Used & Independent
Car Dealer Insurance
Independent and used car dealers have unique insurance needs that most agencies don't understand. We specialize in garage liability, dealers open lot, and surety bonds for independent dealers — all 50 states, same-day certificates, and rates that reflect your actual risk.
General Liability Won't Cover You
The single most common insurance mistake independent dealers make is carrying a standard general liability policy instead of garage liability. Standard GL policies contain an "auto exclusion" — a clause that eliminates coverage for bodily injury or property damage involving automobiles. For a used car dealer, nearly every liability exposure involves a vehicle.
A customer injured during a test drive. A vehicle damaged while being moved on your lot. A car stolen from your inventory. A buyer's vehicle damaged by your service tech. All of these claims would be denied under a standard general liability policy.
Garage liability insurance is specifically designed for automotive businesses and covers these exposures. It is the required and appropriate coverage for any licensed dealer — and most state DMVs specifically require it as a condition of your dealer license.
Coverage Comparison
| Scenario | Gen. Liability | Garage Liability |
|---|---|---|
| Customer injured on test drive | ✗ Excluded | ✓ Covered |
| Inventory theft from lot | ✗ Excluded | ✓ With DOL |
| Hail damage to inventory | ✗ Excluded | ✓ With DOL |
| Customer vehicle damaged in service | ✗ Excluded | ✓ With GK |
| Slip & fall in showroom | ✓ Covered | ✓ Covered |
| Property damage to building | ✓ Covered | ✓ Covered |
What Independent Dealers Need
Garage Liability
The core liability policy for used car dealers — covers bodily injury and property damage from your dealership operations, including test drives, customer visits, and service work. Standard general liability excludes most vehicle-related claims.
Dealers Open Lot (DOL)
Physical damage coverage for your vehicle inventory against fire, theft, vandalism, hail, flood, and other covered perils. Without DOL, a single hailstorm or theft event could wipe out your entire inventory investment.
Garagekeepers Legal Liability
Covers customer vehicles in your care, custody, or control — while being serviced, detailed, or stored. Essential if you take in vehicles for service or hold trades overnight.
Dealer Surety Bond
Required by every state DMV to obtain and maintain a dealer license. Protects consumers against dealer fraud or failure to deliver title. Bond amounts range from $10,000 to $100,000 depending on your state.
Commercial Auto
Covers dealer plates, loaner vehicles, and vehicles used in your business operations. Dealer plate coverage is critical — without it, accidents on dealer plates may not be covered.
Workers' Compensation
Required in most states for businesses with employees. Covers medical expenses and lost wages for employees injured on the job. Penalties for non-compliance can be severe.
How Much Does It Cost?
Premiums vary based on inventory value, location, employees, and claims history. The ranges below are typical for independent dealers with clean loss histories. Contact us for a customized quote.
| Dealer Type | Garage Liability | Dealers Open Lot | Surety Bond | Total Program |
|---|---|---|---|---|
| Small used car lot (under 25 units) | $1,500–$2,800/yr | $800–$1,800/yr | $200–$500/yr | $2,500–$5,100/yr |
| Mid-size used car dealer (25–75 units) | $2,800–$5,500/yr | $1,800–$3,500/yr | $300–$700/yr | $4,900–$9,700/yr |
| Large independent dealer (75–200 units) | $5,500–$10,000/yr | $3,500–$7,000/yr | $500–$1,200/yr | $9,500–$18,200/yr |
| Buy-here pay-here dealer | $3,000–$7,000/yr | $1,500–$4,000/yr | $300–$800/yr | $4,800–$11,800/yr |
* Estimates only. Actual premiums depend on location, inventory value, employees, and loss history. Contact us for an accurate quote.
Dealer License Requirements by State
Every state requires dealers to carry liability insurance and a surety bond as conditions of their dealer license. Requirements vary — here are the states where we are licensed and active.
| State | Min. Liability | Surety Bond | Licensing Body |
|---|---|---|---|
| Florida | $25,000 CSL | $25,000 | FLHSMV |
| Texas | $30,000/$60,000 BI, $25,000 PD | $50,000 | TxDMV |
| Georgia | $50,000/$100,000 BI, $25,000 PD | $35,000 | GA SOS |
| North Carolina | $30,000/$60,000 BI, $25,000 PD | $50,000 | NCDMV |
| South Carolina | $25,000/$50,000 BI, $25,000 PD | $50,000 | SCDMV |
| Oklahoma | $25,000 single liability | $25,000 | OMVC |
| New Mexico | $50,000 CSL | $50,000 | NM MVD |
| Utah | $90,000 CSL | $75,000 | Utah MVED |
* Requirements change. Always verify current requirements with your state DMV or licensing authority before applying for a dealer license.
Used Dealer Insurance FAQ
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Dealer Insurance?
We specialize in independent and used car dealers. Same-day coverage, competitive rates, and an agent who understands your business.
Licensed independent agency. Coverage available in all states we serve.