Every car detailer business needs insurance. Knowing which type of insurance you need and the best place to get it is the next step.
This article will cover the main types of business insurance and help you find the best car detailer business insurance.
Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.
Best Insurance for a Car Detailer Business
The most common and comprehensive type of car detailer business insurance is general liability insurance. We recommend general liability insurance as your first line of defense against a variety of the most general and commonly occurring claims.
Some of the risks general liability insurance covers are:
- Bodily injury
- Property damage
- Medical payments
- Legal defense and judgment
- Personal and advertising injury
While a car detailer business isn’t legally required to carry general liability insurance, operating without it is extremely risky. If your car detailer business is sued, you could face fees totaling hundreds of thousands of dollars (or more).
Cost of General Liability Insurance
The average car detailer business in America spends between $450-$1,000 per year for $1 million in general liability coverage.
Compare the average cost of general liability insurance for a car detailer business to other professional industries using the graph below:
Several factors will determine the price of your policy. These include your:
- Number of employees
- Per-occurrence limit
- General aggregate limit
You may be able to acquire general liability insurance at a discounted rate by purchasing it as part of a business owner’s policy (BOP) rather than as a standalone policy. A BOP is a more comprehensive solution that includes multiple forms of coverage, such as business interruption and property insurance.
Common Situations That General Liability Insurance May Cover for a Car Detailer Business
Example 1: In your specialized business, your workers rely heavily on large equipment to assist in the detailing process. If a customer wanders into the garage to check on their car as it sits on the lift, they could be burned, scraped, or slip and fall on tools on the floor. In this line of work, it's nearly impossible to prevent every possible accident from ever taking place. Luckily, general liability coverage can step in to help cover damages if you're sued by an injured customer.
Example 2: If you're working in a busy garage and one car rolls back into another, it could cause thousands of dollars in damages to both vehicles. While minor scrapes and dings can easily be paid for out-of-pocket, you don't want to be stuck paying for serious damages. Large-scale property damage to a third party's property should be covered by your comprehensive general liability policy.
Example 3: While it’s important to employ a team that takes workplace safety seriously, in the car detailing business, a wide variety of cleaning solutions and oils are used to make each car look it’s best. If a car detailing product is spilled or not cleaned properly, there is a risk for employees to slip and fall. With general liability insurance, you can rest easy knowing that most accidents, damages, and bodily injury situations are covered in case of a lawsuit.
Check out our review of the Best Small Business Insurance Companies.
Other Types of Coverage Car Detailer Businesses Need
While general liability is the most important type of insurance to have, there are several other forms of coverage you should be aware of. Below are some other types of insurance car detailers should obtain:
Garage Keepers Liability
Depending on the services you offer, it may be necessary to store customer vehicles on-site for several hours or even overnight. If a customer’s car is vandalized or stolen while on your property and you don’t have proper insurance, you could be held responsible for damages and left to repair or replace the vehicle by paying out-of-pocket.
Workers’ Compensation Coverage
Most business types must carry workers’ compensation insurance if they have any part-time or full-time employees. If an employee becomes sick or injured on the job, this type of insurance coverage works to cover their lost wages and related medical bills. Working with vehicles is a serious and potentially dangerous business, which is why it’s so important to make sure that your team is adequately covered in the event of an accident.
In addition to the policies outlined above, there are a few other types of coverage your car detailer business may require depending on certain aspects of your operations. Some of these might not apply to you, so be sure to ask your agent which policies are right for your business.
Commercial Auto Insurance
If your car detailer shop offers loaner vehicles to your customers or you use your own service vehicles, you are most likely required to invest in commercial auto coverage. Any vehicles that are used solely for business purposes should be covered under a commercial auto insurance policy to help protect your employees, customers, and your bottom line in the event of an accident.
Commercial Umbrella Liability
Whenever a business involves working on and around vehicles, there are a number of different risks to protect against. In fact, it is common for the expenses associated with accidents in these high-risk workplaces to exceed the limits of a primary insurance policy. With the help of commercial umbrella liability insurance, you can supplement your primary coverage for additional protection.
Additional Steps To Protect Your Business
Although it’s easy (and essential) to invest in business insurance, it shouldn’t be your only defense.
Here are several things you can do to better protect your car detailer business:
- Use legally robust contracts and other business documents. (We offer free templates for some of the most common legal forms.)
- Set up an LLC or corporation to protect your personal assets. (Visit our step-by-step guides to learn how to form an LLC or corporation in your state.)
- Stay up to date with business licensing.
- Maintain your corporate veil.
Business Insurance Is the Best Way to Protect Your Business
If you're starting a new business, then you need business insurance. It's as simple as that. The protection offered by an LLC will protect your personal assets, but your business's assets are still open to liability in the case of a lawsuit or other loss.
Be sure that everything you've built is safe by getting business insurance.
Car Detailer Business Insurance FAQ
Can I buy business insurance online for my car detailer business?
Yes, absolutely. You will need to first get a quote from an online business insurance provider like Next Insurance. Next allows you to then purchase a policy immediately and your coverage will be active within 48 hours.
What is included in a business owner’s policy?
A typical business owner’s policy includes general liability, business interruption, and commercial property insurance. However, BOPs are often customizable, so your agent may recommend adding professional liability, commercial auto, or other types of coverage to your package depending on your company’s needs.
What is the difference between business insurance and general liability insurance?
"Business insurance" is a generic term used to describe many different types of coverage a business may need. General liability insurance, on the other hand, is a specific type of coverage that business owners need to protect their assets.
Do I need insurance before I start a car detailer business?
You should invest in business insurance coverage for your business before your first interaction with a customer. Although the cost of insurance may seem high for a brand new business, it’s best to be proactive when it comes to protecting your assets. After all, you can’t buy insurance to cover a loss that has already occurred.
Will insurance protect my car detailer business from everything?
Not necessarily. Certain exceptions may be written directly into your car detailer business insurance policy, and some perils may be entirely uninsurable.
Is general liability the same as business owners?
A general liability insurance policy covers only liability losses. A business owner's policy covers both liability and property losses.
How do I choose the best general liability insurance?
The best general liability coverage for your business really depends on the amount of coverage you’re comfortable with and how often you expect to file a claim. A relatively safe business with a very low risk of accident or legal liability could opt for lower premiums with higher deductibles.
However, if you are in an accident or injury-prone industry or are making advertising claims about the effectiveness of your service or product, you may wish to consider more extensive coverage. We recommend using a digital insurance provider like Next Insurance.
Do I need business insurance if I already have an LLC?
An LLC doesn’t protect your business assets from lawsuits and liability– that’s where business insurance comes in. Business insurance helps protect your business from liability and risk.