Whenever you budget the expenses of your business, Auto parts sales insurance must be high on the list because you can’t always know exactly what can happen in the future.
Need General Liability Insurance for Your Auto Parts Sales
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With the protection provided by insurance against accidents and all the other kinds of insurance we will tell you about, you can protect your business and yourself in case something unforeseen happens.
Like any business owner, for your Auto parts sales enterprise, you must consider how much financial danger you are taking on.
If your Auto parts sales business runs without proper insurance, you are taking a giant chance not just of losing some money but of a total wipe-out.
This is because the laws in every state are very strict in enforcing liability on the owners of businesses for the upshots of their actions.
In this article, we are giving very general guidelines for growing businesses to outline what the main kinds of insurance that you need are, and where we can, a rough guide to how much you can expect to pay.
The question is, can you afford to NOT have insurance for your Auto parts sales business?
What this means, for any Auto parts sales business owner, is that if some customer claims that your work caused them some physical or economic damage, a court can award damages far beyond the total size of your business.
Your Auto parts sales business is not harbored by laws in the same way as states are, where edicts can place a “cap” on the maximum level of liability.
In some states, like Montana, there are specific monetary levels that limit the amount a judge can award in any case against the state.
In a court case, it’s purely the duty of the jury to award whatever amount they deem appropriate, even sometimes giving a plaintiff more than they have sued for.
When you are running your Auto parts sales operations, you can’t deny responsibility for the results of your actions.
Even more importantly, unless you have spent up-front the money necessary to have your business running as an LLC, all of that liability belongs to you as a person.
What does Auto parts sales insurance protect you from?
For your Auto parts sales business, the most important kinds of insurance are designed to cover the risks to your business from accidents, from unexpected events, and from mistakes.
In addition there are some official kinds of insurance that various states require.
In the next few paragraphs, we will explain the most important points any Auto parts sales business owner should know when negotiating the insurance needed.
The main categories of insurance for your Auto parts sales businesses are liability insurance, commercial insurance, asset insurance and workers compensation insurance.
General liability insurance
Any Auto parts sales business is dealing directly with customers, and that means you always have the danger that some accident can happen to them themselves or else something of theirs can be spoiled.
In such a case, they can sue you for compensation.
General liability insurance policy for your Auto parts sales business covers you against claims coming from injury to customers or damage to their property.
It protects your Auto parts sales business from the claims themselves and also to any resulting court costs and legal fees of the lawsuits.
In many cases, it should help you to qualify for extra business from city and state organizations, where contracts require proper liability insurance.
The normal level of general liability insurance for your Auto parts sales business would be with a cap of $1 million for a single submission and a total of $2 million for the whole year.
See the table in the costing section below for average prices of general liability insurance for your Auto parts sales insurance operations.
Professional liability insurance for your Auto parts sales business
In the event where a customer alleges some negligence, errors, or omissions in how you conducted your Auto parts sales business for them, you can quickly be involved in a court case.
Even if the case against you is judged in your favor, the cost of defense can be high, and the impact on your reputation can be damaging.
Almost all small Auto parts sales business should have enough professional liability insurance to cover an individual claim of $25,000, with annual cover of $50,000.
See the table in the cost of Auto parts sales insurance section below for average prices of professional liability insurance for your Auto parts sales operations.
Product liability insurance
Whatever goods you sell or advice you give about the goods, you are running a risk that clients may claim that the results didn’t meet your description of function, or that your recommendation was basically incorrect.
You need to know the specific laws of product liability in your own state.
For example, in California, all businesses in the supply chain can be held responsible for damages caused by products claimed to be defective.
To cover yourself against any following lawsuit, you need Product liability insurance for Auto parts sales
Only you can determine exactly how much insurance you need.
Best advice is to contact experienced insurance agents, brokers or company representatives for support.
Commercial vehicle insurance for your Auto parts sales business
Take care! – almost all policies for private vehicle insurance do not cover any happening like theft or accidental damage when the van is being used for business purposes.
The right way to make sure that your vehicle is insured for both its own value, and the valuable contents, is by taking out a proper commercial vehicle insurance package.
Commercial car policies insure the value of any vehicle in case of accident, malicious damage, fire, or theft.
In addition, in case of any accident, the truck itself, the content and any legal bills, medical expenses, and property damage is insured if your car is involved in a crash.
Most states, other than Virginia and New Hampshire, mandate this type of insurance.
The necessary value of the insurance is calculated on the depreciated value of the vehicle, and your requested level of cover of contents.
Tools and Equipment insurance
Since your Auto parts sales business needs specific and expensive equipment, you will realize how much it can cost to replace it in case of any damage, loss, or theft.
The tools may be subject to malicious damage, deliberate fire, theft, other such unpredicted acts.
In addition, acts of nature like lightning strikes, hurricanes, earthquakes, and other highly damaging natural events can wipe-out your whole business in one stroke.
Unless you can afford to immediately replace such specific gear quickly out of your own pocket, you need full-level equipment insurance so that you can immediately buy everything needed to keep your Auto parts sales business running.
It is impossible to advise how much equipment insurance you need – it’s really dependent on how much you have invested in your Auto parts sales business’ equipment.
Commercial Property insurance
Any Auto parts sales business that owns or rents space in a building should have a commercial property insurance policy.
If you own the space, you may already have a substantial capital investment, in addition to a big liability if there’s a mortgage.
Every physical building location must carry insurance coverage for the value of the premises and contents against natural occurrences like fire and storms, and against man-made damages like theft and vandalism.
In other states like Washington, where extreme cold snaps can cause damage to outer coverings of Auto parts sales business premises, there is a need for more extra cover than in warmer climes.
Because the level of cover depends entirely on the value of the property, it’s not possible to say what cover your need, but we have been able in the table in the cost of Auto parts sales insurance section below to give some estimate of the average prices per million dollars of property insurance for your Auto parts sales business.
Temporary insurance by month, week or day for your Auto parts sales business
Is your Auto parts sales business working part-time or casually, or is the level of business variable?
Using short-term insurance makes excellent sense. Business insurance by the month, day, or week – temporary insurance for Auto parts sales – are special policies where you can cover a nominated period when you want to be covered.
By only paying for that period of cover, you will save by having less premiums but still having adequate risk cover.
The key feature of short-term insurance is that you purchase the cover for a defined period – a specific date, or a week or month starting on a specific date, for example for 30 days beginning on the specified date.
When you are expecting periods of better business activity, get the existing cover raised.
Talk to your insurance agent, broker or the company’s representatives to see what options you have.
Business Owners Policy BOP for your Auto parts sales business
You have the option to combine a few of the important kinds of small business insurance in one policy that is known as the business owner’s policy – BOP.
A BOP merges commercial property and public liability insurance by incorporating these coverages into one insurance policy, which can save you money.
BOP insurance will shield you if any claims of injury or property damage are made.
It is mostly the right choice for small and medium-sized Auto parts sales businesses, such as yours.
There are a few limits that will dictate whether BOP is suitable for your own business.
BOPs will not cover your professional liability or commercial vehicle cover.
Also, the size of your business will determine whether you are allowed to take out BOP cover.
The normal business that is eligible for a BOP policy must have less than one hundred employees, and not more than five million dollars in annual turnover.
Plus, you must separately take out the necessary worker’s compensation, health and disability insurance as determined for your state.
Workers Compensation insurance for your Auto parts sales business employees
In most states, it is mandatory to have workers compensation insurance when your Auto parts sales business has one or more employees.
Workers compensation insurance covers the enterprise against any costs that arise if any hired hand experiences an injury or becomes sick as a result of work.
The benefits provide for medical expenses, death benefits, lost wages, and vocational rehabilitation.
Failure to meet a state’s regulations in this regard can leave you as the employer required to pay penalties levied by the states.
In these states, you can’t get your workers compensation obligations from private insurance providers.
Workers compensation charges are computed based on the employee’s pay, and usually come out at around $1.00 per $100 per month.
However, you must see the relevant authorities in your state.
Average costs of these types of insurance
Although every Auto parts sales insurance need is unique, there are enough examples of standard quotes from insurance companies for us to give approximate guidelines, including what are the cheapest rates offered.
Of course, you should always check with a broker what’s relevant for your business.
The list below is of annual premiums we have gathered for the main types of insurance your Auto parts sales businesses needs.
|Types of insurance||Price range|
|Commercial insurance||$1085 – $2535|
|Equipment insurance||$371 – $1453|
|Product liability insurance||$212 – $670|
|Commercial vehicle insurance||$1645 – $2531|
|General liability insurance||$696 – $1292|
|Public liability insurance||$315 – $757|
Cost of insurance for your Auto parts sales operations depends on many different factors.
We have reckoned these figures for small freelance Auto parts sales businesses.
The location and size and type of your Auto parts sales business can have a big effect on the cost of different policies.
You should consult with professional insurance agents and brokers, or insurance company representatives.
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Also you can let the internet do the work for you by looking for insurance companies near where your business is located.
Another reliable source of information is the local Better Business Bureau in your city.
What is small business insurance for Auto parts sales operations?
This is a general term used to describe basic insurance policies designed to protect Auto parts sales business owners from risks like bodily injury, property damage, claims of negligence.
Does my Auto parts sales business have to have insurance?
Some of the kinds of insurance are not mandatory for you to operate your business, but they can protect you from risks in your business operations.
Several other forms are required by state law, such as workers compensation and vehicle insurance.
What does a small Auto parts sales business insurance policy cover?
Liability insurance provides insurance against lawsuits or claims filed by a third-party for bodily injury, property damage, or negligence.
The exact cover will vary based on your own operations.
See the table in the costing section above for average prices of the recommended policies for Auto parts sales insurance.
How much will Auto parts sales business insurance cost?
On top of the size of the business, some other factors, such as location and claims history, are used to determine your policy’s cost.
You should talk to professional insurance agents and brokers, or insurance company representatives.