Auto Dismantlers Insurance Illinois Policy Information
Auto Dismantlers Insurance Illinois. Auto dismantling is one of the fastest growing industries in the United States, as it generates an impressive $5 billion each year. It's estimated that the scrap metals that are produced by auto dismantling yards supply around 80% of the metals that are used in the construction of new vehicles.
Add to that all of the parts from wrecked, junk, or discarded vehicles that are sold, refurbished, and recycled and it's no wonder why the auto dismantling industry is booming.
Automobile and truck dismantlers salvage fluids, tires and other parts from unusable vehicles, such as those that have been abandoned, involved in accidents, or simply worn out ("end of life" vehicles). These recycled fluids, tires and other parts are sold directly to consumers, retailers or wholesalers.
Some dismantlers permit customers to remove the parts from vehicles. Some have metal crushing devices to compact the vehicle after usable parts have been removed to sell any remaining metal as scrap. The dismantler must obtain and record the proper titles and transfers of the vehicles being dismantled to assure that all legalities are met and no fraud or theft is involved.
Dismantlers often pick up and tow the vehicle to be dismantled. They may also offer towing services to other repair operations, auto clubs, or government entities.
If you're thinking about taking advantage of the opportunity that this industry presents, you need to make sure that you are properly prepared, and there's a component of your preparations that you don't want to overlook: auto dismantlers insurance Illinois.
Auto dismantlers insurance Illinois protects your salvage and dismantling business from lawsuits with rates as low as $67/mo. Get a fast quote and your certificate of insurance now.
Why Do Auto Dismantlers Need Insurance?
Just like a business in any other field, as the owner and operator of an IL auto dismantling operation, you face a number of risks. Some of those risks are similar to what other businesses face; for example, a third-party or an employee could sustain an injury at your salvage yard, the office you run your operations out of could be damaged in a storm, or your yard could be vandalized or robbed, for example.
IL auto dismantlers also face certain risks that are unique to their industry. For instance, a client could claim that you cheated them out of money, or the vehicles that you dismantle could leak fluids and impact the drinking water supply.
As the owner and operator of your business, you are liable for all risks, whatever they may be. That means that you could end up having to pay out a lot of money in repairs, medical expenses, environmental cleanup fees, and legal fees. Needless to say those types of expenses can be astronomical. Imagine if you had to pay for them out of your own pocket?
Chances are that you would end up in a serious financial crisis and you could possibly even lose your business.
That's why having the right type of auto dismantlers insurance Illinois coverage is so important. If you're properly insured, if any issues do arise, instead of paying the related expenses yourself, your carrier will cover them for you. In other words, insurance can help you avoid crippling losses.
Add to that the fact that auto dismantling operations are legally required to carry certain types of insurance. If you aren't insured, you could end up in serious legal trouble and possibly even lose your business.
What Type Of Insurance Do Auto Dismantlers Need?
What specific type of coverage do IL auto dismantling companies need? That depends on several factors; the size of your operation and where it is located, for example.
That's why it's so important to speak with a reputable insurance agent so you can find out exactly what type of auto dismantlers insurance Illinois coverage you'll need, as well as what your policy limits should be.
With that said, however, there are some basic coverages that all auto dismantlers should carry, regardless of the specifics of their operation. Examples of policies of some of the polices you should have include:
- Commercial General Liability - In the event that you are ever faced with a third-party liability claim, commercial general liability insurance will cover the costs. For example, if a client were to trip over a piece of equipment at your yard, break a leg, and file a lawsuit against you, this coverage would pay for your legal defense fees and any compensation that a court may find you liable for.
- Commercial Property - If your salvage yard were to go up in flames or a tree were to fall on top of your office, commercial property insurance would come to the rescue. This policy covers your commercial property and the contents it contains from the losses that are associated with acts of nature; floods, storms, fires, vandalism, and theft, for example.
- Environmental Liability - Because you deal with vehicles, and vehicles contain oils, gas, antifreeze, and other solvents that could be dangerous to the environment, you'll also need environmental liability insurance. If any of the vehicles on your property were to leak contaminants, this policy would help to cover the cost that would be associated with cleanup efforts, as well as any legal fees you may face.
These policies are just a few examples of the type of auto dismantlers insurance Illinois you'll need to carry as the owner and operator of an IL dismantling and salvage business.
IL Auto Dismantlers' Risks & Exposures
Automobile exposures can be high if the dismantler transports hazardous waste to recycling or waste disposal facilities as the transporting vehicle may be bulky. All employee drivers should have appropriate driver's licenses and their MVRs regularly checked. All vehicles must be regularly maintained with records kept.
Towing of vehicles not meant for dismantling can result in damage to those vehicles. Tow truck drivers must be well trained in the proper way to secure the vehicles and must be able to use the most appropriate method of transport. Towing vehicles must be regularly checked, particularly the hoists and tow bars.
Garagekeepers exposure comes from damage that can occur to customers' vehicles being towed for purposes other than dismantling.
Premises liability exposures is high due to the number of visitors to the premises. Customers who remove parts from autos may be injured by cuts, burns, equipment, or falling objects. They may trip or fall over other vehicles or parts, particularly during inclement weather. Smoke, dust, odors, or noise present a nuisance exposure for adjacent properties.
Accumulation of water in tires stored outside can provide breeding grounds for mosquitoes. Parking lots and sidewalks need to be in good repair with snow and ice removed, and generally level and free of exposure to slips and falls. If the premises is open after dark, there must be adequate lighting and appropriate security for the area.
Salvage yards present an attractive nuisance hazard. Fences and chains should be in place to prevent entrance after hours.
Products liability exposure is generally low as the vehicles being salvaged are no longer usable. If the dismantler repairs or installs used parts for customers, the exposure increases to that of a manufacturer.
Environmental impairment exposure is very high due to the presence of gasoline, mercury, lead, fuel oil, battery acid, solvents, and other hazardous wastes. The crushed vehicles can leak fluids which must be caught and not allowed to soak into the soil or pollute water sources. Storage tanks must be leak-proof and regularly maintained.
Spillage and leaking of pollutants into the air, ground, or water can result in high cleanup costs and fines. Adequate spill procedures should be in place and must be followed to prevent any leakage or contamination. Contracts should be in place to dispose of all environmentally dangerous chemicals.
If the dismantler hauls fluids or other contaminants to recycling or waste treatment facilities, a collision or overturn can result in pollution to air, soil, or water.
Workers compensation exposures can be very high. Trips and falls over salvaged vehicles or vehicle parts are common. Lifting of a vehicle by hoists, jacks, and other mechanical means can result in injury should the equipment malfunction. Hoists must be well maintained and procedures in place to prevent vehicles from falling. Safety measures must be in place while the crusher is in operation to prevent an employee from falling or being pulled into the machine.
Lifting by nonmechanical means can result in back injuries, hernias, sprains and strains. Leakage of battery acids, burning of waste materials, and welding operations can result in burns. Cuts are common from cutting vehicles apart. Foreign objects in the eye and hearing impairment from noise can result from dismantling operations.
Handling of toxic materials can result in respiratory injuries, eye injuries, or contact dermatitis. Employees should be provided with safety equipment, trained on proper handling techniques, and have conveying devices available to assist with heavy lifting.
Property exposures are high due to flammables such as lubricants, oils, degreasers and solvents used to clean parts, fluids remaining in the vehicles to be salvaged, and from welding operations. Proper drainage of all fluids from the vehicle prior to crushing is important to prevent explosions. Each type of fluid must be stored in explosion-proof containers.
Gasoline drained from the vehicles being dismantled is often kept on premises to service and refuel owned vehicles. Flammables, including tanks and gases used for welding, must be properly labeled, stored and separated. Furnaces used to dispose of waste materials may overheat.
Electrical wiring must meet current codes and be adequate for the occupancy. Ongoing maintenance of equipment is critical as even a small fire can result in substantial damage. There should be automatic shutoffs to prevent furnaces from overheating. Smoking should be prohibited.
Tires removed from vehicles to be dismantled do not catch on fire quickly; however, when they do burn, the fire is difficult to put out and an oily smoke permeates the entire area.
Equipment breakdown exposure is high as the business is dependent on its machinery for conducting operations. Replacement parts may be difficult to obtain on a timely basis.
Inland marine exposures are from accounts receivable if the dismantler offers credit, computers to monitor inventory, contractors' equipment for machinery used to crush and dismantle the vehicles, goods in transit if parts are delivered to customers, and valuable papers and records for salvaged vehicle titles and other information. Backup copies of all records, including computer records, should be made and stored off premises.
Crime exposures come from employee dishonesty and theft of money and securities. Background checks should be conducted on all employees. All ordering, billing, and disbursements must be handled as separate duties. Regular audits should be conducted.
Receipts should be provided for any cash transaction. Money should be regularly stripped from the cash drawers and placed in a safe away from the front door. Irregular drops should be made to the bank to prevent a substantial accumulation of cash on the premises.
Auto Dismantlers Insurance - The Bottom Line
For more information on auto dismantlers insurance Illinois, speak with an experienced agent who specializes in commercial insurance and understands the many unique exposures and risks that IL auto dismantlers face.
Illinois Economic Data & Business Insurance Requirements
For moguls who are thinking about conducting business-related affairs in Illinois, it's important to have an understanding of the state's economic outlook. It's also a wise idea to familiarize yourself with the regulations regarding IL commercial insurance.
Here we provide some insight regarding the data that pertains to economy of Illinois. We also provide a brief overview about the types of commercial insurance coverage business owners are required to invest in, or should invest in, even if it isn't mandatory.
Business Economic Trends In The State Of Illinois
According to several reports that compile the economic data for each of the 50 states and compare that information to the national average, Illinois isn't in the best position. While there has been some improvement, the gains have only been slight. Income and employment rates have risen, and the housing market has increases; however, the gains in these areas have been minimal, especially when compared to the gains that other states have experienced.
While the unemployment rate has improved, falling to 4.8 percent in 2017 after it was stuck at a rate of almost 6 percent in 2016 and 2015, it appears that in reality, the IL labor force and employment gains are contradicting. In 2022, tens of thousands of people fell out of the state's labor force.
Looking to the future, it is predicted that while the employment rate in Illinois will grow, the rate at which it will grow will be much lower than the national average. Currently the projected annual job growth of the state is .5 percent. Following are some of the largest industries in IL.
- Service Industries
Illinois Commercial Insurance Regulations
The Illinois Department of Insurance regulates insurance in IL. Businesses are required to carry workers compensation insurance. Workers comp is mandatory for any business that employs either an hourly or a salaried workforce, even if that workforce is just one person. Organizations are also required to carry IL commercial auto insurance if they use vehicles for any business-related reasons, such as deliveries, transport, or client visits.
General liability insurance is not required, nor is commercial property insurance; however, it is a wise idea for companies to invest in this type of coverage, as it will safeguard from lawsuits or losses that their properties could sustain.
Additional Resources For Construction Contractors Insurance
Learn about construction contractors insurance, including how much the premium costs and what is covered - and how business insurance can help protect your construction business from lawsuits.
- Blasting & Drilling Contractors
- Bridge Contractors
- Building Contractors
- Cable Layers
- Demolition Contractors
- Dock & Pier Contractors
- Dredging Contractors
- Foundation Layers
- General Contractors
- Road Contractors
- Sewer Contractors
- Steel Erection Contractors
- Surety Bonds
Construction contractors have substantial needs for many types of insurance coverage. Most would point to the importance of coverage for completed operations, premises liability coverage during construction operations at jobsites and professional or design errors and omissions insurance.
Such coverages can be provided only when the interests of the contractor and of the property owner are understood; particularly the contractual obligations assumed by the contractor. Next in significance is the workers compensation exposure followed by business automobile. Inland marine coverage for expensive mobile equipment, supplies, other tools of the trade and builders' risk can be vital.
Liability coverage is needed by a construction contractor in order to obtain most jobs. In addition, if a contractor wants to stay in business, it must be obtained to protect it from lawsuits due to its premises operations, off-site locations and products/completed operations exposures. Owners and contractors protective liability and railroad protective liability coverages may also be required in certain cases in order for a contractor to meets its obligations for particular jobs.
Many construction contractors do not have the usual location-specific buildings and business personal property exposures. Their business property is more mobile and, therefore, better covered with inland marine coverage forms. However, for those larger construction contractors that own buildings and/or maintain business inventory there are many coverage forms and choices available to them.
Construction contractors use their vehicles to get to and from their workplaces and jobsites. They also use vehicles to transport equipment and inventory to those locations. It is important to cover the liability of these vehicles for injury or damage they may cause, as well as to provide coverage for damage to the vehicles themselves.
Employers are required to provide coverage for injuries sustained by their employees while on the job. Construction contractors must comply with these requirements but some try to avoid them by hiring subcontractors. These subcontractors may actually operate and qualify as employees. The relationship between a contractor and its subcontractors must be carefully evaluated in order to determine if workers compensation coverage is still needed.
Minimum recommended small business insurance coverage: Business Personal Property, Employee Dishonesty, Surety Bonds, Accounts Receivable, Builders' Risk, Computers, Valuable Papers and Records, General Liability, Employee Benefits Liability, Umbrella Liability, Business Automobile Liability and Physical Damage, Hired and Nonowned Auto Liability & Workers Compensation.
Other commercial insurance policies to consider: Building, Business Income with Extra Expense, Earthquake, Flood, Leasehold Interest, Real Property Legal Liability, Contractors' Equipment, Goods in Transit, Installation Floater, Cyber Liability, Employment-related Practices Liability, Environmental Impairment Liability, Stop Gap Liability, Unmanned Aerial Vehicles (UAV) (Drones).
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