind of insurance called a garage keepers liability policy.

The garage keeper’s liability policy covers fire, theft, vandalism, and even accidents when an employee is driving the vehicle. So, it’s like an extra layer of protection for the customer’s ride.

Who Should Get Garage Liability Insurance?

Getting garage insurance is smart if you run a business dealing with cars, like a repair shop or dealership. Because it gives you financial protection in case someone gets hurt or something gets damaged at your place or because of the services you provide.

So, whether you own a body shop, repair shop, dealership, or even a towing or impound lot, insurance is like a safety net for your business.

garage liability insurance

Price Tag On Garage Liability Insurance

The cost of insurance can change depending on a few things. Factors like your past claims history, the amount of coverage you go for, and the services you provide all affect how much you’ll pay.

Getting Garage Liability Insurance: A Step-by-Step Guide

Contact an insurance company, agent, or broker if you want to buy garage insurance. Ask them about the different options for your business. It’s crucial to grasp what’s included or left out in any policy you get a quote for. This way, you can determine if you need extra coverage to keep your risks in check.

The Ins And Outs of How Garage Liability Insurance Operates

Garage insurance acts like an umbrella, giving extra coverage for daily activities in the automotive industry. It adds a layer of protection to the business’s general liability policy. This coverage includes bodily injury and property damage directly related to garage operations, often not included in standard commercial or business insurance. Before getting a policy, business owners should double-check that the garage liability coverage will add to their primary business liability coverage, not just a replacement.

 The coverage will take care of injuries to customers on the business premises up to the chosen policy limits. Additionally, many garage insurance policies include a provision for employee dishonesty, covering theft or vandalism by an employee affecting a customer’s car. 

Added protections might cover damages from parts or products sold by the company and losses from faulty parts installed on a client’s vehicle. Garage insurance doesn’t extend coverage to the policyholder’s tools, buildings, personal belongings, or business property. It doesn’t protect against vandalism, stolen vehicles, or damage caused by events like hail.

The policy doesn’t cover accidents or damage to customer cars on-site for service. Additionally, the policy’s essential and added items will have a maximum liability coverage amount, and aggregate limits may exist per claim or year. Commercial general liability (CGL) insurance policies come with different coverage levels. This insurance might cover the premises, safeguarding the business against claims on-site during regular operations. It could also cover bodily injury and property damage caused by finished products.

Understanding The Difference: Garage Liability Vs. Garage-Keeper Coverage

Garage-keeper insurance is a unique policy created to safeguard against property damage to a customer’s car while in the policyholder’s care. This coverage extends to incidents like damage during road test drives and while storing the vehicle outside working hours. It also protects against vandalism and theft of a customer’s car. A business with multiple locations needs separate policies for each site.

Explore Additional Insurance Options For Your Business

Businesses can also buy coverage for other risks they might face.

Insurance for Different Situations in Your Business:

1. Dealing with Employee Issues: Employment practices liability insurance helps with claims related to sexual harassment and discrimination.

2. Professional Slip-Ups:  Professional liability coverage steps in if there are claims of mistakes or not meeting expectations.

3. Protecting Your Stuff:  Property insurance covers equipment, signs, inventory, and furniture if there’s a fire, storm, or theft. But remember, you might need extra coverage for events like floods or earthquakes.

4. When Things Go Sideways:  Business interruption insurance helps compensate for lost income during events that mess with regular business operations, like an extended power outage.

“Keeping Your Workers Safe”

garage liability insurance

5. Must-Have Protection: Workers’ compensation insurance is a must for employers. Its purpose is to ensure that employees receive necessary medical care in case of on-the-job injuries. Plus, it covers lost wages and benefits the family if a worker tragically passes away.

6. Looking Out for Everyone: ┬áSometimes, a company might want extra protection. Let’s say an auto repair shop teams up with another company for car washing. Other companies can ask the garage owners to add them as extra insured on their liability coverage. It’s an added level of security.


Garage liability insurance covers bodily injury and property damage claims arising from business operations in automotive companies such as car dealerships, repair shops, and parking garages. It includes injuries customers may suffer on the premises or damages linked to installed products or provided services.

Garage liability insurance does not cover damages to the business’s property, such as tools or the building, and it excludes coverage for vehicles owned by the company or its employees. It also does not provide coverage for injuries or illnesses to employees; for that, workers’ compensation insurance is needed.

Businesses dealing with cars, including repair shops, dealerships, towing or impound lots, and parking garages, should consider getting garage liability insurance. It serves as a safety net, offering financial protection in case of customer injuries or property damage related to the business’s services.

Garage liability insurance covers bodily injury and property damage related to business operations. In contrast, garage-keeper insurance safeguards against property damage to a customer’s car while in the policyholder’s care. Garage-keeper coverage includes damage during test drives, storage outside working hours, vandalism, and theft of customer cars.

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