How to Evaluate Your Auto Repair Shop Insurance Before The New Year

By Zuma Insurance Services | December 20, 2017

If you own an auto repair shop, maintaining the right insurance coverage is essential. Without the proper coverage, you could face a lawsuit or another type of financial loss that could harm your profitability and even force you to close your business. Some types of insurance may even be required by law, which means you could face additional penalties if you don’t purchase the coverage you need. As the new year approaches, it is the perfect time to evaluate your auto repair insurance coverage and make any needed changes to protect your company.

To review your auto repair insurance in California thoroughly, follow the steps below.

1. Consider each policy separately.

Most auto repair shops have multiple insurance policies. Review each of these policies separately to make sure that each one provides the appropriate amount of coverage. Depending on your business structure, you may have business auto insurance, garage liability insurance, general liability insurance, workers compensation insurance and more.

2. Look at the covered events, as well as the coverage limits.

Most insurance policies have exclusions. Read your policy carefully to make sure it covers all of the risks you are most likely to face. If you find that an important risk is excluded, ask about additional coverage to protect your business. You should also consider the limits of each policy. If the limits aren’t high enough, raise them before the new year begins.

3. Consider any changes your business has made since your last coverage review.

If your business has made any significant changes since your most recent review, consider whether these changes require you to modify your insurance coverage or purchase additional policies. Changes may include new buildings, new services, the addition of new employees and other such events.

4. Think about California law.

Legally, businesses in California are required to purchase certain types of insurance. For example, if you have employees, you are typically required to purchase workers compensation insurance to protect them. Make sure you are in compliance with all of the relevant laws in the state of California. If you are not in compliance with all of these laws, make the necessary changes before the new year.

5. Talk to your agent about your needs.

Reviewing your auto repair shop’s insurance policies on your own can be complicated. Because you may not understand all of the details of these policies or the applicable state laws, you may make a mistake if you try to conduct this review on your own. To make sure you have the coverage you need and that your review is thorough, contact your agent for guidance. Your agent will be able to make recommendations based on your unique situation and coverage goals.

6. Take a look at your premiums.

In some cases, your insurer may offer discounts that weren’t available to you last year, either because you didn’t qualify or the discount is new. Review your policy premiums carefully and ask your insurer if any new discounts are available to help bring them down.

Key Takeaways

• Auto repair shops need to maintain various types of insurance coverage to protect against liability and financial loss.
• To review your insurance coverage, consider each policy individually. If your business has changed, consider how these changes affect you.
• Consult your agent for assistance as you review your policies to make sure you have made the right choices.

If you own an auto repair shop and you are ready to conduct your annual insurance review, please contact Zuma today for more information.