Last Updated: February 22, 2024, 2:38 pm by TRUiC Team

Small Engine Repair Business Insurance

Getting insurance for your small engine repair business is pivotal.

This is because small engine repair businesses need to be protected against negligent acts or omissions, employment law disputes, and personal injuries. 

For example, if you or an employee accidentally damages a client’s small engine while attempting to repair it due to negligence, a compensation lawsuit could be filed against you. 

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 Small Engine Repair Business

General liability insurance is — generally speaking — one of the most important insurance policies for small engine repair businesses.  

Some of the risks general liability insurance covers are:

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

Having said that, you will likely need to purchase additional coverage in order to “fully” protect your business’s assets.

This is because a general liability policy will not protect you from all applicable risks, such as those that relate to: 

  • Workers’ compensation insurance: Protects you in the event that an employee gets injured while working for your business. 
  • Business interruption insurance: Covers part of your lost income in the event that you are required to temporarily halt operations due to a covered risk. 
  • Commercial auto insurance: Will cover damage to your own or a third-party vehicle if you or an employee gets in an accident while driving a company car.

When you are ready to purchase your business insurance, you will need to decide what insurer you will go with. Even though there are several great options available, we recommend going for an online insurer as a small business owner in 2024. 

This is because online insurers use AI instead of a life insurance agent to generate quotes and can thus benefit from having lower operating costs. This lets them offer much more affordable rates.

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Cost of General Liability Insurance

On average, small engine repair 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 small engine repair business 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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Common Situations That General Liability Insurance May Cover for a Small Engine Repair Business

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Example 1: One of your repair technicians accidentally knocks over a line of electric generators from a landscaping customer. Most of the generators require minor repairs, but a few need a full replacement. Your general liability policy would cover the repair and replacement costs for the broken generators.

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Example 2: While testing a customer’s lawnmower, you temporarily lose control of the machine and run over the customer’s foot. General liability insurance would pay for the customer’s medical bills related to the accident as well as your legal fees and any damages if the customer pursues a lawsuit.

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Example 3: As a customer discusses a repair job with a mechanic in your service bay, a hydraulic lift malfunctions and hits him. The impact causes serious injuries. Your general liability insurance would cover the customer’s medical bills and any other damages if he decides to sue.

Other Types of Coverage Small Engine Repair 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 of the most common types of coverage:

Commercial Auto Insurance

Every vehicle you use for business purposes—from deliveries to towing—requires commercial auto coverage. If you use personal vehicles for work-related duties, your personal car insurance won’t pay for damages to your car in the event of a work-related accident. Commercial auto insurance protects all vehicles you use on-the-job in the event of an 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.

Crime Insurance

If a burglar steals a customer’s property from your shop or you encounter an instance of employee dishonesty, crime insurance protects your business by covering any costs related to the incident.

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 small engine repair 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.

Small Engine Repair 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.

We recommend purchasing your business insurance before you start your business in order to avoid a situation in which a lawsuit is filed against you, and you are not yet covered. 

Note: If you decide to purchase or lease a company vehicle in order to travel to your client’s locations, you will likely be required to purchase commercial auto coverage. 

Not necessarily. Certain exceptions may be written directly into your small engine repair business 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.