What is New & Used Auto Dealer Insurance?

Running an auto dealership can be a profitable endeavor, but these businesses are exposed to a variety of risks. New & used auto dealer insurance can help protect Vermont dealerships from many of the property and liability risks they face.

New & used auto dealer insurance is a specialized commercial insurance that’s tailored to meet the needs of dealerships. Because dealerships face multiple risks, most of these policies come as package policies that have multiple coverages within them. Dealerships can usually choose the exact combination of coverages that they want in their policy.

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What Vermont Businesses Need Auto Dealer Insurance?

Vermont automotive dealerships generally need auto dealer insurance. This includes both new dealerships and used ones, and similar policies typically can meet the needs of both. Moreover, insurance is normally needed regardless of whether a dealership has passenger, recreational or commercial vehicles.

Not insuring a dealership at least leaves it exposed to potentially costly risks. It could also leave the dealership exposed to potential legal consequences.

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What Coverages Are Included in Auto Dealer Insurance?

The exact coverages found in auto dealer insurance policies can vary, but there are a number of property and liability protections that policies frequently offer. Property coverages primarily protect assets that a business has, while liability coverages are mainly for instances where a business might cause injury or damage to another party.

The property coverages that a policy will likely make available are:

The liability coverages that a policy will probably have available include:

  • General Liability Coverage, which might insure against common accidents and defamation suits
  • Auto Liability Coverage, which might insure against vehicle accidents involving company-owned vehicles (not necessarily inventory vehicles)
  • Dealership Plate Coverage, which might insure against accidents involving inventory vehicles that have temporary plates
  • Garage Keepers Liability Coverage, which might insure against damage to customer vehicles that are on company property
  • Product Liability Coverage, which might insure against injuries and damage caused by sold products
  • Auto Errors and Omissions Coverage, which might insure against mistakes made by technicians, financial personnel or salespeople
  • False Pretenses Coverage, which might insure against the improper release of a vehicle due to false pretenses

Still other coverages are available. An insurance agent who specializes in these policies can guide dealerships through all of their coverage options.

What Protections Does Dealership Plate Coverage Offer?

Dealership plate coverage normally insures vehicles that are in inventory and have temporary license plates. The coverage will usually protect the inventory vehicle and people in the vehicle if there’s an accident. Some policies also extend coverage to third-party claims arising from such accidents.

Because coverages terms and conditions vary, dealerships should carefully review a policy’s dealer plate coverage with an informed insurance agent to confirm what protections the policy affords.

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Do Auto Dealer Insurance Policies Come With Bonds?

Vermont automotive dealerships are normally required to carry a $25,00 to $35,000 bond by state law, with the precise amount being dependent upon a dealership’s sales and inventory. 

Auto dealer policies usually don’t include bonds within a policy itself, but many insurance companies that offer these policies also sell bonds. An insurance agent who’s familiar with auto dealer policies should be able to assist with purchasing a bond as well.

How Can Dealerships Get New & Used Auto Dealer Insurance Quotes?

For help comparing new & used auto dealer insurance quotes, contact Paige & Campbell Insurance. Our independent Vermont agents can help you compare policies from different insurers, and we have the expertise needed to help you choose the best policy for your dealership.

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