garage liability insurance

Common Garage Insurance Claims and How to Make Sure You’re Covered

As an auto dealership owner, you know it isn’t a matter of whether there will be an insurance claim or when. It’s how many. Operating a dealership comes with a lot of varied risks.

Injury is one of the most common insurance claims for dealerships with an onsite service center. The 9,460 automotive service worker injuries reported by the Bureau of Labor Statistics support that fact.  But, many other risks can also cost you if you lack the necessary insurance. 

Garage insurance claims are not one-policy-fits-all. The following common claims need different types of auto dealers’ insurance. You want to make sure you’re covered.

Injury to Employees and Customers

There are many ways to get injured on an auto lot. While an injury is an injury, insurance coverage for injury differs for employees and customers.

Here are some of the most common injuries that result in an insurance claim.

Slips, Trips, and Falls

There are numerous ways someone can slip, trip, and fall at a dealership. Polished showroom floors, service center oil spills, and parking blocks are all insurance claims waiting to happen.

However, a customer who trips and falls over a parking block is not covered under the same insurance as your mechanic who slips in the service center. In most cases, customer injuries are covered by a garage liability policy, while your auto dealer’s workers’ comp covers your employees.

Overexertion, Strains, and Sprains Injuries

According to WebMD, overexertion injuries are the third most common cause of accidental injury in the US. While you have to worry about customers overexerting themselves on your lot, your employees are a different story.

An overexertion injury results from a person pushing themselves beyond their physical capabilities. It often results in injury to the knees, shoulders, or back. Whether under the car or under the hood, performing a task using improper posture can lead to sprains and strains, as can lifting too much weight.

Workers’ comp typically covers these injuries, but you can minimize the number of claims and better protect your employees’ well-being. Put safety procedures in place and ensure employees have the tools and resources to perform their duties without overexertion.

Repetitive Motion Injuries

Repetitive motion injuries are caused by continually making the same motion over long periods. This continual motion can cause damage to nerves, muscles, ligaments, and tendons. The result is often temporary and sometimes permanent pain and injury.

You may see more repetitive motion injuries in employees working on a computer all day rather than a car, but time away from the repetitive motion (and from work) is sometimes necessary. The Occupational Safety and Health Administration (OSHA) has guidelines for minimizing this type of workplace injury.

Cuts and Burns

Employees who work with tools around hot engines and chemicals, like mechanics, have a good chance of getting a severe cut or burn. It is very likely and expected. But, a customer could potentially get a cut or burn while visiting the service center.

As mentioned, garage liability insurance covers an injury to a customer while workers’ comp covers your employees.

Injuries might be the most common type of workplace injury for car dealerships, but your coverage needs obviously don’t stop there. Here are a few more common garage insurance claims for which you’ll want to ensure coverage.

Customer Vehicle Damage

There are too many ways to list how a customer’s vehicle can get damaged while on your lot. It could be involved in a post-repair test drive fender bender with your employee at the wheel. A faulty part installed by your shop could cause damage. A disgruntled employee could vandalize a car.

While some of these scenarios are far less likely than others, damage to cars in an auto professional’s care is not that uncommon. You want the necessary insurance to cover any scenario. But, just as the same type of insurance does not cover both customer and employee injuries, one insurance type does not cover all types of damage claims.

Most damage to customer vehicles is covered by one of two insurance types: garage liability insurance and garage-keeper insurance. An insurance agency specializing in auto dealers’ insurance can help you decide which policies you need and understand what is covered by each.

Natural Disasters

Since most car dealerships display cars outdoors and even leave customers’ cars outdoors, a natural disaster such as hail or flooding could cause a lot of damage.

That natural disaster could also damage buildings and the contents within. Having the right amount of commercial property insurance is paramount, but you might need garage-keepers insurance as well to cover damage to customers’ vehicles.


It would be no surprise that a business that has gas and oil on site could potentially experience a fire causing damage to both company and customer property and the damage could be costly.

As with natural disasters, you hope it never happens, but you want to have enough coverage if it does.


Theft can be another one of those tricky insurance coverage areas. A car could be stolen from the lot. A break-in could result in the theft of tools. An employee could steal something from a customer’s car.

Both garage liability insurance and garage-keepers insurance may be needed to cover all types of theft that could occur on your lot.

Do You Have The Right Garage Insurance Coverage?

There are a lot of varied risks unique to operating an auto dealership that has to be insured. From injuries to property damage, employees to customers, you need to have the right coverages and the right amount of coverages to protect your business.

An agency specializing in auto dealers’ insurance can help make sure you’re fully covered without overpaying. Contact us today so our team can get to work finding you a plan that covers all of your car dealership insurance needs, including garage insurance.

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