What Does a Typical Auto Repair Shop Insurance Cover?
If you own an auto repair shop, you know accidents happen—whether it’s a slip-and-fall, a botched repair, or an unexpected fire. That’s why having the right insurance is crucial. But what exactly does a standard auto repair shop policy cover? Let’s break it down in simple terms.
1️⃣ Garage Liability Insurance – Your First Line of Defense
This covers accidents that happen at your shop, like a customer slipping on spilled oil while inspecting their vehicle. It also includes faulty workmanship coverage, so if an employee forgets to tighten lug nuts and a wheel flies off, insurance steps in to cover damages and injuries.
2️⃣ Auto Liability Insurance – Protection When Employees Drive
If an employee takes a company vehicle to pick up parts and causes an accident, auto liability covers the claim. Likewise, if they’re test-driving a customer’s vehicle and crash, the liability portion of your garage policy covers the damages.
3️⃣ Garage Keepers’ Liability – Coverage for Customer Vehicles
If a customer’s car is in your shop’s care and gets damaged—say, a battery explodes overnight, causing a fire—this coverage steps in. Some shops also require Acts of God coverage (like hailstorms or flooding), especially if they have direct repair contracts with insurers or municipalities.
4️⃣ Business Property Coverage – Protect Your Tools & Inventory
Beyond liability, your policy can also cover your building (if you own it), tools, lifts, diagnostic equipment, office furniture, and even inventory like oil, belts, and tires. Since property coverage is usually only 20-25% of your premium, it’s a cost-effective way to safeguard your shop’s assets.
Why Regular Insurance Reviews Matter
Your shop grows and changes—so should your coverage. An annual review with your agent ensures your policy reflects new equipment, inventory, and any updated contract requirements.
🚗 At The Shop Insurance Guys, we make insurance simple. We walk your shop with you, explain coverage in plain terms, and customize policies to fit your needs.
📢 Don’t settle for a one-size-fits-all policy. Get a tailored insurance quote today!
