Research and development will make cars more popular. Car dealers and dealerships will be the ones to make the most of this. According to a survey in 2021, those selling cars all over the United States had a collective revenue amounting to $16 million.
Are you running a car dealership or working as a car dealer or auto broker? If so, consider getting insured. This article explores everything about car dealers insurance and auto dealership insurance. Their cost,policies offered and the best companies offering it.
Car Dealer Liability Insurance
Remember we mentioned earlier that insurance for car or auto dealers consists of specific insurance policies that actually provide the protection needed. One of these policies you need to be familiar with is car dealer liability insurance, which others like to call auto dealer liability insurance.
What does a dealer liability insurance do? This policy covers you if a client files a lawsuit because of economic loss, bodily injuries, or property damage.
General Liability Insurance for Car Dealers
General liability insurance in car dealer insurance accounts for bodily injuries and property damage. Of course, dealing cars is a job where hurting a client physically or causing property damage is impossible to happen.
You should know that a general liability insurance policy comes with optional coverages so that it can be tailored to the special needs of the policyholder.
In car dealer insurance, the typical general liability policy comes with advertising injury coverage.
A general liability policy with advertising injury coverage is useful for lawsuits arising from the following situations:
- When you said that a car has this particular feature, which in reality there’s none, to persuade the client to buy
- When you say defamatory statements or remarks about another person or entity so that the client will only buy a car from you
The general liability insurance included in your car dealer insurance typically has a $1 million policy limit. You can also find other quotes that offer a $2 million policy limit.
Professional Liability Insurance for Car Dealers
As a car dealer, avoiding careless errors at work is important as it nurtures a trusty facade which in turn, makes selling easier. But still, occasional mistakes are part of the job, and one should learn from it.
That’s why you should get professional liability insurance included in your car dealer insurance.
Professional liability insurance, otherwise called professional indemnity insurance, will protect you from lawsuits arising from mistakes at work, which caused economic or financial loss for the client.
a professional liability policy starts at $1 million. You can also get a quote offering $2 million. But know that some carriers offer custom limits for this dealer liability insurance and you can get coverage amounting to $500,000.
Additional Liability Policies Needed as a Car Dealer
Car dealer insurance doesn’t only offer liability policies. It might also include other useful coverages for car dealers such as commercial auto insurance, workers compensation insurance, and loss of income coverage.
Commercial Auto Insurance for Car Dealers
when you’re traveling using your own car, it might be a good idea to get commercial auto insurance for car dealers aside from auto dealer liability insurance.
Commercial auto insurance is not a policy on its own. Policies included in commercial auto insurance are auto liability policy, physical damage coverage, and underinsured/uninsured motorist coverage .
An auto liability policy included in commercial auto insurance for car dealers will help you pay for defense costs and victim compensation if ever you caused a vehicular accident.
Workers Comp Insurance for Car Dealers
The car dealership you’re working for has workers comp insurance that covers you in case you experience a work related injury. However, no one’s stopping you from getting workers comp insurance for yourself.
Typically, workers comp insurance only covers company employees. Therefore, this policy might not cover you if you’re getting it for yourself.
However, there are carriers that offer a stand alone workers comp insurance for self employed. In a nutshell, this is a type of workers comp insurance you can get even if there are no people working for you.
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Car Dealership Insurance
Insurance for car dealerships is a coverage for those selling cars but are not necessarily car dealers – meaning car business owners.
Sometimes called auto dealership insurance, this policy is composed of business insurance policies such as commercial property insurance, dealership liability insurance, workers comp insurance, inland marine insurance, and more.
Used Car Dealer Insurance
Do you deal used cars or second hand cars? Then know that you also need insurance as much as brand new car dealers. Technically speaking, you can qualify for a car dealer insurance program.
But note that if the carrier doesn’t cover you, decide to get used car dealers insurance or simply used auto dealers insurance as another option.
Auto Broker Insurance
The typical auto broker insurance or car broker insurance includes general liability insurance, commercial auto insurance for auto brokers, inland marine coverage, and professional liability insurance.
Used Car Dealer Insurance Application
The steps in qualifying for a used car dealer or dealership business insurance is very easy: Insurance companies only require the following documents or information for used car dealership insurance application:
- Business permit
- Business location
- Sample of inventory
- Business organization structure
- Some financial records
- Agency issued files that prove you’re not using the used car dealership for illegal acts
Help others make better decisions
Bond for Brand New and Used Car Dealerships
Brand new car dealerships and used car dealerships, like farmers auto group, are required to get a bond. Here’s a table showing how much bond a car dealer company needs to stay in business.
| Required Bond | Annual Bond Cost | |
| Alaska | $25,000 / $50,000 | $438 / $875 |
| Alabama | $25,000 | $250 |
| Arizona | $20,000 / $25,000 / $100,000 | $200 / $250 / $1,000 |
| California | $50,000 | $400 – $2,500* |
| Colorado | $5,000 / $50,000 | $100 / $450 |
| Connecticut | $50,000 | $500* |
| Delaware | $25,000 | $250 |
| Florida | $25,000 | $375 |
| Idaho | $10,000 / $20,000 / $40,000 | $100 / $200 / $400* |
| Illinois | $50,000 | $410 – $500* |
| Iowa | $75,000 | $375 |
| Kansas | $30,000 | $300* |
| Maine | $25,000 | $250 |
| Maryland | $15,000 – $300,000 | $150 – $2,250* |
| Minnesota | $5,000 / $50,000 | $100 / $300 |
| Mississippi | $25,000 | $115* |
| Missouri | $50,000 / $100,000 | $300 / $600 |
| Montana | $5,000 / $15,000 / $50,000 | $100 / $120 / $400 |
| Nebraska | $50,000 | $250 |
| New Hampshire | $25,000 | $187 |
| New Jersey | $10,000 | $100 |
| New Mexico | $12,500 / $50,000 | $125 / $500* |
| Nevada | Varies | Varies* |
| New York | $20,000 / $50,000 / $100,000 | $180 – $900 |
| North Carolina | $25,000 / $50,000 | $125 – $250* |
| North Dakota | $25,000 | $250* |
| Oklahoma | $25,000 | $306* |
| Oregon | $50,000 | $400 – $500* |
| Pennsylvania | $20,000 | $120 |
| Rhode Island | $50,000 | $500 |
| Tennessee | $50,000 | $875 |
| Utah | $10,000 / $20,000 / $75,000 | $120 / $240 / $900 |
| Vermont | Varies | Varies* |
| Virginia | $50,000 | $750 |
| Washington D.C. | $25,000 | $250 |
| West Virginia | $25,000 | $250* |
| Wyoming | $25,000 | $250 |
Wholesale Car Dealer Insurance
Policies carriers include in their wholesale auto insurance are commercial property insurance and product liability insurance.
Wholesale dealer property insurance will help you recoup costs if the stocks in your inventory got damaged by fire, theft, vandalism, and severe weather.
Get all the best quotes from leading providers in a click of a button!
Car Showroom Insurance
The coverage that’s perfect for you is showroom car insurance, which includes commercial property insurance with inventory coverage, earthquake coverage, theft coverage, and glass replacement coverage.
Car showroom insurance also includes liability policies such as employer’s liability, employment practices liability, and general liability.
Car Lot Insurance
Car lot insurance or dealers open lot insurance is sometimes referred to as physical damage coverage.
Generally, it will cover the vehicles for sale stored in a dealership’s car lot. Through this policy, the dealership can recoup losses if fire, theft, vandalism, hail, and severe weather damage the openlot cars.
Dealership Insurance Cost and Dealer Insurance Cost
Car Dealership Insurance Cost
- Car dealerships pay $36 a month or $432 a year for a $1 million general liability insurance
- New vehicle protection insurance offered by auto dealership insurance companies is $32 a month or $384 a year
- The car dealership insurance cost for mechanics warranty of work included in dealership/auto group insurance is $28 a month or $336 a year
- The cost of garage liability insurance offered by a car dealership insurance company is $38 a month or $456 a year
- Auto dealerships pay $42 a month or $504 a year for full coverage of commercial property insurance
- Auto dealerships pay $40 a month or $480 a year for workers comp insurance
Car Dealer Insurance Cost
- Car dealer insurance cost is $25 a month or $300 a year for a $1 million general liability insurance from a car dealership insurance company
- Auto dealer insurance cost is $19 a month or $228 a year for a $1 million cyber liability insurance from an auto dealer insurance company
- Auto dealers errors and omissions insurance is $23 a month or $276 a year for a $1 million coverage from car dealer insurance companies
- The cost of dealer automobile insurance is $22 a month or $264 a year for a $1 million auto liability coverage
- Self employed workers comp for vauto dealer is $18 a month or $216 a year based on the pricing of dealer insurance companies
Used Car Dealership Insurance Cost
- The cost of general liability insurance for used car dealerships is $41 a month or $492 a year for a $1 million coverage
- Dealer garage insurance cost for used car dealerships is $45 a month or $540 a year
- Used car dealerships pay $35 a month or $420 a year for dealer loaner car insurance
- Workers compensation for used dealerships is $21 a month or $252 a year
- Commercial property insurance for used car dealerships is $46 a month or $552 a year for full coverage
- Dealership loaner car insurance cost is $18 a month or $216 a year
Used Car Dealer Insurance Cost
- Auto insurance dealers selling used cars is $25 a month or $300 a year for a $1 million auto liability coverage
- A used dealers insurance company charge $39 a month or $468 a year for a $1 million general liability coverage
- Used auto dealer liability insurance cost for professional liability insurance is $27 a month or $324 a year
- Used car dealers pay $17 a month or $204 a year for a customers complaint legal defense coverage
For further reference, we made a table showing the cost of car dealer insurance and car dealership insurance based on the pricing of different carriers:
Best Car dealer Insurance Companies
Here’s a brief review of the best companies that insure brand new car dealerships or dealers and used car dealerships or dealers.
CoverWallet
CoverWallet offers stand-alone auto dealer insurance and used car dealer insurance. According to forums, it stands above all brand new car dealer and used car dealer insurance companies.
Unlike other car dealer insurance companies, CoverWallet offers all the most useful policies needed such as errors and omissions, general liability, lost income, workers compensation, and garage liability.
Average cost: $27 per month
Our rating: 10/10
Pros
- Insures used car dealers and brand new car dealers
- Also covers dealerships
- Has an intuitive quote comparison platform for vehicle trader insurance
- One of the best-rated auto dealers insurance providers
Cons
- Not an insurance company but one of the auto dealership insurance brokers selling the quotes of their partners
Hiscox Insurance
Hiscox doesn’t explicitly say that it has specialized commercial insurance for car dealerships. However, this company can still provide coverage as its policies are tailored for many businesses.
Average cost: $32 per month
Our rating: 9/10
Pros
- Hiscox insurance policies have generous policy limits
- Offers car dealer insurance uk
Cons
- Doesn’t have a specialized car dealer insurance
Allstate
Aside from providing coverage, Allstate car dealership insurance helps dealerships or dealers grow and make customers happy.
In terms of insurance, all state auto group insurance offers commercial property insurance, liability insurance policies, and special coverages.
Allstate offers B2B solutions such as vehicle service contract, appearance protection, dent and ding protection, auto dealer reinsurance, and more.
Average cost: $41 per month
Our rating: 10/10
Pros
- Allstate insurance in car dealerships offers commercial property, liability, and special policies
- Helps your business grow and make customers happy
Cons
- Insures auto dealers but insurance products from Allstate are more tailored to the needs of dealership
USAA
USAA insures in-service military or military veterans who are making money by running a dealership or working as car dealers.
This company offers commercial property, garage liability, and part time car dealer insurance policies in its usaa auto brokers, dealers, and dealerships protection.
If you manage to get insured by this company, you’ll enjoy usaa car dealer discounts.
Average cost: $48 per month
Our rating: 10/10
Pros
- Stands above all dealership insurance companies when it comes to insuring military veteran car dealers; or dealerships owned by military veterans or in-service military personnel
- Commercial auto insurance for car dealers is very cheap
Cons
- Doesn’t have auto dealer garage liability insurance
Nationwide
Nationwide’s auto dealer insurance offers commercial property, business liability, commercial auto, crime insurance, business income, employment practices liability, and cyber liability.
With Nationwide, you’ll not only get protected but also enjoy other services such as loss control and risk management, free business resources, and tailored coverage.
Average cost: $58 per month
Our rating: 7/10
Pros
- Has a lot of business insurance policies for auto dealers
Cons
- Doesn’t have car lot insurance
- Doesn’t offer reinsurance for car dealers
