Your Guide to Body Shop Insurance

Get financial backup for property damage and lawsuits.

Body Shop Insurance

Body shops are often family-owned neighborhood businesses with longstanding customers. These shops typically offer collision repair services and other auto body work like dent and paint repairs, parts, and other structural, mechanical, and cosmetic auto body work.

If you own a body shop, you need business insurance to protect your assets from the risks associated with taking in and repairing other people’s vehicles. Any kind of injury, error, or property damage can result in a costly claim or lawsuit.

You also need financial backup if your own property is damaged, if your workers are injured, or if you experience crime, theft, or vandalism at your business.

A local independent insurance agent can help you find appropriate body shop insurance tailored to your needs.

Why Do You Need Body Shop Insurance?

Body shops typically repair collision damage, fix dents and dings, replace panels, and offer parts for sale for damaged cars, trucks, and vans.

If you own a body shop, your employees are likely highly trained professionals who use expensive, specialized equipment to repair vehicles to exacting standards. When customers come to you for auto body work, they entrust their vehicles to your care while they’re being repaired.

The expectation is that your customers’ cars come out in much better shape than when they went in. The last thing you want to happen is doing more harm than good to someone’s car.

Damaging someone’s car is just one of the risks you face as a body shop owner. In addition, body shops face the following types of business risk.

  • Slips and falls on your premises
  • Worker illness or injury
  • Faulty workmanship or parts
  • Property damage due to fire, bad weather, vandalism, or theft
  • Employee theft or crime
  • Business interruption

You need a variety of business insurance policies to protect your business from these risks. In addition, garage liability insurance and garage keepers insurance are designed to help you protect your customers’ property and your business in wake of accidents, injuries, or property damage.

What Body Shop Insurance Policies Do You Need?

A local independent insurance agent can help you insure your body shop. You’ll likely need some combination of the following types of body shop insurance policies.

  • Commercial property insurance: This protects you if a fire, vandalism, smoke, theft, or other event damages your property. It provides coverage for lost inventory, damaged parts and equipment, tools, computers, office contents, and more. 
  • Business interruption coverage: Most business property policies also include business interruption. This will pay for rent, employee salaries, and other expenses if your shop must close temporarily due to a covered incident. 
  • Commercial general liability (CGL) insurance: This provides protection for most basic liability issues that a garage or body shop could face. It protects you from the costs of lawsuits related to accidents, property damage, and a variety of other mishaps. You will likely want to consider garage liability insurance, which provides several forms of liability insurance more specifically designed for the needs of body shops and other auto repair businesses or garage operations.
  • Business owners policy: (BOP) This is a package policy designed for small businesses. It combines property, liability, and business interruption coverage in one affordable policy.
  • Employee theft and crime coverage: This can protect your business from the costs of theft, dishonesty, and fraudulent acts committed by a single employee or a group of employees.
  • Commercial auto insurance: This is particularly important for body shops. It covers any vehicles that your business owns. In addition, you need non-owned auto liability insurance if you have any employees who drive their personal vehicles for business purposes.

Your independent insurance agent may be able to find customized body shop insurance programs that combine relevant business insurance policies into one comprehensive package designed for businesses like yours.

What Is Garage Keepers Liability Insurance?

Garage keepers liability insurance is specialty business insurance coverage designed for body shops and just about any other type of establishment that provides parts or service for vehicles and temporarily stores those vehicles onsite.

Garage keepers liability insurance protects you if a customer’s vehicle is damaged due to your negligence while it is in your care, custody, or control. This protection is not included in the standard garage liability policy. There are a number of ways in which a customer’s vehicle can be damaged while in your possession, such as fire, theft, weather events, vandalism, employee test drives, and lift accidents—to name a few.

Garage keepers liability insurance does not cover the contents of a customer’s vehicle, and also does not cover damage that occurs as a result of faulty workmanship, parts, or insufficient warrantees.

Why Do You Need Workers’ Compensation Insurance?

Workers’ compensation insurance is essential coverage for your body shop. And depending on the number of employees you have, it is likely required by the state in which you do business.

Body shops are dangerous places, particularly for the employees who do the work. The potential for smashed hands and crushed limbs from machinery or falling vehicles is present every day. Employees are subjected to fumes and toxic chemicals, paints, and other corrosive materials that can cause skin, eye, and lung irritation.

If one of your employees gets injured while on the job, not only will he or she have medical bills to pay, but also your employee may not be able to work until fully recovered.

Workers’ compensation insurance protects your employees and your business from the costs associated with work-related injuries and illnesses. It provides coverage for medical care and lost income for an injured worker while he or she is unable to work. Workers’ compensation insurance also helps protect employers from lawsuits by injured employees.

How Much Does Body Shop Insurance Cost?

The cost of body shop insurance varies depending on the following.

  • The size of your business
  • The number of employees you have
  • How much commercial property you have (buildings, inventory, equipment, etc.)
  • The types of services that you provide

Business insurance costs are also higher or lower depending on the location of your business, whether or not you own any commercial vehicles, and how risky your physical space and line of work is to customers and employees.

An independent agent who has experience working body shops can help you decide the types and amounts of coverage you need for your business. The choices you make will determine your cost of coverage.

Find and Compare Quotes

An independent agent can work with you one-on-one to determine the types and amounts of coverage you need. Your agent can get quotes from multiple insurance companies so you can evaluate the cost and coverage options and make the best choice.

Benefits of an Independent Agent

Our agents simplify the search process for finding the right body shop insurance. They’ll walk you through the handpicked policy options and explain the details.

Most importantly, they’ll be there for you when claim time comes. They know the ins and outs of the process and will make sure your claim is handled appropriately.

The Lowdown on Online Quotes

Online quotes can be tempting. They are fast and easy to get—but are they accurate? And are you getting quotes for the right coverage? For business owners, choosing speed over accuracy can cost you. 

Online quotes can’t and don’t see the whole picture. They can omit important coverage that will leave you devastated if something unexpected happens. And they can leave out cost-saving opportunities that an agent can help you take advantage of.

Instead of getting an online quote, find an independent insurance agent now, and get one-on-one consultation and affordable options for the best coverage for your unique needs.

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TrustedChoice.com Article | Reviewed by Paul Martin

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