Garage Liability 201: Do I Need Direct Primary Coverage?

As a garage or auto body shop owner, you have options when it comes to your coverage.

When purchasing your garagekeepers liability insurance, there are three distinct forms of coverage you can opt for, including: legal liability, direct primary and excess. So, how do you know what level of coverage is best for your venue?

What’s important to remember is that your garage is unique and your coverage is dependent upon your specific operational needs. A legal liability policy, in its simplest form is meant to cover damages to a vehicle held in the garagekeeper’s custody whether it’s for sale, being serviced, repaired or simply parked. Where direct primary coverage differs is that this form of liability coverage mediates loss even if it is not the policyholder’s fault and even if the garagekeeper is not legally liable. Sounds like a dream come true for any garage business, right? Happy customer, covered claims. But like anything that is good for you, there are both pros and cons that need to be weighed.

Still not sure which form of garage insurance is right for you? Let’s say you run a tight ship – play by all the rules – and one night, while a customer’s locked vehicle sits parked, securely in your locked garage, it is burglarized. The damage and loss of goods tallies up to a hefty claim and although you were not negligent in any way, your direct primary coverage takes care of the claim, once submitted through your insurance carrier. Easy, except when that claim affects your premium rate for the next several years. Keep in mind if you operated with a legal liability policy, since you were not legally at fault for the theft that same claim would have had to be filed under the client’s insurance; thus having no affect on your future premiums.

Weighing the value of each form of garage coverage is essential to ensuring your business is protected with comprehensive, inclusive coverage. Furthermore, the most important thing is that the commercial coverage you secure is tailored to the unique needs of your specific venue. Consider your average clientele, your location and the common services you provide to help you decipher your coverage options

Interested in learning more about Garagekeepers Legal Liability? Contact the coverage experts at Wolpert Insurance to discover your specialized commercial insurance options today!