Garagekeepers Insurance for Auto Repair Shops

By the Repair Shop Insurance editorial team · Updated September 27, 2026

What garagekeepers insurance covers

When a customer leaves a vehicle with you for service or repair, it is in your care, custody, or control. Garagekeepers insurance covers physical damage to that vehicle while you have it, from causes such as:

• fire in the shop, or a vehicle falling from a lift or jack;
• theft of, or break-ins to, cars on your lot or in your building;
• vandalism, hail, wind, and flood, depending on the coverage selected;
• collision while an employee moves the car around the lot or takes it on a road test, if collision coverage is included.

Garagekeepers is usually written as a coverage part or endorsement alongside your liability or auto coverage, with its own limit and deductible. Covered causes of loss, limits, and exclusions vary by insurance company.

Why your liability policy doesn’t cover customers’ cars

Liability policies, including garage liability and general liability, generally exclude damage to property in your care, custody, or control. The logic is that liability insurance is for harm to other people’s property — not property you’ve taken responsibility for. A customer’s car in your service bay falls into that exclusion, which is exactly the gap garagekeepers fills.

The same goes for property coverage: your property policy covers your building, tools, and equipment, not vehicles that belong to customers.

Legal liability vs. direct coverage

Garagekeepers coverage is usually offered in three forms. The difference is when it pays, and it affects how a claim feels to your customer.

Legal liability coverage costs less, but it can put you in the position of telling a customer that their own insurance has to handle damage that happened at your shop. Many shops choose a direct option for that reason. Availability of each option varies by insurance company. The difference shows up most clearly in a not-at-fault accident — see road test coverage.

How much garagekeepers coverage do you need?

Garagekeepers limits generally apply per location, with a deductible per vehicle or per loss. To estimate a limit:

1. Count the most customer vehicles you ever have on site at once — during a busy week, not an average day.
2. Include vehicles kept overnight, waiting on parts, or left for extended repairs — a big factor for body and collision shops.
3. Estimate what those vehicles are worth together, and allow for newer or higher-value vehicles.

If a fire or storm damaged every car on your lot at once, would the limit cover it? If not, the difference comes out of your pocket.

What garagekeepers typically doesn’t cover

• The cost of correcting faulty work or replacing defective parts you installed (see faulty workmanship coverage).
• Customers’ personal belongings left inside the vehicle.
• Vehicles you own, including loaners and shop vehicles — those belong on a commercial auto policy.
• Losses beyond the limit, or causes of loss not selected on your policy.

Garagekeepers vs. garage liability vs. property

These three are often confused. Put simply:

• Garage liability covers injury and damage your shop causes to other people and their property.
• Garagekeepers covers customers’ vehicles while they’re in your care.
• Property covers what your business owns — the building, tools, equipment, and parts.