Shop Insurance

Hey guys,

I'm trying to get a shop started here and was checking into liability insurance for my shop and was quoted prices from $22,000 to $35,000 per year, is this normal ?
Or do any of you know if it would be safe getting the customer to sign a waiver just in case something would happen to go wrong with the car and the customer was to get hurt ?
I'm very particular with my cars in quality and safety, but you never know when something could go wrong. Any info would be helpfull. :)

Rocky

It's been almost 5 years since I had my shop, Garage Keepers liability at a fairly high coverage amount (we would have 25 + cars on site at any time) ran around $8k/yr through Ohio Casualty. I forget exactly the deductible, but I'm thinking it was around $1k. This was for a "typical" garage policy. I was visiting the guy who painted my Dodge the other day and somehow shop insurance premiums came up. He says he pays a little more than double what a "normal" body shop would because he's classified as a restoration/hot rod shop. Said there were only two providers for here in Nevada. Perhaps that's the situation you're in, ask your agent. As for the waiver deal, I'm no attorney, and I don't know of any that hang here, and that's the only place to go to get a realistic answer. My guess would be you would be leaving yourself wide open for a law suit, regardless of a signed waiver from the customer. Courts aren't very sympathetic to a "knowledgable" business person "taking advantage" and being "negligent" to a poor, inexperienced, unsophisticated, blah, blah, consumer.

Rocky, I would take that question to iATN

This and other topics for shop owners have been discussed there at length. In fact, if you are a shop owner and/or professional technician, you will find the site an indespensible source of info on everything from A-Z, including technical questions. If you're not a member there already, I think you will want to join!

Though Bob has offered some excellent advice! ;)

No matter what the customer signs, neglegence can't be waived.

Opening a small automotive business is a subject that has been discussed here before, but this is the first time I recall the specifics some of the administrative costs associated with running a shop being discussed.

Operating a business open to the public without liability insurance is shooting craps with your future. . When I was operating my small shop it was not at all unusual to have $100K+ worth of customers cars on the premises. Something like a fire would have put in debt for the rest of my life (or more likely bankruptcy) without insurance. The insurance prices quoted and very limited choices in carriers are about right.

You also start looking at how you do certain things anytime there is a potential liability issue. For instance, I refused to rebuild master cylinders, wheel cylinders or calipers on customers cars, even years latter there was always the potential for a law suit if the brakes failed (got to love all the lawyers who advertise on TV). I always felt it was better to have the manufacture/rebuilder fight the suit than me!!!! Should you ever be sued, keep on mind the only people who win are the lawyers, even if you win the case fees are going to be expensive without insurance.

Laws vary state to state but as has been pointed out most blanket waivers (often times pre-printed on invoices) are really worthless in most courts. One exception (in most cases) is a hand written waiver on the invoice explaining a specific unsafe condition you observe that the customer refuses to have repaired, and signed by the customer.

First off let me say that I know absolutely nothing about this topic and have never run a shop, but here goes anyway. Seems to me that you should be able to put up a surety bond of some kind and insure yourself that way. At close to $3k a month for liability insurance premiums seems you could afford to a $3k deductible with the bond to cover major loss or liability. Then you could buy a simple theft and fire insurance for the business. What say you? Am I full of it or just naive?

Finally got back on the site, there must be something wrong with there server.
Anyway, my insurance agent did have a hell of a time even finding a company to give a quote, most companies don't even want to mess with a shop like this.
The price for $35,000 per year only included $300,000 liability, covered what I thought it would be in materials for 3 cars and roughly $15,000 in equipment. This was the price if I only used all new parts like motor , tranny, you guys know the rest.
But here's what I can't figure out, if I were to build choppers here (kit bikes) which are more dangerous the liabilty insurance which actually had more coverage would only be $6700 per year, try and figure that one out.
As far as a waiver I 'm thinking that probably is a bad idea.

Try Zuric Insurance Company they specialize in business insurance. I had our mobile fiberglass biz insured by them.