Used Car Dealer Insurance – Used car dealers don’t all operate in the same way, therefore each individual dealer must compete with their respective risks and exposures. Inventory of new and used vehicle dealers must be a major consideration in used car dealer insurance programs. One dealer may operate in the open while the other may be in the building. Dealers with open lots must compete with weather exposure.
Theft is a clear problem, but some regions have a higher risk of theft than others. A person must also take into account the number of employees when estimating insurance costs. Car dealers in large metropolitan cities are likely to quote offers that are far higher than those in small cities or suburbs.
Used Car Dealer Insurance
Weather is a major problem in many areas
Theft is probably the most common encounter with car dealers, but higher premiums are imposed on those in areas prone to storms and hail. Geography is a major underwriting consideration given the risk of weather damage due to snow in some regions of the country, wind, rain and hurricanes occurring in the southeast, and tornadoes are a major concern in some parts of the country.
If the dealer is in a flood zone, they will usually be contracted with an elevated or multiple parking structure at a higher place. A lot of damage can come from elements that are blown by the wind, such as gravel, which can damage car paint. There are programs available for new and used car dealers, with open lots, which provide extensive physical damage protection and are available in several areas.
Exposures and other considerations
Like most businesses, car dealers have other exposures that have nothing to do with the weather. With so many people coming to their land or property, they can experience all kinds of risks inherent in carrying out this type of operation. Therefore, in addition to protecting their vehicles, they may need to have several other policies designed to deal with the types of concerns that many businesses must also face. The following coverage that they must buy to protect their assets is:
Responsibility of public places
Errors and omissions
Business interruption, and
Worker compensation insurance
Many dealers also have to repair the cars they have or buy for resale. Therefore, in addition to selling cars, many also make automatic repairs (and generally most do). Because they face additional exposure, they may also require some other special insurance considerations.
Maria T. Barber is an Insurance Agent for the Byrnes Agency in Connecticut that specializes in Home and Car Insurance and Business Insurance.
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