Business Insurance For Auto Body & Repair Shops

Auto body & repair shop insurance ensures that your business is covered against various risks specific to the automotive repair industry. This coverage typically includes general liability, workers' compensation, and property insurance, but it's crucial to also consider garage keeper coverage, which protects customers' vehicles while they're in your care, custody, or control.

The applicable NAICS code for an auto body & repair shop is 811121, and this classification covers businesses primarily engaged in providing repair and maintenance services for automobiles, including body repair, paint jobs, and mechanical repairs.

General Liability

Workers Compensation

Auto Insurance

Bond

What's Covered

As an auto body & repair shop, you can perform a variety of tasks under this classification:

Repair and replacement of auto body parts.
Painting and refinishing vehicles.
Mechanical repairs such as brake and engine work.
Vehicle detailing services.
Installation of aftermarket parts like spoilers or fender flares.

Garage Keeper's Coverage

Garage Keeper's Coverage is a specialized type of insurance designed specifically for businesses that provide vehicle repair or storage services, such as auto body shops, repair garages, and service stations. This coverage is essential for protecting your business from potential liabilities related to the vehicles in your care, custody, or control.

What Does Garage Keeper's Coverage Protect

Garage Keeper's Coverage offers financial protection in the event that a customer's vehicle is damaged while under your care. This could include scenarios such as:

Theft: If a vehicle is stolen from your premises, Garage Keeper's Coverage can help cover the cost of the stolen vehicle.
Fire: In the unfortunate event of a fire that damages or destroys a customer's vehicle, this coverage can cover the repair or replacement costs.
Vandalism: Should a customer's vehicle be vandalized while in your shop, Garage Keeper's Coverage will help with the repair expenses.
Collision: If a vehicle is accidentally damaged by one of your employees or during service, this coverage helps cover the costs of the damage.

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EPA 6H Rule Compliance

Spray Booths: The shop must have spray booths that meet EPA requirements to control hazardous air pollutants.
Certified Employees: Employees involved in spray operations must hold valid EPA 6H certificates. These certificates must be renewed every five years through EPA-approved training programs.
Training Manuals: The shop must maintain current training manuals that align with EPA guidelines, demonstrating ongoing compliance and proper employee training.
State Air Permit: A valid state air permit is required for legal operation under the 6H Rule, which is also a key consideration for insurance providers.

Business Owner's Policy (BOP) for Auto Body and Repair Shops

A Business Owner's Policy (BOP) is a vital insurance package for small to medium-sized businesses, including auto body and repair shops. It bundles several key coverages into a single, convenient policy, offering comprehensive protection against a variety of risks that these businesses face daily. The BOP is designed to simplify insurance management while providing robust coverage at a cost-effective price.

General Liability Insurance

What It Covers: General liability insurance protects your business from third-party claims related to bodily injury, property damage, and personal or advertising injury. For an auto repair shop, this could mean covering medical expenses if a customer slips and falls in your shop or paying for damages if a customer's vehicle is accidentally damaged while on your property.
Why It’s Important: General liability is foundational for any business, as it safeguards against common lawsuits and claims that could otherwise be financially devastating.

Commercial Property Insurance

What It Covers: This component of the BOP covers the physical assets of your business, including the building (if owned), equipment, tools, inventory, and even furniture. It provides protection against losses due to fire, theft, vandalism, and other covered perils.
Why It’s Important: For an auto body and repair shop, the physical property, including expensive equipment and tools is critical to your operations. Commercial property insurance ensures that you can quickly recover from a loss and get back to business without significant financial strain.

Workers' Compensation

Coverage: Provides wage replacement and medical benefits to employees injured on the job.
Importance: Required by law in most states, protecting both your employees and your business from legal claims.

Claim Example

Injury Description: James experienced a severe strain in his lower back, caused by improperly lifting a heavy transmission component.
Medical Treatment: James received pain management treatment, physical therapy, and was advised to take rest to recover.
Time Off Work: James was unable to work for 6 weeks and received wage replacement benefits through Workers' Compensation.
Wage Replacement: James received 60% of his average weekly wage as per state Workers' Compensation regulations.
Outcome: James returned to work on modified duties after 6 weeks, gradually resuming his regular tasks.

Excess Liability Insurance (Umbrella Coverage) for Auto Body and Repair Shops

Excess Liability Insurance, often referred to as Umbrella Insurance, is a crucial addition to a business’s insurance portfolio, especially for auto body and repair shops that face significant risks of liability claims. This type of insurance provides an additional layer of protection by extending the coverage limits of your underlying policies, such as general liability, commercial auto, or employer's liability insurance.