What Types of Insurance Policies Do I Need as an Auto Dealer?
Every business is unique, so needs may vary depending on your car dealership size, the state where you live, number of employees, and financial capability. Here are some of the most common insurance policies applicable to auto dealers.
General Liability coverage is the foundation of all liability insurance and offers diverse protection to car business owners. General liability provides coverage for bodily injury, property damage, and misleading advertisements, as well as libel, slander or copyright infringement, and similar types of personal injury. This essential coverage pays for legal defense costs, settlement expenditures, and medical expenses as a result of the business operation, subject to the limits of your policy.
Employment Practices Liability Insurance or EPLI
Providing insurance for your company concerning employment practices, EPLI offers protection for employment-related charges such as harassment, wrongful termination, discrimination, breach of contract, retaliation, and other work-related issues. Even if you run a small auto dealership business, as long as you have employees, you would benefit from this policy.
Errors and Omissions (E&O) Insurance
By providing service to customers looking for new and used vehicles, an auto dealership is one of the many businesses included under the service industry. And since your company deals with giving professional advice, E&O is a must for your business. It offers coverage for work that was not done correctly – errors or a critical step missed when providing a service – omissions, that could cause harm to your clients.
Natural calamities and man-made disasters can strike at any time without warning. Business Income provides coverage in such events by making sure that your company can continue doing business as usual even after the calamity. It covers loss of income, helping you cover payroll expenses and other business expenses during the restoration period.
Another type of auto dealer insurance that’s vital for car dealers is Workers’ Compensation. Required by most states within the United States, Workers’ Comp protects both the employee and the employer. Workers’ Compensation covers medical expenses and lost wages as a result of work-related injury or illness. In exchange for this benefit, employers are protected from lawsuits relating to negligence.
Garage Keepers Liability
An optional but essential policy for auto dealers is the Garage Keepers Liability. In the event of damage to your customer’s vehicle, it pays for claims while the vehicle is under your care, custody, possession, or control. Garage Keepers Liability includes coverage for fire damage, theft, vandalism, extreme weather, and collision damages that might occur within your place of business.
Often used interchangeably with the policy mentioned above, Garage Liability provides a different form of protection for franchised auto dealers and related businesses. It offers coverage for bodily injury and property damage caused by an accident that occurred within your shop or business. Garage Liability combines General Liability, Commercial Auto, and Legal Liability into one convenient policy.