RV Dealers Insurance Policy Information
RV Dealers Insurance. As the owner and operator of an RV dealership, you face quite a few risks. Not only do you have to make sure that your inventory is protected, but you also have to ensure the safety of your dealership, as well as your staff and anyone else you may enter your property.
In the event that something goes wrong, you'll be responsible for any related expense. In order to protect yourself from serious financial losses, investing in the right type of RV dealers insurance coverage is an absolute must.
Recreational vehicle dealers sell new and/or used vehicles and generally provide other services, such as financing and insurance for vehicle purchasers. Most sell parts and accessories, provide repair and body work, and offer vehicle rental and leasing. Some provide towing services.
Most dealerships purchase new recreational vehicles directly from manufacturers, financing the purchase through arrangements with either the manufacturer or a bank. Used vehicles are generally obtained as trade-ins from customers purchasing newer models, or from auctions.
While a selection of vehicles may be displayed in a showroom, most are stored in open lots outside the building.
What kind of insurance coverage do RV dealerships need? Why is being insured so important?
Below, you'll find the answers to these questions so that you can properly protect yourself, your business, and the people who work with your dealership.
RV dealers insurance protects recreational vehicle dealerships from lawsuits with rates as low as $67/mo. Get a fast quote and your certificate of insurance now.
Below are some answers to commonly asked recreational vehicle dealerships insurance questions:
- What Is RV Dealers Insurance?
- How Much Does RV Dealers Insurance Cost?
- Why Do RV Dealers Need Insurance?
- What Type Of Insurance Do RV Dealers Need?
- What Does RV Dealers Insurance Cover & Pay For?
What Is RV Dealers Insurance?
RV dealers insurance is a type of insurance coverage that is specifically designed for businesses that sell recreational vehicles (RVs). This insurance provides coverage for a variety of potential risks that RV dealers may face, including liability claims, property damage, theft, and other types of losses.
RV dealers insurance typically includes general liability coverage, property coverage, inventory coverage, and business interruption coverage. This type of insurance is essential for RV dealers as it protects their assets, employees, and customers from financial losses resulting from unexpected events or accidents.
How Much Does RV Dealers Insurance Cost?
The average price of a standard $1,000,000/$2,000,000 General Liability Insurance policy for small recreational vehicle dealerships ranges from $67 to $89 per month based on location, services offered, revenue, claims history and more.
Why Do RV Dealers Need Insurance?
Just like any other type of business owner in any other industry, as an RV dealership owner, you are exposed to a number of risks. Some of those risks are similar to the risks that other businesses are exposed to; however, some of those risks are unique to your specific business.
For example, someone could steal or vandalize one of the RVs on your lot, your dealership could go up in flames, you could be forced to close down for a while, or one of your employees could get injured on the job.
No matter what happens, as the owner and operator of an RV dealership, you will be responsible for anything that goes wrong. The costs that are associated with property damages, medical care, and legal fees, for example, can be exorbitant. If you needed to pay those expenses out of your own pocket, you could end up in serious financial trouble.
By the right kind of RV dealers insurance coverage, if something does happen, instead of having to pay the related expenses yourself, your carrier would cover them for you.
In addition to protecting you from serious financial losses, having the right type of insurance coverage ensures that you are compliant with local laws. RV dealerships are legally required to carry certain types of insurance; if they fail to, they could be hit with stiff fines and could potentially end up losing their business.
What Type Of Insurance Do RV Dealers Need?
There are quite a few different types of insurance coverage that RV dealers will need to carry. The exact type of insurance you'll need depends on the specifics of your dealership; where it's located, the type of inventory you carry, the size of your operation, and more.
Because insurance needs vary from dealership to dealership, consulting with an insurance agent who has experience with the unique needs of your specific type of business is important. To give you a basic idea of RV dealers insurance coverages that most will require, however, take a look below:
- Commercial Property: To protect your business property, including the buildings on your dealership, as well as the contents within those buildings, you'll need to carry commercial property insurance. This type of coverage protects you from certain perils, such as fires, pipe leaks, storm damage, vandalism, and theft.
- Commercial General Liability: This policy offers broad coverage for third-party bodily injury and property damage claims that are caused by you or one of your employees. For instance, if a customer were to claim that you damaged their RV while it was in your care and file a lawsuit against you, this coverage would help to pay for your legal defense fees, as well as any compensation that you may be required to pay out.
- Business Interruption: Should some type of event occur that would shutter your RV dealership for a period of time, business interruption insurance would help you recoup your income losses until you can reopen. For example, if there were a fire in your dealership, business interruption would compensate you for the income you might lose while your business is shut down during repairs.
These policies are just a few examples of the type of RV dealers insurance you'll need to carry as the owner and operator of an RV dealership.
Recreational Vehicle Dealerships' Risks & Exposures
Property exposure is high due to flammable fuels, paints, lubricants, oils, degreasers, and solvents used in the repair operations. These must be properly labeled, separated, and stored away from combustibles. Spray painting should be done in spray booths with good ventilation, UL-approved wiring and fixtures, and adequate controls.
Welding is often a part of the repair and body work operation that needs to be evaluated for proper handling of the tanks and gases. It should be done away from the other operations with either a separate room or flash/welding curtains. Smoking should be prohibited. Poor housekeeping is a serious fire hazard. Unless stored and disposed of properly, oily rags can spontaneously combust and cause a fire.
Work areas must be cleaned regularly and trash removed from the building. Recreational vehicles and their parts are target items for thieves. Appropriate security controls must be taken including physical barriers such as chains, fences, or gates, lighting to deter access to the premises after hours, and an alarm system that reports directly to a central station or the police department.
Business income and extra expense exposures are high as replacement facilities may not be readily available.
Inland marine exposures are from accounts receivable if the dealership offers credit, computers used to monitor inventory and provide diagnostics, floor plan coverage for recreational vehicles furnished by manufacturers and held for sale, goods in transit, signs, and valuable papers and records for manufacturers', parts suppliers' and customers' information. Backup copies of all records, including computer records, should be made and stored off premises.
Vehicles stored in open lots are particularly susceptible to damage by hail, wind, flood, vandalism, and theft. Lots should be well lighted with chains, fences, or gates to prevent access and transport. The more expensive models should be moved inside to the showroom.
An alarm system that reports directly to a central station or the police department should be used. Security guards may be appropriate in some areas.
Crime exposures are from employee dishonesty, forgery or alteration, theft of money and securities, computer fraud, money orders, and counterfeit paper currency. Background checks, including criminal history, should be performed on all employees handling money. Dealers' operations involve a number of transactions and accounts that can be manipulated.
There must be a separation of duties between persons handling deposits, billing, ordering, disbursements, and reconciling bank statements. Physical audits should be conducted at least annually. Theft of money and securities prevention requires controls of monies kept in the cash drawers and regular bank drops.
Auto dealer liability exposure is high due to the number of visitors to the premises. To prevent slips and falls, floor coverings inside the showroom 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. Waiting areas should be provided for customers whose vehicles are being repaired. Customers should not be permitted access to the service area.
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 should be adequate lighting and appropriate security for the area. There should be a disaster plan in place for unexpected emergencies. Vehicles in open lots can pose an attractive nuisance.
Chains and fences should be in place to prevent entrance to the dealership after hours.
Personal injury exposures include allegations of discrimination, false arrest or detention, unauthorized or intrusive searches, or wrongful ejection from the premises.
Repair operations and sales of used vehicles are the major products/completed operations exposures. Compliance with all manufacturers' instructions is critical. There should be a check-off procedure in place prior to the sale or release of vehicles to the customer to prevent its return with any vital functions not working properly.
Commercial auto exposure is high due to employees being provided with demonstrator models and customers who take vehicles for test drives. All employee drivers should have valid licenses with their MVRs regularly checked. All vehicles must be regularly maintained with records retained.
There should be written procedures for personal and permissive use of vehicles furnished to employees. For test drives, there must be set procedures, such as salespersons accompanying the customers. In order to prevent the conversion of the vehicles, driver's licenses and other forms of identification should be verified in advance of the customer removing the vehicle from the premises.
Towing presents a more serious exposure due to the potential for damage to the vehicles towed. All tow truck drivers must be experienced. Towing vehicles must be regularly checked, in particular, the hoists and tow bars.
If the dealership rents recreational vehicles, they should keep a copy of the renters' driver's license and proof of insurance. The rental contract should identify all drivers and state that unlisted, unlicensed, or minor drivers are not permitted to operate the vehicle.
It should also include a hold-harmless agreement in which renters agree to assume responsibility for the operation of the vehicle to limit the business's exposure to vicarious liability only.
If a collision damage waiver is offered, the customer's signature is needed to document whether this was purchased or declined. The customer should also be required to sign a vehicle pre-inspection form to minimize disputes when the vehicle is returned with damages.
Garagekeepers exposure is from damage that can occur to customers' vehicles left with the dealership for servicing or repairs. 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 vehicle to the wrong owner.
Environmental impairment exposures can be significant due to the storage of fuel in underground fuel tanks and the disposal of used oils, solvents and other hazardous wastes from service and repair operations. All tanks and pipes, underground or above, must meet state or federal regulations and be routinely tested for leakage.
Spillage and leaking of pollutants into the air, ground, or water can result in high cleanup costs and fines. Spill procedures must be in place to prevent the accidental discharge of sludge from water reclamation systems used in washing vehicles.
Contracts should be in place to dispose of all environmentally dangerous chemicals. If there are underground storage tanks, a UST policy will be needed.
Workers compensation exposure is moderate from repair and maintenance activities on vehicles. Employees performing maintenance or repair work on customers' vehicles should be properly trained. Employees can incur injuries from slips, falls, back sprains, strains and hernias, hearing impairment from noise, and foreign objects in the eye.
Welders may suffer burns. Repair areas should be properly ventilated. Proper safety equipment is required. Hoists need to be regularly inspected to prevent vehicles from falling off. The proper use of lifting techniques and of dollies should be encouraged. Safety equipment should be provided.
Refueling should be done only in well-ventilated areas to minimize inhaling of fumes. Information regarding chemicals should be available to employees along with early warning signs of problems.
Test drives, pickup, and delivery of customers or vehicles can result in injury due to vehicular accidents.
What Does RV Dealers Insurance Cover & Pay For?
RV dealers can face various types of lawsuits, including:
Breach of Contract: A customer may sue an RV dealer for breach of contract if the dealer fails to fulfill the terms of a sales agreement, such as failing to deliver the vehicle or providing a defective product.
Insurance Coverage: Commercial General Liability (CGL) insurance can provide coverage for RV dealers against claims of breach of contract. The policy can cover legal expenses, settlements, and judgments associated with the lawsuit.
Product Liability: If an RV dealer sells a defective product that causes injury or damage to a customer, the dealer may be held liable for the damages.
Insurance Coverage: CGL insurance can also provide coverage for product liability claims. The policy can cover the legal expenses associated with defending the lawsuit, as well as the damages awarded to the plaintiff.
Fraud or Misrepresentation: An RV dealer may be sued for fraud or misrepresentation if they make false claims or fail to disclose information about a vehicle's condition or history.
Insurance Coverage: CGL insurance may provide coverage for fraud or misrepresentation claims, but it depends on the specific policy language. If the policy excludes coverage for intentional acts, the dealer may need to purchase additional coverage, such as Errors & Omissions (E&O) insurance.
Employee Lawsuits: RV dealers can also face lawsuits from their employees, such as claims of discrimination, harassment, or wrongful termination.
Insurance Coverage: Employment Practices Liability Insurance (EPLI) can provide coverage for these types of lawsuits. The policy can cover legal expenses, settlements, and judgments associated with the lawsuit.
Property Damage: RV dealerships can also face lawsuits if they cause property damage, such as damage to a customer's vehicle or damage to neighboring properties.
Insurance Coverage: CGL insurance can provide coverage for property damage claims. The policy can cover the legal expenses associated with defending the lawsuit, as well as the damages awarded to the plaintiff.
In summary, RV dealers can face various types of lawsuits, but insurance coverage can help protect them from financial losses associated with legal claims. However, it's important to review policy language carefully to ensure that the policy provides adequate coverage for the specific risks faced by the dealership.
Commercial Insurance And Business Industry Classification
- SIC CODE: 5561 Recreational Vehicle Dealers
- NAICS CODE: 441210 Recreational Vehicle Dealers
- Suggested Workers Compensation Code(s): 8380 Automobile - Service or Repair Center & Drivers, 8748 Automobile - Salespersons
Description for 5561: Recreational Vehicle Dealers
Division G: Retail Trade | Major Group 55: Automotive Dealers And Gasoline Service Stations | Industry Group 556: Recreational Vehicle Dealers
5561 Recreational Vehicle Dealers: Establishments primarily engaged in the retail sale of new and used motor homes, recreational trailers, and campers (pickup coaches). Establishments primarily engaged in the retail sale of mobile homes are classified in Industry 5271, and those selling utility trailers are classified in Industry 5599.
- Campers (pickup coaches) for mounting on trucks-retail
- Motor home dealers-retail
- Recreational vehicle dealers-retail
- Recreational vehicle parts and accessories-retail
- Travel trailers, automobile: new and used-retail
RV Dealers Insurance - The Bottom Line
As mentioned, in order to determine exactly what kind of RV dealers insurance coverage you'll need to fully protect your dealership, speak with a reputable broker who specializes in commercial 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
The auto service and repair industry is an essential part of the transportation sector, responsible for maintaining and repairing vehicles to keep them running smoothly and safely. However, this industry also comes with inherent risks and liabilities, which is why commercial insurance is necessary to protect both the business and its employees.
First and foremost, the auto service and repair industry deals with hazardous materials and equipment on a daily basis. There is a risk of accidents and injuries occurring in the workshop, and insurance can provide financial protection in the event of a workplace accident or injury.
Additionally, the auto service and repair industry is subject to the risk of property damage. There is a potential for damage to vehicles in the workshop, as well as damage to the business' own property, such as tools and equipment. Business insurance can cover the costs of repair or replacement in the event of such damage.
Furthermore, the auto service and repair industry is vulnerable to liability claims from customers. If a customer's vehicle is not repaired properly, it can result in further damage or accidents on the road, leading to liability claims against the business. Insurance can provide coverage for these types of claims, protecting the business from financial loss.
In conclusion, the auto service and repair industry needs commercial insurance to protect against the risks and liabilities inherent in this line of work. Without insurance, businesses in this industry would be vulnerable to financial loss and legal action, which could ultimately lead to their failure.
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.