Intro:
If you’re a mechanic, then you may be wondering—do you actually need insurance to do business?
This is a great question.
And whether you own your own repair shop, or just work as a gig worker on the weekends fixing cars as a side hustle—the fact remains that you do have some things to think about when it comes to insurance.
So in this post, you’re going to learn everything you need to know to answer this question:
Why do auto repair shops need business insurance?
Let’s dive into it and discuss it.
As A mechanic, You’re Handling Expensive Vehicles On A Daily Basis
Let’s start with the basics.
What are you actually doing for work on a daily basis?
Well, you’re repairing vehicles.
And what are vehicles?
They are expensive properties owned by your clients.
Now, as you move, repair, and perform maintenance on these vehicles, there’s always the possibility of damage, right?
No job ever goes perfectly as planned.
So what if something happens, and you end up damaging this expensive piece of property?
Do you think that the car owner will just shrug it off and say:
“Oh, it happens. I forgive you. I’ll just pay to get it fixed or buy a new one.”
Unfortunately, the world isn’t this kind.
More than likely, as a mechanic (and even more importantly, as the shop owner) you’re going to be held liable for any repairs that need to get done.
And therein lies the problem.
You’re going to be held liable for the costs of the repairs.
And sometimes, this can range into the thousands (or even hundreds of thousands) of dollars!
This Is Where Mechanics Insurance Comes In
Mechanic insurance helps to cover you in case something happens with the vehicle you’re working on.
Insurance for this type of business generally requires some general liability insurance, as well as garage keeper’s insurance, some errors and omissions coverage, commercial property insurance, workers’ comp coverage, health insurance, and disability and life insurance.
Each one of these different types of insurance has its place—but they all work together to help protect mechanics from financial liability and danger.
Also, you can prefer keyman insurance that should ideally cover £500,000 (or more) in the event of death or illness.
Now, some of these types of insurance are specifically designed to protect mechanics from liability. These include:
- General liability insurance
- Garage keeper’s insurance
- Errors and omissions coverage
- Commercial property insurance
But there are also other types of insurance that either help to protect you as a mechanic/business owner, or to help you protect your staff from life events that may derail their ability to work.
These include:
- Workers’ comp coverage
- Health insurance
- Disability and life insurance
Why Do Mechanic Repair Shops Need Business Insurance?
The answer to this question is pretty simple.
Without some kind of business insurance, mechanic shops and freelance mechanics are definitely at risk for financial liability in the event that something goes wrong with the vehicle, and/or there is some kind of injury or damage sustained while the work is being performed and the vehicle is in the mechanic’s care.
For this reason, it’s absolutely essential to make sure to have insurance—so that you can protect yourself and your business from the dangers of financial ruin due to something going wrong with someone’s car, vehicle, or property while you’re storing and/or working on it.
Business Is Full Of Risk
But in order to succeed in business, you need to take risks… right?
If you never allow customers to drop their cars off at your business, you’ll never get any repair work.
If you never drive those cars to move them around the lot, you’ll never be able to do the work necessary to make your business function.
And so, the key isn’t to always avoid all of the risks. The key is to protect yourself with insurance as you take the necessary risks required to conduct the standard affairs of your business.
This is just super important.
Conclusion
There you have it.
A full, comprehensive answer to the question of why auto repair shops need business insurance.
Of course, at the end of the day, it’s super important that every mechanic learns to protect themselves and their business from financial ruin.
And insurance is one of the primary tools for how to accomplish this.
You’ve got this.
Now it’s time to get the insurance you need to make it happen.
