Garage Keepers Liability Coverage

Companies in the business of storing customer vehicles need to be protected.

Picture this scenario: you are a tow truck driver who is called to tow a car in the middle of the night. Since the mechanic’s garage is closed at this time, you must store the car in your shop for the night. A few hours later, someone breaks into your shop and vandalizes the customer’s vehicle.

Garage Keepers Liability coverage is designed to offer protection for business owners who offer towing services or operate service stations including auto body shops, roadside assistance service providers, auto salvage and auction haulers.

Garage Keepers Liability offers insurance coverage for tow truck owners protects their vehicles while they are kept at the business location for parking, storage or to perform maintenance or services in the event of fire, theft, vandalism, explosion or lightning.

Two types of Garage Keepers Liability coverage are available:

• Direct Primary Coverage – Coverage for a business, even if the loss is not the business’s fault nor are they legally liable.
• Excess Coverage – Additional coverage over the limit of coverage that the vehicle owner/customer has from his/her own insurance company. This will automatically pay if the customer does not have Automobile Insurance.

Garage Keepers Liability Coverage is Designed for:

• Automotive and motorcycle dealers
• Service stations
• Restaurants, hotels and special event operations with valet parking
• Private parking lots and structures and airport parking lots
• Car washes
• Other businesses that accept custody or control of vehicles belonging to others for a fee
• Tow Truck Operators

Limits and Deductibles:

• Determine coverage limits by considering the average value of vehicles in your care multiplied by the average number of vehicles in your care at any given time. For instance, if the average value of your customers’ vehicles is $30,000 and you tend to have 10 vehicles on hand, then you should select a limit of $300,000.
• You must select a per-vehicle deductible (generally $500) that is to be paid by you in case of a damaging incident. Then, the insurer covers the remaining amount, up to your limits.

Exclusions:

• Contractual obligations
• Theft by the insured
• Defective parts or faulty work
• Loss to sound reproducing equipment, unless it is permanently installed
• Loss of CDs and tapes
• Loss to sound receiving equipment (CBs, mobile radios and telephones), unless it is installed in the dash or console
• Radar detection equipment