Used Car Dealer Insurance: Everything You Need to Know

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Running a used car dealership comes with its own set of challenges and risks. One of the most important things you need to consider is insurance. In this article, we’ll discuss everything you need to know about used car dealer insurance, including the types of coverage available, how much it costs, and frequently asked questions.

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Types of Coverage

Used car dealerships need different types of insurance coverage to protect their business from potential risks. Here are some of the most common types of used car dealer insurance:

Garage Liability Insurance

Garage liability insurance provides coverage for bodily injury or property damage that occurs on your dealership’s premises or as a result of your operations. This type of insurance typically includes general liability coverage, which protects your business against claims of bodily injury or property damage caused by your employees or products.

It’s important to note that garage liability insurance is not the same as commercial general liability insurance. While commercial general liability insurance provides coverage for injuries or damages that occur as a result of your products or services, garage liability insurance is specific to the auto industry and is designed to cover risks specific to dealerships.

Dealer Open Lot Insurance

Dealer open lot insurance provides coverage for damage or loss to your inventory of vehicles, including cars, trucks, and other vehicles that are held for sale. This type of insurance can be customized to cover specific risks, such as theft, fire, or damage from natural disasters.

Garagekeepers Liability Insurance

Garagekeepers liability insurance provides coverage for damage or loss to customer vehicles that are left in your care, custody, or control. This type of insurance is essential if you offer repair or maintenance services, as it helps protect you from claims if a customer’s vehicle is damaged or stolen while in your possession.

Workers’ Compensation Insurance

Workers’ compensation insurance provides coverage for medical expenses and lost wages if one of your employees is injured on the job. This type of insurance is required in most states and can help protect your business from potential lawsuits and other legal issues.

How Much Does Used Car Dealer Insurance Cost?

The cost of used car dealer insurance varies depending on several factors, including the size of your business, the number of employees you have, and the types of coverage you need. Generally speaking, you can expect to pay anywhere from a few thousand dollars to tens of thousands of dollars per year for comprehensive coverage.

To get an accurate quote for your business, it’s best to work with an experienced insurance broker who can help you determine the types of coverage you need and find the best rates from multiple insurance carriers.

FAQ

What are the most important types of used car dealer insurance?

The most important types of used car dealer insurance include garage liability insurance, dealer open lot insurance, and garagekeepers liability insurance. Workers’ compensation insurance is also essential if you have employees.

What does garage liability insurance cover?

Garage liability insurance provides coverage for bodily injury or property damage that occurs on your dealership’s premises or as a result of your operations. This type of insurance typically includes general liability coverage, which protects your business against claims of bodily injury or property damage caused by your employees or products.

What is dealer open lot insurance?

Dealer open lot insurance provides coverage for damage or loss to your inventory of vehicles, including cars, trucks, and other vehicles that are held for sale. This type of insurance can be customized to cover specific risks, such as theft, fire, or damage from natural disasters.

Do I need workers’ compensation insurance?

If you have employees, you are typically required by law to carry workers’ compensation insurance. This type of insurance provides coverage for medical expenses and lost wages if one of your employees is injured on the job.

How can I save money on used car dealer insurance?

To save money on used car dealer insurance, it’s important to work with an experienced insurance broker who can help you determine the types of coverage you need and find the best rates from multiple insurance carriers. You can also consider raising your deductibles, improving your safety records, and implementing risk management strategies to reduce your overall risk.

Conclusion

Used car dealer insurance is essential for protecting your business from potential risks and liabilities. By understanding the types of coverage available, how much it costs, and other important factors, you can make informed decisions about your insurance needs and ensure that your business is properly protected.

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