Auto Repair Shop Insurance · Mechanics

Auto repair shop and mechanic insurance for the cars in your bays.

Garage liability, garagekeepers, property, tools and workers’ comp for mechanic shops, performance and custom shops, body shops, tire shops and mobile mechanics, in California and every other state.

Quick answer An auto repair shop typically needs garage liability, garagekeepers coverage for customers' cars, property and tools coverage, and workers' comp once it has employees, plus anything its lease or lender requires.

Garagekeepers coverage pays for damage to a customer's car while it is in the shop, on a lift or on a test drive, which a regular liability policy won't pay for.
Garage liability covers injuries and damage tied to an auto repair shop's premises and repair work.
California Labor Code 3700 requires every employer to secure workers' comp, so an auto repair shop's first technician on payroll triggers the requirement.
California's Bureau of Automotive Repair registration has no proof-of-insurance or bond requirement; leases, lenders and customers leaving cars are what require garagekeepers coverage.
An auto repair shop with oil, solvent and refrigerant on site should have pollution coverage quoted separately, because the garage form excludes pollution.

By Sam Alishahi · CA Insurance License #4348151 · Reviewed October 2026 · En español · How this page is researched

Get a Quote Call (424) 552-4545

How it works

Customers' cars are your biggest exposure

When a customer's car is damaged while it's in your shop, on a lift or on a test drive, a regular liability policy won't pay for it. Garagekeepers coverage does, and garage liability covers the claims tied to your repair work and premises.

California auto repair dealers register with the Bureau of Automotive Repair, and landlords and lenders set their own insurance requirements. I put together the pieces for how your shop actually operates.

Garage liabilityInjuries and damage tied to your premises and repair work.
GaragekeepersCustomers' vehicles in your care, custody and control.
Property and toolsBuilding, lifts, diagnostic equipment and tools.
Workers' compRequired in California for employees.

What I help with

Shop situations I'm called for

Customer car damaged in the shop

Garagekeepers coverage with the right limit.

Body and paint work

Carriers that accept paint booths and body work.

Performance and custom shops

Carriers that accept engine builds, tuning, dyno time and track-prep work, with garagekeepers that follows the car.

Test drives and pickups

Coverage for driving customers' cars.

Tow truck for the shop

Tow truck coverage. See details

Hiring technicians

Workers' comp with the right class code. See details

Expensive diagnostic tools

Tools and equipment coverage. See details

Before you call

What underwriters will ask

Having these ready means I can go to market on the first call. The quote form asks for the same things, and anything you don’t know yet can wait.

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Shop: repair, body, tire, transmission or mobile.
Location: address, square footage and lease requirements.
Customer cars: maximum value on site at once.
Staff: technicians and payroll.
Revenue: annual receipts.
History: current policies and loss runs.

Who needs auto repair shop insurance, and what the law actually requires

BAR registration does not ask for insurance. California's Bureau of Automotive Repair requires registration to "diagnose, service, or repair vehicles for compensation," including mobile, referral and sublet work; exempt are non-passenger-only shops, fleet owners fixing their own fleet, and parts-only machine shops. The application asks for a Social Security number or ITIN, photo ID, FEIN, seller's permit and environmental permits; no proof of insurance or bond.

What the law requires sits elsewhere. Labor Code 3700 says "every employer except the state shall secure the payment of compensation," through an authorized insurer or a certificate of consent to self-insure, so the first technician on payroll triggers workers' comp; the threshold varies by state. Vehicles the shop owns, including a shop tow truck, are owned autos, symbol 22, on commercial auto or the garage form. The garage form's leased-autos exclusion, number 7, carves out "a covered auto you rent to one of your customers while their auto is left with you for service or repair," so declare loaners.

Everything else is contract: the lease that sets limits and adds the landlord as additional insured, the lender that wants equipment scheduled, the customer who assumes garagekeepers exists. Full list: what insurance an auto repair shop needs.

Garagekeepers: the three boxes on the form, and which one your customers assume you bought

ISO writes garagekeepers as Section III of the garage form or as endorsement CA 99 37 on a business auto policy; the grant is the same: "all sums the insured legally must pay as damages for loss to a customer's auto" left in your care while you are "attending, servicing, repairing, parking or storing it." Customers include your employees and their households when they pay for the work. Three schedule choices decide what that is worth.

Cause of loss. Comprehensive is any cause except collision with another object or overturn. Specified Causes of Loss is only fire, lightning or explosion, theft, and mischief or vandalism. Collision is those two. Specified Causes alone has nothing for the car dropped off a lift or hit on a test drive.
Legal liability or direct. The base grant is legal liability only. The Excess box adds coverage "without regard to your or any other insured's legal liability," excess over any other collectible insurance; the Primary box pays first, fault or not. Customers assume Primary. The box shows on the schedule or declarations, not a certificate.
Limit and deductible. The limit is per loss at each location, the deductible per customer's auto, and a scheduled maximum deductible caps all theft, mischief or vandalism loss in one event, so a twelve-car lot break-in is not twelve deductibles.

Both exclude theft or conversion by you, your employees or shareholders, defective parts, and faulty work you performed. More at what garagekeepers insurance is.

Why a plain general liability policy leaves the cars out: symbols 21 to 31 and CG 22 68

The ISO garage form, CA 00 05, is auto and premises liability in one policy; the declarations symbols set which cars it covers: 21 any auto; 22 owned autos; 28 hired autos; 29 non-owned autos used in your garage business, including employees' and partners' own cars; 30 "any customer's land motor vehicle or trailer or semitrailer while left with you for service, repair, storage or safekeeping"; 31 dealers' autos. A parts runner's own car is a 29, a test drive a 30; a liability line with 22 alone leaves both out.

Exclusion 6 removes property damage to "property in the insured's care, custody or control," the hole garagekeepers fills. Exclusion 13 removes damage to work you performed that "results from any part of the work itself or from the parts, materials or equipment used," the language behind the faulty-repair answer above.

A standard general liability policy instead excludes any auto "owned or operated by or rented or loaned to any insured," and a test drive is an auto operated by you. ISO's fix is CG 22 68, Operation of Customers' Autos on Particular Premises, required on the CGL for repair or service stations, car washes, gasoline stations, tire dealers and quick lubes; it restores liability for customers' autos "on or next to the premises" while with you for servicing, never for autos owned by, rented to or loaned to you, and damage to the car itself still needs garagekeepers. On a GL or BOP quote, ask which form restores customers' autos and which carries garagekeepers.

What moves an auto repair shop quote: class codes, payroll splits and the performance-shop questions

Workers' comp is classified by what the shop does, not what the sign says. In California, WCIRB 8389, Automobile or Truck Repair Facilities, covers mechanical work (engines, brakes, suspension, exhaust, electrical, A/C, tune-ups, glass) and includes estimators, service writers and cashiers. It stops at retail gasoline sales, tire sales over 10% of gross receipts, or transmission work over 50%, which is 8397; towing non-owned vehicles is 7227. Body and paint has its own class and page.

WCIRB 8390, Automobile, Truck or Van Conversion or Customizing, applies to "a combination of mechanical, chassis, body, paint, upholstery and accessory installation work"; a single customizing activity goes to that activity's class. The garage form's racing exclusion, number 10, removes covered autos used in, practicing for or "being prepared for" organized racing or stunting, so the garage underwriter asks about dyno time, track-day support, nitrous or forced-induction installs, and who drives the cars. Answer up front and the shop is judged on its work, not its class code.

Payroll splits count only with time records. The WCIRB rule says payroll "may not be divided by means of percentages, averages, estimates, or any basis other than specific time records"; without them the whole wage goes to the highest-rated class. Outside California, ask your state's bureau before splitting anyone. Bring payroll by class and receipts split by tires, transmission and fuel.

Lifts, used oil and permits: the rules underwriters and inspectors check

Lifts. Cal/OSHA's Title 8, section 3542, requires lifts made after July 28, 2005 to be installed per the manufacturer and built and tested to ANSI/ALI ALCTV-1998, and says "the operation, inspection and maintenance of automotive lifts shall be performed by a qualified person" following the manufacturer's procedures, citing ANSI/ALI ALOIM-2000. Rules vary by state; the lift inspection log is the first loss-control document I am asked for.
Used oil. Under EPA's used oil rules, 40 CFR part 279, a generator is any business handling used oil "from the maintenance of vehicles and equipment." Label every container and tank "Used Oil," keep them leak-free, store them away from solvents and chemicals ("don't mix used oil with anything"; contaminated oil can become hazardous waste), and stop, contain and clean spills at once. The garage form excludes pollution from premises and covered autos alike, exclusions 8 and 9, so a shop with oil, solvent and refrigerant on site should have pollution coverage quoted separately.
Permits. The hazardous waste facility permit and air district spray booth permit are on BAR's registration checklist; the underwriter asks for the same paperwork, and other states' agencies issue their own.

Questions

Auto repair shop insurance, answered

What is garagekeepers insurance?

It covers damage to customers' vehicles while they're in your care, such as fire, theft, vandalism or collision during a test drive, depending on the options chosen.

What's the difference between garage liability and garagekeepers?

Garage liability covers claims by others for injuries and damage from your operations. Garagekeepers covers the customers' cars themselves while you have them.

Does a mobile mechanic need garage insurance?

Mobile mechanics need liability for their work and coverage for customers' vehicles they work on, though the policy is set up differently than for a fixed shop.

Are faulty repairs covered?

Liability can cover damage or injury caused by a faulty repair, but usually not the cost of redoing the work itself.

Is garagekeepers insurance required by law in California?

BAR's automotive repair dealer application has no proof-of-insurance or bond line. Leases, lenders and the customers who leave cars with you are what require it.

What workers' comp class code is an auto repair shop in California?

Mechanical repair without retail gasoline sales is WCIRB 8389; combined mechanical, body, paint, upholstery and accessory customizing is 8390; mostly transmission work is 8397.

Do you offer auto repair shop insurance outside California?

Yes. Clients across the country send the same quote form. California policies are placed directly; outside California the request is handled together with a partner agency in your state, and the shopping across carriers works the same way. Rules, minimums and markets differ by state — see insurance requirements by state.

Official sources

Often placed alongside this

Coverage

Tow truck insurance

Liability, on-hook and garagekeepers coverage for towing companies.

See coverage Coverage

Auto body shop insurance

Garage liability, garagekeepers and property for collision and paint shops.

See coverage Coverage

Auto dealer insurance

Garage liability, dealer's open lot and bonds for used car and truck dealers.

See coverage

Questions people ask: What is garagekeepers insurance? What insurance does an auto repair shop need? Can I choose my own auto repair shop in California?

Also covered with this: Mobile mechanic insurance Car wash insurance Valet parking insurance Garage liability insurance

By state: Insurance requirements by state

Auto repair shop insurance

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Alishahi Insurance · Saman Alishahi, independent insurance broker, California License #4348151. General information, not a quote or a promise of coverage; coverage depends on underwriting and the terms, conditions and exclusions of the policy actually issued.

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