As the owner of a vehicle repair shop, it is critical to be aware of the type of coverage you are paying for and what the exclusions on your policies may be. If not, you could find yourself paying more out of pocket once the time comes to file a claim.
This week, we would like to focus on garagekeepers legal liability. There are two specific coverage’s when dealing with garagekeepers legal liability insurance: comprehensive coverage and collision coverage.
Comprehensive coverage will protect a business from any damages that are NOT caused by a collision with another object (for example, a fire, theft, etc.) Collision coverage will protect a shop from any damages caused by the customer’s auto collision with another object or the customer’s auto overturn. Now that you are aware of the coverage, let’s take a look at a possible scenario…
Over Labor Day weekend, your shop is broken into. You soon realize that the thief has not only taken a few of your supplies but also your customer’s 2012 Mercedes Benz. Of course, once the customer is notified, he assumes that your shop will be replacing the stolen vehicle. As the owner, you go to make a claim and feel confident that everything will be sorted out. Sadly, this is not the case. You are denied coverage.
Unfortunately, garagekeepers LEGAL liability coverage will only respond for legally determined liability. In this case, your garage must be found negligent. After analyzing the situation, the insurance company may have realized that your shop has working alarms, a fence, cameras AND lights that should have stopped the situation. The claim is denied because the case is not determined “legally liable.” Would your auto repair shop be able to replace a Mercedes Benz alone?
While this scenario may seem rare and exaggerated, this could very well happen to an auto body shop if the owner is not fully aware of what his or her garage insurance policies will or will not cover. If you have any questions about your own garage insurance policy, do not hesitate to speak with the professionals here at Wolpert Insurance. We want to make sure you understand what you are protected from, especially to avoid an unfortunate situation such as this one!