Garage Insurance in Ontario
Insurance for Your Garage or Auto Repair Shop
Automotive businesses face risks that ordinary commercial insurance may not fully cover. Your business may drive, repair, store or otherwise have responsibility for customers’ vehicles while also operating from a garage containing tools, equipment and valuable property.
Humberview Insurance helps Ontario garage owners arrange the combination of garage automobile, liability and property insurance appropriate for their operation
Ontario Garage Insurance Coverage
Garages and other automobile-related businesses commonly require two policies: an Ontario Garage Automobile Policy (OAP 4) for automobile-related exposures and a commercial property and liability policy for the premises, equipment and general business operations. The typical coverages are outlined below.
| OAP 4 – Garage Automobile Policy | What It Covers | Commercial Property and Liability | What It Covers |
|---|---|---|---|
| Automobile Liability | Liability arising from covered automobile operations | Commercial General Liability | Customer injury and property damage claims arising from business operations |
| Accident Benefits | Benefits following an automobile accident, subject to the coverage purchased | Building | The garage building when owned by the business |
| Owned Automobiles and Physical Damage | Eligible vehicles owned by the business, including physical damage when purchased | Contents and Equipment | Tools, lifts, diagnostic equipment and other business property |
| Customer Automobiles and Physical Damage | Certain damage to customers’ vehicles while in the business’s care, custody or control | Stock and Parts | Tires, replacement parts, fluids and other inventory |
| Collision or Upset | Certain physical damage caused by a collision or vehicle upset | Business Interruption | Lost income following insured damage that interrupts operations |
| Comprehensive or Specified Perils | Certain non-collision losses, such as theft, fire or vandalism, depending on the coverage purchased | Equipment Breakdown | Certain sudden mechanical or electrical breakdowns involving covered equipment |
| Service Plates | Policy and coverage details associated with any service plates used by the business | Sewer Backup | Certain damage caused by the backup of a sewer or drain |
Coverage, limits, deductibles and exclusions vary by insurer and policy.
Garage Insurance FAQs
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What insurance does an auto repair shop need in Ontario?
An auto repair shop commonly requires an Ontario Garage Automobile Policy together with commercial general liability, property and business interruption coverage. The exact insurance required depends on the shop’s operations, premises and vehicles.
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Does garage insurance cover customers’ vehicles?
Coverage can be purchased for certain damage to customers’ vehicles while they are in the garage’s care, custody or control. The causes of loss covered, limits and deductibles depend on the policy selected.
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Are my tools and equipment covered?
Tools and equipment can be insured under commercial property coverage. Your broker will need to know their replacement value and whether they are used only at the garage or taken to other locations.
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Does garage insurance cover faulty repairs?
Garage insurance may respond to certain liability claims arising from completed work, but it generally does not simply pay to redo defective workmanship. Coverage depends on the circumstances and policy wording.
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Are employees covered while test-driving customers’ vehicles?
Authorized employees may be covered while driving a customer’s vehicle for garage operations, subject to the policy terms. Insurers commonly require driver information and may restrict or exclude certain drivers.
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Do mobile mechanics need garage insurance?
A mobile mechanic may require garage automobile liability, commercial general liability, tools coverage and insurance for business-owned vehicles. The insurer must know that work is performed away from a fixed garage.
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Does a garage policy cover vehicles owned by the business?
Eligible business-owned vehicles may be insured under the garage automobile policy when properly disclosed and listed. Do not assume that every vehicle owned by the business is automatically covered.
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Can auto body shops obtain garage insurance?
Yes, although spray painting, welding, vehicle values, fire protection and paint-booth systems may require additional underwriting information.
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Is garage insurance mandatory in Ontario?
There is no single insurance policy universally required for every garage. However, Ontario automobile insurance requirements apply when vehicles are owned or operated, while landlords, lenders, franchisors and municipalities may require specific coverage or proof of insurance.
