Garagekeepers Insurance for Customer Cars: Damage, Theft & Vandalism While in Your Care

Garagekeepers covers physical loss to a customer's car while it sits in your care, custody, or control. Fire, theft and vandalism are always covered. Hail, wind and flood are covered under only one of the three peril options, and a crash is outside all three unless Collision was bought separately.

Which option your shop bought is printed on the declarations page, one line for every location you run. The gap surfaces after a storm, when fifteen cars are dimpled and the policy leaves out hail.

What will garagekeepers actually cover on a customer's car?

Garagekeepers covers physical loss to a customer's car in your care, and which perils it reaches depends on the option scheduled for that location. The three options are separate selections rather than tiers that stack:

• Comprehensive: any cause except the car's collision with another object, or its overturn.
• Specified Causes Of Loss: fire, lightning or explosion; theft; mischief or vandalism.
• Collision: the car's collision with another object, or its overturn.

Repair shops, body shops, detailers, tow operators and parking garages all need it, whatever the sign out front says. Buying garagekeepers insurance settles which perils are in. Whether it pays when nobody can prove the shop was careless turns on the form basis (legal liability, direct primary or direct excess). Our direct primary versus legal liability post takes that apart.

When is a customer's car in my care, custody or control?

A customer's car falls into your care, custody, or control once you take possession of it for work or storage. The garage form calls it a customer's auto, reaching any vehicle lawfully in your possession for service, repair or storage. Taking possession makes the shop a bailee holding property that belongs to someone else. California's Civil Code section 1852 requires a depositary for hire to use ordinary care.

General liability won't answer, because the standard form excludes damage to personal property in the insured's care, custody or control. It is the same wall a rigger hits with a chiller on the hook. Garage liability pays third parties for bodily injury and property damage, and the car in your bay is not a third party. Some states name garage keepers directly, so state rules sit apart from what you bought.

Does hail on my lot count as a covered loss?

Hail damage to customer cars is covered only under the Comprehensive option. On the garagekeepers side, Specified Causes Of Loss runs three items: fire, lightning or explosion; theft; mischief or vandalism. Windstorm, hail, earthquake and flood are absent from it.

In the ISO garage coverage form, the physical damage section covering the shop's own trucks lists six causes under the same name. Buy the narrow option to save money and the tow truck keeps hail coverage while the customer cars beside it have none.

That's why articles on this question contradict each other: the answer sits in the declarations.

A customer's car was stolen off my lot overnight. Am I covered?

A customer's car stolen off the lot by a stranger is a covered garagekeepers loss. Theft is named outright in the Specified Causes Of Loss list, and sits inside the broad option too. Parts stripped off a car count as a partial loss.

One four-bay body shop lost four converters in a single night, off cars waiting on back-ordered parts. Each carried its own deductible (the amount absorbed before the policy pays).

In the FBI's motor vehicle theft report, parking, drop lot and garage ranked second among reported theft locations in 2019 and 2020. No authoritative figure exists for how often customer cars are stolen from repair shops.

Keyed panels, broken windows and slashed tires are covered too, under the form's term mischief or vandalism. That term is wider than vandalism alone, and it does not require identifying who did it.

What if one of my own employees takes a customer's car?

Theft of a customer's car by one of your own people is excluded from garagekeepers. The ISO garagekeepers endorsement bars loss due to theft or conversion caused in any way by you, your employees or by your shareholders. Theft by a stranger stays covered, since the exclusion reaches only that group.

That phrase reaches past the technician who drives off in the car. An employee who leaves the key board open for a friend falls inside it, and so does one who props open the bay door.

Employee dishonesty lives in crime coverage, a separate form from the garage policy.

My tech wrecked a customer's car on a test drive.

A technician who crashes a customer's car on a test drive is a Collision garagekeepers claim. Comprehensive is defined to exclude exactly this: loss from any cause besides the car's collision with another object or its overturn.

That definition catches people off guard more than any other line in the form. A shop that bought the broad option, assuming broad meant everything, has nothing when a road test ends in a bent quarter panel. Ask for the Collision line by name at renewal, because nothing caps the shop's out-of-pocket there.

Does garagekeepers pay when we get the repair wrong?

Garagekeepers does not pay for damage from your own faulty work you performed, a phrase the form reads broadly. It takes in work someone did on your behalf, plus a failure to give warnings or instructions. Defective parts and materials are excluded separately.

For example, a transmission shop that reuses a cracked cooler line and cooks the rebuild owes the customer a transmission. That answer sits in garage liability or a faulty-work endorsement instead.

Personal items left in the car fall outside the grant, and so does sound-reproducing equipment that isn't permanently installed, along with radar detectors. Pollution sits outside the grant too, so a spill at the shop needs an answer from another form.

What does my limit cover when one storm hits ten cars?

Garagekeepers limits apply for each loss at each location, not for each vehicle. One hailstorm across ten customer cars is a single loss against a single limit, however many cars it dented. Twenty cars averaging $30,000 is $600,000 you would have to make good on after a fire. That is an illustrative figure, not a published statistic.

Oregon's clause for state garage work says the same, asking that limits be high enough to cover the value of the vehicles left for safekeeping. Deductibles split by peril, with one set for each customer's car for theft or mischief and vandalism. A stated maximum then caps the total for all such loss in any one event, and Collision carries no such cap.

Pull the declarations page and read the garagekeepers line for each location. Coverwatch quotes garage accounts on a flat fee, so telling a shop to raise a limit earns the broker nothing.