How Auto Dealer Insurance Differs from Garage Keepers Insurance Costs | Garage Keepers Insurance
When it comes to protecting your automotive business, two of the most important policies are auto dealer insurance and garage keepers insurance. While both types of coverage may sound similar, they serve different purposes and have different cost structures. At Garage Keepers Insurance, we help business owners understand how these coverages work, why they matter, and how to find the best auto insurance deals for their specific needs.
If you’ve ever wondered about the differences between these policies, this guide will break down everything you need to know—especially about the costs and requirements that set them apart.
Understanding Auto Dealer Insurance
Auto dealer insurance is designed for businesses that sell vehicles, whether new or used. Dealerships face unique risks, from accidents during test drives to property damage on the lot. That’s why auto dealer insurance coverage usually includes:
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General liability insurance – Protection if a customer gets hurt on your property.
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Auto dealer liability insurance – Covers damages if a customer’s car is damaged while in your care.
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Inventory protection – Essential for dealerships with dozens (or hundreds) of cars on their lot.
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Property coverage – Safeguards buildings, signage, and equipment.
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Auto dealer bond insurance – A licensing requirement in many states.
Businesses seeking used auto dealer insurance or used car auto dealer insurance also need specialized coverage that addresses the risks of selling pre-owned vehicles, which often come with higher liability exposure.
The auto dealer insurance cost varies widely depending on the size of the dealership, the number of cars, and the state requirements. For example, Florida auto dealer insurance has different compliance rules than policies in Alabama or Illinois.
Understanding Garage Keepers Insurance
On the other hand, garage keepers insurance is designed for businesses that service or store customer vehicles rather than sell them. Think of body shops, repair shops, auto glass installers, car washes, or towing companies.
This coverage protects customer vehicles left in your care for:
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Damage caused by fire, theft, or vandalism
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Accidents such as collisions while test driving or moving vehicles
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Natural disasters like hail or flooding
The costs for garage keepers insurance are influenced by how many vehicles you store at once, your location, the type of services you provide, and your claims history.
Key Cost Differences Between Auto Dealer and Garage Keepers Insurance
Although both policies protect businesses in the automotive industry, their cost structures differ. Here’s how:
1. Coverage Focus
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Auto dealer insurance cost is higher because it covers vehicle inventory, customer liability, employee risks, and even regulatory compliance through auto dealer insurance requirements.
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Garage keepers insurance focuses primarily on customer vehicles in your possession, making it less expensive for smaller repair shops.
2. Risk Exposure
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Dealers face test drive risks, large-scale inventory theft, and regulatory requirements.
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Garages face repair-related damages, customer vehicle accidents, and storage risks.
3. State Requirements
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Many states mandate auto dealer liability insurance and auto dealer bond insurance before issuing a dealer license.
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Garage owners are not typically required to carry garage keepers insurance by law, but it’s highly recommended.
4. Cost Ranges
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Auto dealer insurance companies may charge anywhere from $3,000 to $15,000 annually, depending on dealership size.
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Garage keepers policies are usually more affordable, averaging between $1,000 and $5,000 annually for small-to-mid-size shops.
Finding the Best Auto Insurance Deals
Both dealers and garage owners want affordable protection without sacrificing coverage. That’s where Garage Keepers Insurance steps in. We help businesses compare policies and find the best deal auto insurance options available.
Here are some tips:
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Compare multiple auto dealer insurance quotes from trusted providers.
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Look for auto insurance bundle deals, like State Farm auto insurance bundle deals, which can lower costs by combining policies.
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Ask about discounts and specialized programs for independent auto dealer insurance or smaller repair garages.
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Take advantage of cheap auto insurance deals without compromising essential coverage.
Our team works with top auto dealer insurance companies to ensure you get the best deal for auto insurance tailored to your unique needs.
Which Policy Do You Need?
The answer depends on your business:
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If you sell vehicles (new or used), you need dealer auto insurance. Whether it’s a large franchise or a small independent lot, this policy ensures compliance with auto dealer insurance requirements and protects your financial investment.
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If you repair, service, or store vehicles, you need garage keepers insurance. This ensures that every customer car in your care is protected, giving you peace of mind.
Some businesses actually need both. For example, a dealership that also has a repair shop may benefit from a combination of dealer auto insurance and garage keepers coverage.
The Role of Auto Dealer Insurance Companies
Choosing the right auto dealer insurance company is as important as the policy itself. Not all providers offer the same options or flexibility. At Garage Keepers Insurance, we partner with top-rated carriers, making it easy to secure coverage that balances affordability with complete protection.
We know that every business is unique. That’s why our process always includes:
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Reviewing your auto dealer insurance requirements
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Comparing multiple deals on auto insurance
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Offering a tailored auto dealer insurance program
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Helping you secure the best auto insurance deal
Conclusion
While auto dealer insurance and garage keepers insurance may seem similar, the two serve very different purposes—and their costs reflect those differences. Dealers face higher premiums due to inventory protection, licensing requirements, and broader risks, while garages usually enjoy lower premiums because their focus is primarily on customer vehicle care.
At Garage Keepers Insurance, our mission is to help you find the best deal on auto insurance for your business—whether you need used car auto dealer insurance, Florida auto dealer insurance, or specialized garage protection. By working with top auto dealer insurance companies, we provide access to the auto insurance best deals without sacrificing coverage.