The last thing most people think about, when dropping off their vehicle for service at the repair shop, is the chance that it might be damaged when you go to pick it up at the end of the day. However, the possibility exists each and every time you do.
Is the repair facility responsible for damage to your vehicle? More to the point, does their insurance provide coverage for that damage while your car is in the parking lot or inside the shop?
Like most insurance coverage questions, the answer is “it depends”.
First, keep in mind, the assumption is that the repair shop has insurance. Not always a given, by the way.
If insured, most shops will have coverage to protect the vehicle against their own negligence. Accidents while test driving, and accidental damage while working on it would normally be covered on the shop’s basic liability policy.
Okay, but what about coverage for other types of damage? Things like hailstorms, theft, or vandalism.
Repair shops, auto body shops, and car dealers with a service department usually have something called “Garagekeepers” insurance. It covers physical damage to customers’ vehicles. However, there are three types of Garagekeepers insurance. Which one your shop has will determine whether or not your car is covered. Let’s start from “good” to “best”.
Legal Liability (Good)
This type of Garagekeepers coverage will only pay for damage to your vehicle if the repair shop was negligent in its care and custody. Did they leave the care windows open? Was your car left unlocked overnight? Did they leave the keys in the ignition? These are examples where legal liability would cover the loss. However, things like hailstorms, and windstorms that blow debris onto your car aren’t covered. Neither is a collision caused by another customer hitting your car. Even theft wouldn’t be covered if the vehicle had been properly secured.
Now keep in mind, you may have coverage on your own auto insurance policy if you’ve purchased physical damage (comprehensive and collision coverage). But what if you didn’t? What if you have an older vehicle with just “liability only” coverage? Then, in this scenario, your car is unprotected.
Direct Excess (Better)
This type of Garagekeepers will cover everything that “Legal Liability” does plus losses in excess of the coverage you may have on your car. So, let’s say a windstorm knocks down a tree branch that falls onto the hood of your car, causing damage. Clearly the repair shop isn’t negligent. In this scenario, the only way the shop would cover it is if you DON’T have comprehensive coverage. If you do, it would not be covered by the shop…time to call your insurance company.
“Excess” coverage means customers with “liability only” coverage will be covered by the shop. However, if you have “full coverage” (comprehensive and collision), you will have to file a claim with your own company.
Direct Primary (Best)
This type of Garagekeepers coverage pays for damage without regard to the shop’s liability, or whether or not you have full coverage on your vehicle. In other words, in this case…relax…your car is covered. The shop’s insurance will take care of it.
This agency always recommends “Direct Primary” coverage to auto repair service centers. The difference in cost is small, and it goes a log way in creating customer goodwill. It seems reasonable for customers to believe their car is covered for damage while it’s at the shop. Don’t you?
Keep in mind, the repair shop will usually have to pay some kind of deductible when your vehicle is damaged. That’s an out of pocket cost they did not expect. If something like this happens to you and the shop takes care of things…spread the word and tell others. Reward them for caring and treating the customer like family.
So, what should you do when taking your car in for repair? Ask. It’s okay. Better to know before you drop your car off, rather than finding out too late.
Chances are nothing will happen to your vehicle. However, all things being equal; if choosing between two repair facilities, wouldn’t you rather go to the one that has Garagekeepers with “Direct Primary” coverage? Wouldn’t you feel better knowing you won’t have to file a claim with your insurance company if something happens? Or worse yet, face paying thousands of dollars out of pocket because you didn’t have physical damage on the car and the shop only had legal liability for Garagekeepers?
Being an informed consumer will help you avoid this kind of unexpected expense.