Have you ever heard the one about the mechanic who forgot to tighten the lug nuts on a customer’s car, causing the wheel to fall off on the highway? This is where auto repair shop insurance comes into play. 

As an auto garage mechanic, you know that mistakes like this can happen, even to the most experienced and careful professionals. 

That’s why having the right insurance coverage for your garage is crucial. Auto repair shop insurance protects against unforeseen events that can damage your reputation, business, and bottom line. 

In this blog, we’ll guide you through everything you need to know about auto shop insurance so you can keep your business running smoothly and avoid any unpleasant surprises down the road.

What is Auto Repair Shop Insurance?

Auto repair shop insurance typically covers a range of risks that auto repair shops may face, such as damage to customer vehicles while in the shop’s care, theft of tools or equipment, liability claims arising from accidents or injuries on the premises, and more.   

Have you ever had a customer’s car damaged while in your shop’s care? Or had an employee accidentally injured someone while working on a vehicle? This is where ​​auto mechanic insurance plays its role. 

Accidents can happen in the blink of an eye, and without proper insurance coverage for auto repair shops, these incidents could lead to costly lawsuits or damage your business’s reputation. 

In a nutshell, having auto repair insurance is not only a wise business decision but also a legal requirement in many states. Protecting your business with the right insurance coverage can help ensure that your customers and employees are protected in unexpected events. 

Tip: If you want to start an auto repair shop, read this blog. 

Which Businesses Can Use Auto Shop Insurance?

Any business that works with automobiles in any capacity can benefit from auto shop insurance. It provides protection against a wide range of risks and liabilities, including property damage, theft, liability claims, and more.

Here are some examples of businesses that may need auto repair insurance:

  • Auto repair shops
  • Body shops
  • Car dealerships
  • Towing companies
  • Car rental companies
  • Car washes
  • Wheels and tires shop

What Are Common Risks of Insurance in Auto Repair Shops?

Auto repair shops face various risks when it comes to insurance. Here are some common risks of insurance for auto repair shops:

Property damage

Auto parts insurance is essential for auto repair shops because many expensive equipment and tools can be damaged due to fires, natural disasters, or other accidents. This can lead to significant financial losses, which can be covered by property insurance.

Liability claim

If a customer’s vehicle is damaged or someone is injured while on the premises of the auto repair shop, the business may be held liable. Liability insurance can protect the business from financial losses due to these claims.

Employee injuries

Auto repair shops can be dangerous places to work, with risks like slips and falls, cuts and burns, and exposure to hazardous chemicals. Workers’ compensation insurance can cover medical expenses and lost wages for employees who are injured on the job.


As you know, auto repair shops store sensitive customer information, such as credit card numbers and personal data, which can make them vulnerable to cyberattacks. Cyber liability insurance can provide protection against the financial losses resulting from these types of attacks.

Business interruption

If an auto repair shop cannot operate due to a covered event such as a fire or natural disaster, business interruption insurance can cover lost income and operating expenses during the downtime.

Auto repair shops must work with their car repair insurance companies to identify potential risks and ensure they have appropriate coverage to protect against financial losses.

Types of Insurance Coverage for Auto Repair Shops

As we have discussed above, auto repair shops are vulnerable to many potential risks and financial losses, so having the right car service insurance company working by your side is crucial.

If you’re still unsure which car maintenance insurance company is suitable for your auto repair shop, don’t worry – I can help by outlining the types of auto insurance coverage essential for protecting your garage.

General Liability Insurance

This type of auto repair insurance covers bodily injury, property damage, and advertising injury claims resulting from your business operations. It can also cover legal fees and settlements from lawsuits against your auto repair shop.

Property Insurance

Having property insurance for your auto repair garage is essential because this insurance policy covers the physical property of your auto repair shop, such as your building, tools, equipment, and inventory. It can also provide coverage for damage caused by events such as fire, theft, or natural disasters.

Workers’ Compensation Insurance

Have any workers ever been injured while working in your auto repair shop? This is where worker’s compensation insurance comes in. It provides coverage for medical expenses and lost wages to employees injured or ill while working at your auto repair shop. This mechanic insurance protects your business from lawsuits related to workplace injuries.

Commercial Auto Insurance

If your auto repair shop has a fleet of vehicles, this insurance policy is essential. It covers property damage and bodily injury claims arising from accidents involving your company’s vehicles.

The key takeaway: By considering the types of insurance coverage mentioned above, auto repair shop owners can decide what policies to purchase to keep their business safe.

Ways to Choose the Best Auto Repair Shop Insurance 

Choosing the right automotive repair insurance company can be challenging, but there are several factors to consider when selecting the​​ car maintenance insurance company for your business. 

You should know more about your rights to run an auto repair shop. This will make choosing the best car repair insurance companies for your garage easier. 

Here are some steps you can follow to help you make an informed decision:

  • Research different insurance providers
  • Consider the coverage options
  • Check the financial stability of the insurance provider
  • Look for reviews and feedback from previous customers
  • Compare quotes from different insurance providers
  • Consider the level of customer service provided by the insurance provider
  • Make sure the insurance provider has experience with auto repair shop insurance
  • Check for any exclusions or limitations in the insurance policy
  • Ensure the insurance policy meets any legal or regulatory requirements
  • Consult with an insurance agent or professional for guidance

What is the best way to negotiate lower auto insurance rates?

Are you tired of paying high insurance premiums and looking for ways to save money on your auto repair shop insurance coverage? If so, several strategies exist to lower your auto body shop insurance coverage premiums and keep more money in your pocket. 

Here are some ways to lower car insurance premiums:

Show your safety measures: Insurers typically offer lower rates to businesses that demonstrate they have taken steps to reduce risks. Show your insurance provider that you have implemented safety measures in your garage, such as fire suppression systems, security cameras, and training for your staff on safety protocols.

Consider raising deductibles: You can lower your premiums by agreeing to a higher deductible. Make sure to weigh the potential savings against the deductible cost if an accident occurs.

Compare rates: Shop around and compare rates from different insurers. Be sure to look at each provider’s coverage, exclusions, and deductibles. You may find a better deal by switching to a different insurance company.

Bundle policies: Consider bundling your auto repair garage insurance policy with other types of insurance, such as property or liability insurance. Many insurance providers offer discounts for customers who have multiple policies.

Maintain a good claims history: A history of few or no claims can help you negotiate lower rates with your insurance provider. Keep your records organized and up-to-date, and promptly report any accidents or incidents that may lead to a claim.


How do you calculate auto repair insurance costs for your business?

Let’s dive into the world of auto repair insurance costs. Believe it or not, mechanic insurance costs can be a make-or-break factor for many auto repair businesses. But fear not. We’re here to help you understand the ins and outs of insurance costs. 

Auto repair shops typically pay an average of $75 per month or $900 per year for a $1 million limit insurance policy, specifically for general liability coverage, also called garage liability insurance.

Regarding auto repair shop insurance coverage, there’s no one-size-fits-all solution. As an auto repair shop owner, you must tailor your insurance coverage to your unique business needs. 

This means considering factors such as the size of your shop, the types of vehicles you work on, and the number of employees you have.

It’s also important to keep in mind that your claims history can have a significant impact on your auto shop insurance cost. So, it’s essential to maintain a safe working environment and avoid any potential risks.

Tip: You can apply for auto repair shop insurance here


In conclusion, automotive shop insurance is a crucial investment for any business working with automobiles. From the possibility of property damage to cyberattacks, auto repair shops face many risks that could lead to financial losses or even threaten the business’s survival.

By understanding the different types of insurance for auto repair shops, business owners can decide on what policies to keep their garage protected. Additionally, choosing the right insurance provider and policy can make all the difference when it comes to filing a claim and ensuring a smooth recovery process.

So, whether you’re running an auto repair shop, body shop, car dealership, or any other automobile-related business, taking the necessary steps to protect your investment is essential. 

With the right auto repair shop insurance coverage, you can rest assured that your business is protected against the unexpected and can thrive for years.