Common Exclusions in Garage Keepers Insurance Policies
When running an auto dealership or repair shop, protecting your customer’s vehicles is one of the most important responsibilities you have. That’s why Garage Keepers Insurance is a critical part of your risk management strategy. It covers customer vehicles left in your care—whether for repairs, servicing, or storage. However, many auto dealers and service providers often overlook one key detail: not everything is covered.
Understanding the common exclusions in Garage Keepers Insurance policies helps ensure you are not blindsided by gaps in protection. At Garage Keepers Insurance, we want to educate auto dealers and service shop owners about what to expect, how exclusions work, and how you can fill coverage gaps with the best auto insurance deals available.
What is Garage Keepers Insurance?
Garage Keepers Insurance protects auto dealers, mechanics, and service providers against financial loss when a customer’s vehicle is damaged while in their possession. Whether you run a used car lot, a body shop, or a repair center, you likely need this protection.
It’s important to note that Garage Keepers Insurance is different from auto dealer insurance coverage or dealer auto insurance. While dealer insurance protects your own business operations and inventory, Garage Keepers focuses specifically on your customer’s vehicles.
But like all insurance policies, there are exclusions. Let’s take a closer look.
Common Exclusions in Garage Keepers Insurance
Even the best deal on auto insurance or the best auto insurance deal will contain exclusions. Garage Keepers Insurance is no different. Below are some of the most common exclusions you need to understand:
1. Employee Theft or Dishonesty
If one of your employees steals or damages a customer’s car, it may not be covered under your standard Garage Keepers Insurance policy. To protect against this, you may need to add a specific endorsement for employee dishonesty.
2. Contractual Liability
If your business signs an agreement that increases your liability beyond what is normally expected, your policy may not cover those obligations. This is especially important for auto dealers offering extended services or special financing terms.
3. Faulty Workmanship
Garage Keepers Insurance won’t cover damage resulting from poor repairs or faulty parts installed by your staff. For instance, if an improper brake installation leads to an accident, your policy may not respond.
4. Loss of Income or Use
If a customer cannot use their car because of damage while in your possession, Garage Keepers typically won’t cover the loss of use. That means costs related to rental cars or business losses aren’t included unless you purchase additional coverage.
5. Acts of War or Terrorism
Policies normally exclude damages caused by war, terrorism, or civil unrest. These are considered high-risk, uninsurable events.
6. Natural Disasters Not Listed in Policy
Some policies exclude natural disasters like floods, earthquakes, or hurricanes unless you’ve purchased a rider. If your dealership is located in a high-risk area like Florida, where Florida auto dealer insurance is common, this is critical to review.
7. Intentional Damage
If an employee or the business itself intentionally damages a vehicle, the policy won’t cover it.
8. Racing or Speed Testing
If a customer’s vehicle is damaged while being raced, tested for speed, or used outside normal operations, the insurance will not cover those damages.
9. Criminal Acts
Any criminal acts conducted by the insured party or employees are excluded.
Why Understanding Exclusions Matters
As an auto dealer or repair shop owner, you must understand what your auto dealer insurance company or auto dealer insurance companies provide—and what they don’t. Without this clarity, you could end up with major out-of-pocket costs.
For example, say your dealership experiences vandalism on your lot. While auto dealer liability insurance might cover damages to your own vehicles, it won’t necessarily cover customer cars unless Garage Keepers Insurance is included. Even then, exclusions like employee dishonesty or faulty work might leave you unprotected.
That’s why it’s essential to compare auto insurance deals, evaluate the best auto insurance deals, and find the best deal for auto insurance that meets your business’s unique needs.
Reducing Gaps in Coverage
The good news is that you can minimize coverage gaps by working with the right provider. At Garage Keepers Insurance, we help clients navigate exclusions and strengthen their protection with additional coverage options.
Here are a few ways to reduce risks:
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Bundle Policies – Many businesses save money with State Farm auto insurance bundle deals or similar packages that combine liability, property, and Garage Keepers coverage.
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Add Endorsements – You can add endorsements for employee dishonesty, natural disaster coverage, or rental reimbursement.
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Review Auto Dealer Insurance Requirements – Depending on your state, specific requirements may apply. For instance, Florida auto dealer insurance regulations can be stricter due to weather-related risks.
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Get Multiple Quotes – Always request an auto dealer insurance quote from multiple providers to compare coverage and pricing.
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Understand Your Business Type – Coverage needs differ for new vs. used auto dealer insurance or used car auto dealer insurance.
Balancing Cost and Coverage
Many dealers are concerned about auto dealer insurance cost. It’s true that premiums can vary depending on location, type of vehicles, and claims history. However, choosing the best deal auto insurance doesn’t always mean the cheapest option—it means finding coverage that balances affordability with adequate protection.
Whether you’re a small independent dealer or managing a large franchise, securing the best auto insurance deal requires working with an experienced auto dealer insurance company that understands your risks.
Final Thoughts
Running a dealership or repair shop comes with many responsibilities, and insurance is one of the most important. While Garage Keepers Insurance provides valuable protection, exclusions can leave gaps that you need to address proactively.
By understanding the common exclusions in Garage Keepers Insurance policies, you’ll be better prepared to avoid unexpected losses and keep your business financially secure. At Garage Keepers Insurance, our goal is to connect dealers with the best auto insurance deals—whether that means used car auto dealer insurance, Florida auto dealer insurance, or specialized dealer auto insurance policies.
Don’t wait until it’s too late. Review your policy today, request an auto dealer insurance quote, and make sure you’re not leaving your dealership exposed to costly risks.