Auto Shop Insurance
Protect Your Garage, Tools, Team, and Customers with the Right Insurance Coverage
Auto Shop Insurance in Ontario
Protect Your Garage, Tools, Team, and Customers with the Right Insurance Coverage
What Is Auto Shop Insurance?
Auto shop insurance is a customized commercial insurance package designed for automotive businesses—including mechanic shops, tire and wheel centers, auto body repair shops, detailing services, and custom performance garages.
It protects your business from the most common and costly risks you face daily: property damage, customer vehicle damage, employee injuries, theft, fire, and liability claims.
If you operate any type of auto repair or maintenance business, the right insurance isn’t just a smart investment—it’s essential for long-term survival.
Who Needs Auto Shop Insurance?
If you run any business that services, stores, or repairs vehicles, you need insurance that protects your tools, customer vehicles, and liability exposure.
This includes:
General mechanic shops
Tire & wheel shops
Transmission specialists
Auto body & collision repair centers
Custom car and performance garages
Oil change & lube shops
Car detailing businesses
Mobile mechanics
Auto glass repair shops
Whether you own a single location or manage multiple garages, auto shop insurance is designed to protect your operations from financial loss.
What Does Auto Shop Insurance Cover?
1. Garage Liability Insurance
This covers bodily injury and property damage claims that occur on your premises or as a result of your work.
Example: A customer trips over an air hose in your shop and sues for medical expenses. Garage liability pays for legal defense and damages.
2. Garagekeepers Insurance (Customer Vehicle Protection)
When you take custody of a customer’s vehicle, you’re responsible for it. Garagekeepers insurance covers damage to customers’ vehicles while in your care, custody, or control—whether from fire, theft, vandalism, or accidents.
Example: A car you’re storing overnight is damaged in a fire. Garagekeepers insurance covers the repair or replacement cost.
3. Commercial Property Insurance
Protects your building, shop equipment, diagnostic tools, lifts, compressors, computers, and inventory from fire, theft, vandalism, and weather events.
Example: A break-in results in stolen tools and damaged property. This coverage helps you recover fast and resume operations.
4. Commercial General Liability Insurance (CGL)
CGL covers third-party slip-and-fall injuries, property damage, and claims like defamation or false advertising. This is often required by landlords, vendors, and commercial leases.
5. Tools & Equipment Insurance
Many policies cap tool coverage—but not all tools are created equal. Tools and equipment coverage ensures your high-value gear is protected even off-site or in transit.
6. Business Interruption Insurance
Covers lost income if your shop must temporarily close due to a covered event (fire, flood, etc.). This helps pay for ongoing expenses like rent, payroll, and utilities during downtime.
7. Commercial Auto Insurance
If you use a company vehicle for parts runs, customer pickups, or mobile services, you’ll need commercial auto coverage that protects you beyond what personal policies allow.
Common Risks Faced by Auto Shops
Auto repair shops face a unique mix of physical, legal, and reputational risks. Without the right coverage, a single incident can lead to serious financial damage.
Some of the most common risks include:
A mechanic accidentally damages a customer’s engine
A client’s car is stolen while in the garage overnight
A fire destroys expensive diagnostic equipment
A customer slips on an oil spill and sues
An employee is injured while lifting a vehicle
A cyberattack compromises your booking and billing software
Is Auto Shop Insurance Required in Ontario?
Certain coverages, like commercial auto, are required if you have employees or company vehicles.
Others—like garage liability, property, or customer vehicle coverage—aren’t legally mandated but are often required by landlords, vendors, and regulatory bodies, and are strongly recommended for financial protection.
In many provinces, you may also need insurance proof to operate under certain Automotive Repair Facility licenses or certifications.
How Much Does Auto Shop Insurance Cost?
Pricing depends on:
The size of your garage and annual revenue
Services offered (e.g. engine rebuilds vs. tire swaps)
Number of employees
Value of your tools and property
Claims history
Location and neighborhood risk profile
Number of customer vehicles stored at any time
Why Choose SIG.ca for Auto Shop Insurance?
We understand the commercial insurance needs for mechanics, auto shops, and related automotive businesses.
Access to multiple top-tier Canadian insurers
Fast, personalized quotes tailored to your shop
Guidance on required vs. optional coverages
Support through claims, renewals, and scaling
From a single bay to a high-volume garage, we help you protect your business, your team, and your customers.
Frequently Asked Questions
Yes. Standard liability policies don’t cover vehicles in your care. Garagekeepers coverage is essential.
Yes—if you have garage liability and garagekeepers coverage, most service-related damage and test drive incidents are covered.
To a point, yes—but high-value tools should be itemized and may require separate tools & equipment coverage for full protection.
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