Garage insurance is a much misunderstood form.  Very few insurance agents understand exactly when to use it and more importantly exactly how.  You can use a garage liability policy to protect a used car dealer , often referred to as dealer’s insurance, or you can use this same form to protect an automotive repair shop or to set up body shop insurance .  The trick is to know the symbols.  At Clinard Insurance Group in Winston Salem, NC, we specialize in garage insurance and we understand the difference in how to set up used car dealers insurance and auto repair shop garage insurance. 

As I mentioned earlier, both types of businesses, auto repair and or body shops and used car dealers both need the garage policy.  But what is covered in these policies is driven by the symbols on the policy.  This is very important.  If you your business is automotive repair or body work but your policy is set up with symbols that would apply to a car dealership, you could find yourself without coverage in the event of a liability loss.

So how do you know if you have the correct symbols and thus the correct form?  Pull out your garage policy and look at the first page.   Beside each type of coverage, usually to the left, there will be a least one two digit number between 21 and 31.  These symbols will describe what is protected by the coverage described beside the number.  Here is a list of the most common symbols and what each one protects:

21                Any auto

22                All owned autos

23                Owned private passenger autos only

24                Owned autos other than private passenger

25                Owned autos subject to no fault laws

26                Owned autos subject to Uninsured Motorists law

27                Specifically described autos

28                Hired autos only

29                Non-Owned autos used in the Garage Business

30                Autos Left for Service/Repair/Storage

31                Autos on Consignment

As you have probably figured out, if you are an automobile dealer and you have code 30 on your policy, you would find yourself without coverage.  So why not just put code 21 on all coverages?  Well, since code 21 is the broadest coverage, you would have to pay more for this insurance policy and in some cases you might be purchasing insurance protection that you didn’t really need.

Take some time to look at your policy carefully and review the symbols for each line of coverage to make sure that they are appropriate for the work you do.  If you need help with this process, please feel free to call Clinard Insurance Group, toll free, at 877-687-7557 or visit us on the web at http://www.clinardinsurance.com.

At Clinard Insurance Group in Winston Salem, NC , we handle NC car insurance for thousands of clients and in that time we have had clients come to us with policies written by other agents that just don’t make sense.  Yes, it is possible and in fact common for people to be both under insured and over insured with their auto insurance policy .

Let’s start with the over insured problem.  With the down economy, more and more people are keeping their cars longer and that means that they are driving cars that have less and less value.  Yet few people call their insurance agent to update their policy to account for this.  Since the collision coverage is going to cover the depreciated value of the vehicle in an accident, over time they are paying more to insure less.  This results in over insurance and is quite often a waste of your valuable insurance dollars.

Now let’s take a look at the under insurance problem.  This one is extremely common and much easier to understand.  In North Carolina, car insurance is required by the state in order to obtain and keep your license tag.  For this reason, many people buy the insurance just to be able to license the vehicle without thinking carefully through what they are buying.  You should ask yourself, how much will it cost if I cause a severe, multi-vehicle accident?  Then check your policy to see if you have enough liability coverage to pay for it all.  Another way to view this might be to just ask yourself, “If I cause an accident that runs up a $450,000 (you pick the number) bill, how much of that do I want to pay for myself?” 

Now to take my point to the next level, consider the dollar for dollar cost of liability insurance verses collision insurance.  An average auto insurance policy in NC would cost $125 for $100,000 per person of liability insurance.  That means each $100 of insurance protection would cost you about 12 cents.  But collision insurance is much more expensive. If you are driving a car that is worth $10,000 and you are paying $140 a year for collision insurance with a $500 deductible, then your cost of insurance is $1.68 for  each $100 of insurance.  Which of these types of protection is more expensive?  Collision of course and by a wide margin.  Which one of these coverages is more important?  I would argue that the liability insurance is more important.  Here you are protecting yourself from a large, unknown amount of loss.  If you get this one wrong you could lose your home, your retirement, your savings and your kids’ college fund.  If you miss on the collision coverage, yeah you could lose your car but it ends there.

If you are unsure about your car insurance and would like some help understanding how best to spend your insurance dollars, please give us a call.  At Clinard Insurance Group in Winston Salem, NC, we specialize in helping people all over NC with their NC auto insurance policies.  You can reach us, toll free, by calling 877-687-7557 or visit us on the web at www.ClinardInsurance.com.