Does Your Garage Have Defective Product Coverage in Place?

As the owner of an auto body and repair shop, it is important to have a full understanding of your coverage. If not, you may find that your auto body and repair shop insurance has exclusions.

A common exclusion to be aware of: defective product coverage. Let’s take a look at a scenario…

Your auto body shop has installed a new engine in a client’s vehicle. A week later, you find out that the engine caught fire while the client was on a road trip and destroyed the entire vehicle. The final verdict: there was a defective part in the engine. The client comes back to your shop asking to be reimbursed for both his vehicle and the defective engine.

The first thing you may do is turn to your insurance agent to report the loss. However, many auto body shop owners will be DENIED because there is no coverage in place for a defective product. Why is this? Chances are your policy contained a Defective Products Exclusion, stating “Property damage caused by any of the insured’s products because of damage caused by a defect in the product or any part of it is not covered.”

Are you aware of the exclusions on your garage insurance policy? Our experts at Wolpert Insurance would be happy to go over your existing policy and make sure you are 100% protected from all types of scenarios, including this one. Just give us a call at (800) 299-6819!