Owning a car dealership is a thrilling venture. You get to connect people with their dream vehicles and keep the wheels of commerce turning. But running a successful dealership also requires careful planning and risk management. That’s where comprehensive car dealership insurance comes in – it protects your investment and provides peace of mind so you can focus on what you do best: selling cars.
This guide will take you through the different types of coverage typically included in a car dealership insurance policy, along with some valuable optional coverages to consider.
Core Coverages
Every car dealership insurance policy is built on a strong foundation of core coverages. These essential elements provide protection against a wide range of common risks:
- General Liability: Imagine a customer slips and falls in your showroom, or a test drive takes an unexpected turn. General liability insurance covers your legal costs, including medical expenses and lawyer fees, if someone is injured or their property is damaged due to your business operations.
- Example: A customer trips over a loose floor mat and breaks their arm. General liability insurance would cover the medical bills and any legal fees associated with the incident.
- Garage Liability: This is an extension of general liability that specifically addresses risks associated with your service and repair areas. It covers incidents like damage to a customer’s car while it’s being serviced or a mechanic accidentally causing injury to a customer.
- Example: A mechanic overtightens the lug nuts on a customer’s car, and a wheel comes loose while driving. Garage liability insurance would cover the repairs to the customer’s car and any potential injuries resulting from the accident.
- Commercial Auto Liability: Test drives are a crucial part of the car buying experience. This coverage protects your dealership if a customer has an accident during a test drive or if a delivery driver has an accident while transporting a vehicle.
- Example: A customer takes a car for a test drive and crashes into a mailbox. Commercial auto liability insurance would cover the cost of repairing the mailbox and any damage to the car.
- Property Insurance: This coverage protects your dealership building, inventory, furniture, and equipment from damage caused by fire, theft, vandalism, and weather events.
- Example: A storm rolls through and damages your dealership roof, causing water damage to the showroom and some of the vehicles on display. Property insurance would cover the repairs to the roof and the damage to your inventory.
- Workers’ Compensation Insurance: This is required by law in most states and provides medical benefits and lost wages to employees who are injured on the job.
- Example:
- Errors and Omissions Insurance (E&O): This protects the dealership from lawsuits alleging that they made a mistake, such as accidentally selling a car with a hidden defect.
- Example:
- Commercial Umbrella
- Example
Optional Coverages
While the core coverages provide a solid foundation, you can customize your dealership insurance with optional coverages that address specific risks:
- Glass and Sign?
- Dealer’s Open Lot (DOL) Coverage: This vital coverage protects your valuable vehicle inventory from physical damage caused by theft, vandalism, fire, weather events, and collisions (both on your lot and during transport).
- Consider It If: You have a significant investment in your car inventory.
- Example: A hailstorm damages several cars on your lot. DOL coverage would cover the cost of repairing the hail damage.
- Errors & Omissions (E&O) Coverage: Also known as professional liability insurance, E&O coverage protects your dealership from financial losses if a customer sues you for negligence, such as misrepresenting a vehicle’s condition or failing to disclose mechanical issues.
- Consider It If: You are concerned about potential lawsuits related to vehicle information or repairs.
- Example: A customer sues your dealership because the car they purchased had a hidden mechanical issue that wasn’t disclosed on the sales paperwork. E&O coverage would cover your legal defense costs and any settlement reached with the customer.
- Cyber Liability Coverage: In today’s digital world, a data breach can be devastating for your dealership. Cyber liability coverage helps cover costs associated with a data breach, including notifying customers, credit monitoring, and legal fees.
- Consider It If: You store customer data electronically, such as names, addresses, and social security numbers.
- Example: Hackers gain access to your dealership’s computer system and steal customer data. Cyber liability coverage would cover the costs of notifying customers, providing credit monitoring services, and any legal fees associated with the data breach.
Streamlining Costs: Potential Discounts
Many car dealership insurance providers offer discounts that can help you save money on your premiums. Here are some common examples:
- Multi-Policy Discount: Bundling your dealership insurance with other commercial insurance policies, such as workers’ compensation, can lead to significant savings.
- Loss-Free History Discount: Maintaining a clean claims history can significantly reduce your premiums.
- Safety Measures Discount: Implementing security measures like alarm systems and video surveillance can demonstrate a proactive approach to preventing loss.
Why Ozark Legacy Insurance Partners is Your Ideal Partner
Now that you understand the different types of car dealership insurance coverages, it’s time to find the right partner to navigate your options and secure the best possible protection. Here’s why Ozark Legacy Insurance Partners should be your top choice:
Local Expertise, National Strength: As a local, independent insurance agency, we have a deep understanding of the unique risks faced by car dealerships in our region. We combine this local knowledge with the strength and resources of a national network of insurance carriers. This allows us to offer you a wide range of competitive quotes and personalized service.
Tailored Solutions: We don’t believe in a one-size-fits-all approach. Our experienced insurance agents will work closely with you to understand your specific needs and risk profile. We’ll then design a customized insurance plan that provides comprehensive coverage at a competitive price.
Risk Management Expertise: We go beyond simply selling insurance policies. Our team will also work with you to identify potential risks and implement strategies to mitigate them. This proactive approach can help you avoid claims and potentially lower your insurance premiums in the long run.
Dedicated Claims Support: In the unfortunate event that you need to file a claim, Ozark Legacy Insurance Partners will be by your side every step of the way. We’ll advocate on your behalf with the insurance company to ensure your claim is settled promptly and fairly.
Unwavering Commitment to Service: We understand that your time is valuable. That’s why we offer flexible appointment scheduling and are readily available to answer your questions – by phone, email, or in person.
Get a Free Quote Today!
Don’t leave your dealership’s future to chance. Contact Ozark Legacy Insurance Partners today for a free, no-obligation quote on a customized car dealership insurance plan. We’ll help you navigate the complexities of insurance coverage and ensure you have the peace of mind you deserve to focus on running your business.
Here are some additional resources that you may find helpful:
- National Automobile Dealers Association (NADA): https://www.nada.org/
- The Insurance Information Institute (III): https://www.iii.org/
By partnering with Ozark Legacy Insurance Partners, you can ensure your car dealership is well-protected against a wide range of risks, allowing you to focus on what matters most – selling cars and keeping your customers happy.