Owning your own auto shop requires not just skills under the hood, but also a keen business sense. One thing you don't want to overlook is the need for garage liability insurance. This insurance protects you and your business from lawsuits. Most people never expect to be sued, but even the most reputable of mechanics can find themselves at the wrong end of a liability claim. Knowing a few key strategies to avoid claims, combined with the proper insurance, will ensure your business can survive if something does go wrong.
What is garage liability insurance?
Garage liability insurance protects your garage from going bankrupt from both bodily injury and property damage claims. This insurance will cover the financial repercussions for both repairing or replacing a damaged vehicle, as well as any medical claims if an injury occurs to a customer. It generally doesn't cover employees, as employee injury will fall under your worker's compensation insurance. If a customer decides to sue for further damages, it is the insurance company that will pay, not your business. Even a frivolous lawsuit where your garage isn't found liable can hurt your bottom line, so having insurance that handles legal proceedings is important.
How can you minimize customer injuries?
There are a few steps you can take to prevent injuries from occurring, which can also help lower the costs of your garage insurance premiums. These are the three most effective strategies:
#1: Don't allow customers into the garage area
Although you likely keep a clean and organized garage, it really isn't the place for customers. Power tools, vehicle fluids, and other hazards will abound. Of course, some customers are distrustful if they can't watch the work being done. Many garages provide a viewing window so customers can watch the work being completed from a safe distance, which sets the client's mind at ease.
#2: Provide a waiting area
You can further prevent customers from wandering into the garage by providing a dedicated waiting room. Provide comfortable chairs, a television, reading materials, and a courtesy beverage bar so your customers won't be tempted to wander around. Plus, having a comfortable waiting area can be a selling point for your garage.
#3: Install ample signage
A customer wandering into a dangerous area and injuring themselves may be considered your fault if it isn't clear that the area is off-limits. Install large, brightly colored and boldly printed signs to indicate all employee-only areas. Further, consider using an entry lock system between the garage and the waiting area. Employees can use a code or their name badge to quickly pass through, but customers won't be able to accidentally walk into the work bays.
For more help, contact an insurance agency in your area.