As the owner of an auto body and repair shop, it is no secret that the risks your business will face are unique and just about endless. Luckily, garage insurance can be designed to cover every scenario possible.
Take this situation for example…
You have just finished fixing Mr. Smith’s high priced car when a man enters the shop claiming that Mr. Smith has sent him to pick up the vehicle. You check to see the status of the repair. Noting that the repairs are complete and the deductible is paid, you release the vehicle to the gentleman. Several hours later, Mr. Smith comes in and asks about his vehicle. It is only then you realize that the gentleman you gave the vehicle to was not actually sent by Mr. Smith. Does your MA garage insurance cover this?
Generally, policies include a voluntary-parting exclusion, which bars coverage when an insured voluntarily parts with property “if induced to do so by any fraudulent scheme, trick, device or false pretense.” If unendorsed, your policy may not respond.
To get coverage for Mr. Smith’s auto, it would be necessary to buy false pretense coverage. Sounds reasonable, right?
Now, what happens if you have a sneaking suspicion that a relative, long-time employee or close friend had something to do with the situation? Would you want to file a claim?
Typically, when this coverage is purchased, the insured is held to higher standards by the company. Generally, the insured’s duties in the event of a loss, such as the scenario described above, would include taking all reasonable steps to cause a warrant to be issued for the arrest of anyone involved. Failure to cause such a warrant to be issued may invalidate the coverage otherwise afforded. So, if you are looking to get paid from the company for this claim, it may come with a big price tag for someone you never intended or hoped to hurt.
At Wolpert Insurance, we want to make sure you are 100% protected. Many times, it is best to take typical policies a step further and look into the specialized garage insurance options, such as false pretense coverage. Never hesitate to speak with one of our experts if you have any questions or concerns!