Operating a business that works on vehicles has unique liability risks that can be insured through a garage owner’s policy. A garage liability policy provides protection for liability exposures in garage operations for claims from bodily injury and property damage. There are two coverages that should be considered when purchasing a policy – Garage Liability and Garage Keepers Legal Liability.
All business owners should have liability coverage. This is for slip-and-fall liability, covered under premises and operations, and products and completed operations coverage, for work performed. This covers your business for bodily injury and property damage claims caused to others as a result of your business activities. This is not a warranty of your work, but protection for damage to a customer as a result of your work. An example would be if a customer asked to have a carburetor rebuilt on their classic car and upon completion the customer calls and says the fuel line wasn’t tightened and the leak caused a fire. In this circumstance, the insurance carrier would protect you for the damage to the customer’s car caused by failing to tighten the fuel line.
Garage Keepers Legal Liability
One of the most important coverages is Garage Keepers Legal Liability- GKLL. When added to a garage owner’s policy it provides protection for damages caused to customers’ vehicles while in your care, custody, or control. The best GKLL form is to make sure that Direct Primary coverage is purchased, as this is preferred.
Direct Primary coverage will recognize the loss regardless of whether or not your garage was legally liable for the damages. This can make adjusting the claim and satisfying the customer a win-win should the need arise.
RevPro is a proprietary business insurance program of Alliant Insurance Services, Inc. (CA License No. 0C36861) and the only endorsed agent serving SEMA membership nationally.
Alliant note and disclaimer: This article is designed to provide general information and guidance. Please note that prior to implementation, your legal counsel should review all details or policy information. Alliant Insurance Services, Inc. does not provide legal or tax advice, or legal or tax opinions. If a legal or tax opinion is needed, please seek the services of your own legal or tax advisor. This article is provided on an “as is” basis without any warranty of any kind. Alliant Insurance Services, Inc. disclaims any liability for any loss or damage from reliance on this document.