Auto Paint Shop Insurance Michigan Policy Information
Auto Paint Shop Insurance Michigan. Custom paint jobs, classic car restorations, collision repairs; as an auto body paint shop, you offer an invaluable service. Your customers rely on you to improve the appearance of one of their most prized possessions: their cars.
Automobile paint shops paint, rustproof, or coat vehicles or vehicle parts. They are not involved in mechanical repair work. The shop may offer custom paint jobs based on customers' designs.
From selecting the proper colors to using the highest quality paints, and from using the most advanced techniques and to employing the most state-of-the-art technologies, you always go the extra mile to ensure that you meet the needs and exceed the expectations of your clients.
Of course, you also take extreme care to make sure that their property is well-protected when it is in your possession. However, despite your best efforts, you never know when something can go wrong, and when it does, you could be held liable and may be responsible for some pretty steep costs.
In order to protect yourself, your clients, and your employees from the unexpected, investing in the right type of auto paint shop insurance is an absolute must. Why is insurance so important? What type of coverage do you need? For an overview of auto body paint insurance, keep on reading.
Auto paint shop insurance Michigan protects car and truck painting businesses from lawsuits with rates as low as $37/mo. Get a fast quote and your certificate of insurance now.
Why Do Michigan Auto Paint Shops Need Insurance?
Just like business owners in any industry, as the owner and operator of an auto body paint shop, you're exposed to a variety of risks. Some of those risks are similar to those that all business owners face, while others are unique to your particular industry.
Examples of some of the different risks that are associated with running an auto body paint shop include:
- Third-party bodily injury and property damage lawsuits and settlements
- Commercial property damage
- Employee accidents and injuries
- Lawsuits from clients who claim you damaged their vehicles while they were in your possession or that you made a mistake with the services you provided
- Accidents with your commercial vehicles
The above are just some of the risks that MI auto body paint shops are exposed to, and as the owner and operator of the business, if something goes wrong, you're responsible for the related costs.
Without auto paint shop insurance Michigan, the burden of those expenses will fall directly on your shoulders; however, if you are properly insured and something goes wrong, your insurance company will help to cover the costs of the associated expenses.
In other words, commercial insurance can help to protect you from unexpected and exorbitant expenses and serious financial hardship.
What Type Of Insurance Do MI Auto Paint Shops Need?
There are several different types of coverage that auto body paint shops should invest in.
While the specific type of coverage that's needed varies and depends on several factors, including where your business is located, the size of your shop, and the specific services you offer, there are certain types of coverage that all auto body paint shops should have. Examples of the most essential types of auto paint shop insurance Michigan coverage include:
- Commercial Property: With this insurance, the physical structure of your auto body paint shop, as well as the contents within it and some of the exterior structures, will be protected from damages or losses that are caused by acts of nature, theft, or vandalism. For instance, if a thief were to break into your shop and steal equipment, commercial property insurance would cover the cost of the damages that need to be repaired, as well as the equipment that would need to be replaced.
- General Liability: This type of auto paint shop insurance Michigan coverage protects your business from third-party physical or personal injury or property damage claims. For example, if a vendor delivering an order were to trip and fall over a piece of equipment on your commercial property and they were to file a lawsuit against you, this insurance would help to pay for your legal defense fees, as well as any costs that you may be found responsible for.
- Workers Compensation: If you have employees will most likely need to carry workers comp insurance. In the event that an employee suffers a work-related accident or injury, in circumstances that indicate your company could be held liable, it covers the employee's medical expenses along with wages lost to related work absences.
- Commercial Auto: Any business that uses vehicles over the course of its activities will further need commercial auto insurance. It covers both property damage (to third party vehicles) and bodily injury relating to the business use of your cars or other vehicles.
The above are just three of the types of auto paint shop insurance Michigan coverage needed. For more information and to find out how to properly protect your business, consult with an experienced and reputable commercial insurance agent.
MI Auto Paint Shop's Risks & Exposures
Commercial auto exposures are generally limited to hired and non-owned for employees running errands to pick up needed supplies. If there are owned vehicles, all employee drivers should have appropriate driver's licenses and their MVRs regularly checked. There should be written procedures for personal and permissive use of vehicles furnished to employees. All vehicles must be regularly maintained with records retained.
Garagekeepers exposure comes from damage that can occur to customers' vehicles while in the paint shop's care, custody and control. Keys to customers' vehicles should be kept in a locked box to prevent unauthorized access. Proper identification should be required to prevent handing a customer's car to the wrong owner. Lots must be well lighted, and chains should be in place to prevent transport. Fences and other security also may be appropriate.
Premises liability exposure is moderate due to the number of visitors to the shop. Customer waiting areas should be provided. Customers must not be permitted in the service area. To prevent slips and falls, floor coverings should be in good condition with no frayed or worn spots on carpet and no cracks or holes in flooring.
Steps and uneven floor surfaces should be prominently marked. Sufficient exits must be provided and be well marked, with backup lighting systems in case of power failure. There should be a disaster plan in place for unexpected emergencies.
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. Cars in the parking lot present an attractive nuisance hazard. Chains may be required to prevent entrance after hours.
Environmental impairment exposures can be very high due to disposal of waste paints, solvents and other hazardous or toxic substances. A spillage and leaking of pollutants into the air, ground, or water can result in high cleanup costs and fines. Adequate 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.
Workers compensation exposures can be high. 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. Workers can slip and fall, or incur back injuries, sprains, strains or hernias from lifting.
Fumes and vapors from the painting operations can cause respiratory problems 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 exposure is high due to the use of flammable paints, chemicals, and solvents in painting operations. These must be properly labeled, separated, and stored away from combustibles. Aerosols and flammable additives contribute to the overall fire load. Painting, coating, and rustproofing should be in spray booths with good ventilation, UL-approved wiring and fixtures and adequate controls.
If part of the operation, welding needs to be evaluated for proper handling of the tanks and gases, as well as adequate separation from the other operations with either a separate room or flash/welding curtains.
Inland marine exposure comes from accounts receivable if the paint shop offers credit, computers to monitor inventory and assist in paint mixing and application, and valuable papers and records for customers' and vendors' information. Backup copies of all records, including computer records, should be made and stored off premises.
Crime exposure is high for both 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 must be conducted. 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 Paint Shop Insurance Michigan - The Bottom Line
To protect your business, employees and customers, having the right auto paint shop insurance Michigan coverage is essential. To see what options are available to you, how much coverage you should invest in and the premiums - speak to a reputable commercial insurance agent.
Michigan Economic Data And Business Insurance Requirements
Business owners who are interested in establishing operations Michigan must have a thorough understanding of the state's economy. They should also familiarize themselves with any regulations and limits that state may have in place for commercial insurance.
Any entrepreneur who is thinking about starting a business in the Great Lake State first needs to determine if it's a feasible location for business operations. As such, it's important to have a keen understanding of pertinent details regarding the economy of Michigan, in addition to the types of insurance coverage that are mandatory for corporations that operate within the state.
Economic Trends for Businesses In Michigan
After a long period of stagnant job growth in the early part of the 21st century, MI has been experiencing a steady increase in employment gains. Between 2009 and 2018, the state has enjoyed a period of uninterrupted job growth; the longest stretch of job growth since World War II. According to economists at the University of Michigan. While there has been a slight decline in the rate of job growth, job creation continues and forecasters say will continue for the next two years, into 2021.
In 2018, an estimated 55,200 jobs were created; in 2019, it's expected that 35,800 jobs will be created, and in 2020, economists believe that there will be a total of 39,300 jobs created in Michigan. While that rate of growth is 1.9 percent slower than the job growth rate between 2011 and 2016, it is still a steady increase overall. In total, approximate 683,200 jobs will be created in MI between 2099 and 2020; almost four out of the five jobs that were lost during the early part of the 21st century will be recovered.
While the unemployment rate has steadily improved, it is still above the national average. In March of 2019, the national unemployment rate was 3.8 percent, while in the state of Michigan, it was 4.0 percent. Mid-Michigan has experienced the largest growth rate in the state, and according to forecasters, it looks like that trend will continue, moving forward. Industries that are expected to see the most growth include:
- Energy, due largely to research and development in clean energy
- Food and agriculture
- Transportation and mobility
- Healthcare industry
- Information and technology
In the state of MI, business owners are not legally required to carry liability insurance; but most entrepreneurs opt to invest in a General Liability or Business Owner's Policy (BOP). A commercial auto insurance policy is also required for any businesses that use motor vehicles to conduct any aspect of their business operations. Workers' compensation insurance is also required for any businesses with non-owner employees. While the following forms of coverage are not required, depending on the type of business you operate, they are recommended:
- Data breach insurance
- Business income insurance
- Commercial Umbrella insurance
Additional Resources For Auto Service & Repair Insurance
Read useful small business auto service and repair insurance policy information. In an aotu related business, you need to have the right type of commercial insurance coverage so that your garage, employees, and customers vehices & other property is protected.
- Auto Dealers
- Auto Detailing & Mobile Car Wash
- Auto Dismantlers
- Auto Garage
- Auto Glass Repair Shops
- Auto Paint Shops
- Auto Service Repair
- Auto Supply Parts Store
- Car Rental
- Car Wash
- Gas Station
- Motorcycle Dealers
- Parking Lot
- RV Dealers
- Snowmobile Dealers
- Truck Rental
- Used Car Dealer
There is a Auto Service Risks Program is an enhancement of the Commercial Package Policy that is available to certain Auto Service Operations.
Automobile repair shops and garages offer a wide variety of mechanical services, from engine repair to tune-ups. The operation may be stand-alone or be part of another business such as an automobile dealership or filling station.
Gasoline stations are normally limited to the dispensing of gasoline, kerosene, diesel or fuel oil with incidental sales of auto accessories and pre-packaged snack food items. Larger gasoline stations may offer other services, such as auto repair, retail sales of food or auto parts, snack bar or restaurant, propane tank exchange, towing, or baths and overnight lodging facilities for truckers.
Car washes provide facilities for cleaning automobiles and other motor vehicles. Some are drive-through with either partially or fully automated conveyance of the vehicle throughout the operation. Hand washing, waxing, or interior cleaning of the vehicle may be offered, with customers sent to a waiting area. Damage to the customers' vehicles is the primary exposure as machinery and washes can break antennas, pull off stripping, crack glass and damage tires.
The three basic types of risks that are contemplated by the Auto Service Risks Program include:
- Repair Shops - operations primarily engaged in auto repair. This includes shops that do body, fender, radiator, ignition service and paint work.
- Service Stations- operations primarily engaged in servicing autos. The sale and installation of auto accessories are a part of this category as long as major engine or bodywork is not performed. Car wash facilities are eligible.
- Storage garages and other parking places.
The following classifications are specifically listed as eligible: Automobile:
- Quick Lubrication Services
- Repair or Service Shops
- Repair Shops–Self Service
- Car Washes–self-service and full-service
- Convenience Food/Gasoline Stores–self-service, full-service and combined
- Gasoline Stations–self-service, full-service and combined
- Parking–public-open air and not open air
Automobile, motor home, mobile home, trailer, and motorcycle dealers are NOT eligible for this program.
Minimum recommended small business insurance coverage: Building, Business Personal Property, Business Income, Equipment Breakdown, Employee Dishonesty, Money and Securities, Accounts Receivable, Computers, Signs, Valuable Papers and Records, General Liability, Employee Benefits, Environmental Impairment, Underground Storage Tank Liability, Umbrella, Hired and Non-owned Auto & Workers Compensation.
Other commercial insurance policies to consider: Earthquake, Flood, Computer Fraud, Forgery, Goods in Transit, Cyber Liability, Employment-related Practices, Business Automobile Liability and Physical Damage, Garagekeepers and Stop Gap Liability.
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Also find MI local small businesses by General Liability Class Code and learn about Michigan small business insurance requirements for general liability, business property, commercial auto & workers compensation including MI business insurance costs. Call us (313) 344-7177.