Last Updated: February 22, 2024, 11:19 am by TRUiC Team

Motorcycle Shop Business Insurance

Getting insurance for your motorcycle shop is crucial in order to protect your business against a plethora of foreseeable risks.

These include theft and property damage, product liability claims, and employment law-related disputes. 

For example, if a motorcycle that was purchased from your store malfunctions while a customer is driving it, your business could become the subject of a compensation lawsuit. 

We’ll help you find the most personalized and affordable coverage for your unique business.

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Recommended: Next Insurance is dedicated to matching small businesses with the right policy at the best price.

Best Insurance for a Motorcycle Shop

General liability insurance is — generally speaking — one of the most important insurance policies for motorcycle shops. 

Some of the risks general liability insurance covers are:

  • Bodily injury
  • Property damage
  • Medical payments
  • Legal defense and judgment
  • Personal and advertising injury

Even so, it is important to note that your motorcycle shop will likely benefit from purchasing additional insurance policies in order to “fully” protect itself from all foreseeable risks.

As the owner of a motorcycle shop, we recommend considering the following types of coverage options in addition to a general liability policy:

  • Commercial property insurance — Covers the cost of replacing or repairing your shop’s motorcycles in the event of damage or theft.
  • Product liability insurance — Covers your business from liability that arises as a result of one of your motorcycles malfunctioning and causing a client harm ( such as bodily injury). 
  • Workers’ compensation insurance — Protects your business against liability that arises as a result of a dispute between an employee and your motorcycle shop. 
  • Business interruption insurance — Covers part of your lost income in the event that you are required to temporarily close down due to a fire or other covered risk. 

You will also need to find the right type of business insurance provider for your motorcycle shop. 

As of 2024, there are two different types of insurers to choose from as a small business owner: 

  1. Online insurance providers (recommended)
  2. Traditional brick-and-mortar insurance providers

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Cost of General Liability Insurance

On average, motorcycle shops in America spend between $500 - $1,500 per year for $1 million in general liability coverage.

Compare the average cost of general liability insurance for a motorcycle shop to other professional industries using the graph below.

Several factors will determine the price of your policy. These include your:

  • Location
  • Deductible
  • 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.

Graph showing average price of general liability insurance prices per industry

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Find the Best Rate

Discover the best coverage at the lowest rate in our affordable business insurance review.

Common Situations That General Liability Insurance May Cover for a Motorcycle Shop

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Example 1: During a test drive with a customer, one of your salespeople accidentally backs the motorcycle into the customer’s car causing extensive damages. General liability insurance would cover repairs to the customer’s vehicle and any legal costs if the event of a lawsuit.

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Example 2: As a customer discusses a repair job with a mechanic in your service bay, a replacement part falls off the hydraulic lift and hits his head and shoulder. Your general liability insurance would cover the customer’s medical bills and any other damages if he sues.

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Example 3: As you explore franchise options, you realize you must carry a minimum amount of general liability insurance to join your top choice. Investing in comprehensive general liability coverage will enable you to join your preferred franchise while also protecting your business from a wide range of risks.

Other Types of Coverage Motorcycle Shops 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 of the most common types of coverage:

Commercial Auto Insurance

If you use personal vehicles for work purposes alongside a designated fleet of service vans, your personal auto coverage won’t pay for damages to your car in the event of a work-related accident. Commercial auto insurance protects all vehicles you use for business-related activities in the event of a work-related accident.

Workers’ Compensation Insurance

Most states require businesses to carry workers’ compensation insurance for their part-time and full-time employees. This coverage protects your employees if they become injured at work or fall ill after a work-related accident. It not only covers an employee’s medical bills and lost wages if they need time to recover but also any disability benefits stemming from a work-related accident.

Commercial Umbrella Insurance

While your general liability insurance policy covers most claims, some accidents or lawsuits may be so catastrophic that they threaten to exhaust the limits of your primary coverage. Commercial umbrella insurance protects you from paying out-of-pocket for any legal fees and awarded damages that exceed your primary policy.

Commercial Property Insurance

If you own the building in which you operate, you’re responsible for all business-related property housed there in the event of a fire or other natural disaster. Commercial property insurance would cover the cost of repairing or replacing your specialized equipment, computers and parts inventory after an accident so you can recover quickly.

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 motorcycle shop:

  • 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.

Motorcycle Shop Business Insurance FAQ

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.

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.

"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.

Yes you do, even if it’s not a legal requirement. This is because you will want to purchase your business insurance policies before a lawsuit or other dispute arises; this can end up saving you tens of thousands of dollars.

For a motorcycle shop, we recommend getting general liability, business interruption, and commercial property coverage.

Not necessarily. Certain exceptions may be written directly into your motorcycle shop insurance policy, and some perils may be entirely uninsurable.

Yes, an LLC is meant to create a legal barrier between your business and your personal assets and credit. If you haven’t formed an LLC yet, use our Form an LLC guide to get started.

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.