What are some used car dealer liability insurance requirements, and why is it essential in the dealership? While a standard commercial property insurance or a general liability policy can cover some aspects of the business, it may only provide some of the protection it needs. It is especially true for car dealerships.
Understanding the different types of used car dealer insurance coverage can help safeguard your clients’ business when the unexpected happens. But what is used auto dealership insurance? Also, what are the used car dealer liability insurance requirements need to sufficiently protect against the risks that may arise during business operations?
What is Auto Dealership Insurance?
Auto dealer insurance aims to protect car dealers from various risks in their day-to-day operations. Likewise, it typically includes coverage for a range of potential losses. These losses could include damage to inventory, liability claims, and employee theft.
Compared to personal vehicle insurance, auto dealer insurance is much more comprehensive and tailored to the specific needs of a dealership.
Which Businesses Must Maintain Car Dealership Insurance?
Car dealership insurance is essential for any business that sells or leases vehicles, including:
- Trailer dealerships,
- Vehicle detailing shops,
- Farm equipment dealerships,
- Motorcycle dealerships and more.
What Are The Auto Insurance Requirements for Dealership Businesses?
The required insurance coverage for dealership businesses can vary from state to state. Also, it may depend on the type and size of the dealership. The state laws and regulations governing the sale and leasing of vehicles also play a role. However, some of the most common insurance coverage types that may be required include:
Business Income Insurance: Provides compensation for lost income if a dealership must close temporarily due to a covered event, such as a natural disaster or fire.
Dealers Plate Insurance: Provides coverage for vehicles owned by a car dealership, allowing employees to legally drive and transport vehicles without purchasing separate insurance for each vehicle.
Commercial General Liability Insurance: Protects a business against liability claims for bodily injury, property damage, or personal injury arising from business operations.
Garage Keepers Liability Insurance: Covers damages or theft to a customer’s vehicle while in the business’s care, custody, or control.
E&O (Errors and Omissions) insurance: Protects businesses in the event of negligence, errors, or mistakes in their professional services or advice.
Other coverage types include Employment Practices Liability Insurance, Garage Liability Insurance, and Workers’ Compensation.
About K2 Insurance Services
K2 Insurance Services strives to create a leading underwriting and distribution franchise in the program insurance market. We’ve bridged the gap between agents and client payments with our efficient ACH payment system. Partnering with us gives agents the advantage of ACH payment capability that allows for direct billing through the firm. Call us today at (866) 429-1638 to find out how you could partner with K2 so you could offer top-tier insurance coverages and modern features to your clients.
