Garage Liability & Dealer’s Open Lot (DOL)

For the person who owns a car dealership or anyone who is operating an automotive repair shop, we recommend a garage liability and dealer’s open lot DOL insurance policy. At Copeland Group, we recognize the importance of having the proper level of liability and property insurance protection for your dealership. We represent carriers with whom we have direct appointments and we maintain relationships with other Garage Liability Insurance carriers so that we can often provide multiple sources to quote this important coverage.

Two types of operations eligible for garage liability:

1. Dealers –  a person or firm engaged in the commercial purchase and sale of automobiles.

2. Non-Dealers – Business operation engaged in repairing, servicing non-owned autos.

Garage liability coverage is the broad liability insuring agreement provides bodily injury and property damage liability coverage similar to that provided by the commercial general liability policy and the business auto policy. The policy agreement for garage operations other than covered autos promises to pay all sums an insured legally must pay for damages because of bodily injury or property damage when caused by an accident and resulting from garage operations other than the ownership maintenance or use of covered autos. The garage policy provides liability coverage for products that are produced or sold in a garage business. Within the policy is a completed operations coverage which would be applicable in the event that resulted from property damage to an auto as the direct result of any work the insured performed on that auto.

It is necessary that every employee and officer of your company must be listed on your garage policy, whether or not they drive a company vehicle. This list should include managers, sales persons, mechanics, lot boys, runners, detailers and office clerical personnel. At Copeland Group, we need to be aware of the job classification and full or part time status of each person. Employees with faulty driving records (ie, tickets, suspensions, etc) may cause your policy to be cancelled or not renewed. In some cases, the carrier may choose to charge you a higher premium or perhaps they may suggest that you exclude a specific driver from your coverage policy. If a particular driver is excluded, you must be diligent in not allowing him/her to drive any of your vehicles.

Please be aware that DUIs and DWIs are a red flag to insurance companies. In most cases, they will choose to refuse to cover a dealership that has even one owner or employee with a DUI or DWI conviction on their driving record. In any event, the price will be much higher when such convictions are discovered.

DOL Insurance

A Dealer’s Open Lot coverage policy provides physical damage coverage protection to a dealer’s covered vehicles and equipment. Garage Physical Damage or Dealers Open Lot (DOL) will provide coverage for loss or damage to your autos in inventory. Garage physical damage insurance provides collision, comprehensive and specified causes of loss coverage. Covered vehicles are considered private passenger vehicles such as autos, pickups, minivans, and SUV’s, and these vehicles may be classified as the following in the dealer inventory: used, new, demonstrators or service vehicles.

There are 2 options for insuring your inventory:

1. Monthly reporting: This requires the dealer to send a monthly report to the insurance carrier with the exact dollar value of the vehicle inventory. Only used to insured high inventory value, typically over $1,000,000 in value.

2. Non-reporting: the dealer must state the maximum value of the inventory when the policy starts. It is advisable to pick the value of the inventory at the highest peak to insure a coinsurance penalty is not added.

In DOL coverage there is a limit per unit, in transit and other locations:

• Limit per vehicle: Be sure you have the limit per vehicle high enough to cover your most expensive vehicle.

• In transit and other locations: Coverage is provided while the vehicles are off the normal business property

Dealer Open Lot (DOL) covers:

1) Comprehensive: Provides coverage to a covered vehicle or equipment attached from any cause of loss except collision with another object or overturn.

2) Specified Causes: Provides coverage to a covered vehicle or its equipment caused by fire, lightning, explosion, theft, windstorm, hail, earthquake, flood, mischief, vandalism, or the sinking, burning or derailments of any conveyance transporting the covered vehicles.

3) Fire and Theft: Grants coverage to a covered vehicle or its equipment caused by fire, lightning, explosion or theft.

4) Collision: loss or damage to a covered auto caused by collision with another object

5) False Pretense: Provides coverage to a covered vehicle caused by someone who causes the dealer to voluntarily part with a covered vehicle by trickery, scheming, or under false pretenses. This can also occur when the dealer acquires a vehicle from a seller who did not have clear and legal title. The key here is voluntarily. For example, if you allow an unaccompanied test drive, and the driver does not return back to the lot, this is considered a false pretense claim. In most cases, policies exclude false pretense and you have to buy back the coverage.

At Copeland Group, we know that you dealership and auto shops are a vital business to you and to our economy. We want to help you understand the best coverage for you business today – call today to discuss your insurance needs.