Alabama Property and Casualty Practice Exam

A car wash concerned about its responsibility for customers' cars should buy which of the following?

1. Garage Endorsement to Business Auto

2. General Liability Coverage

3. Commercial Auto Liability

4. Workers Compensation Coverage

The correct answer is: Garage Endorsement to Business Auto

The best choice for a car wash worried about its responsibility for customers' cars is to purchase a Garage Endorsement to Business Auto coverage. This form of insurance is specifically designed to cover the liability risks associated with servicing vehicles owned by customers. When a customer leaves their car at a car wash, the business assumes a degree of responsibility for that vehicle while it is in their custody. The Garage Endorsement provides coverage for physical damage to the customers' cars that occur while they are being washed, detailed, or serviced at the facility. This endorsement effectively extends the general liability policy to include protections specifically for customer vehicles, addressing the unique risks faced by businesses in the automotive service industry. While general liability coverage offers protection against general business risks, it does not typically cover damages to customer property. Commercial auto liability is related to vehicles owned by the business itself, not customer vehicles. Workers compensation coverage is essential for protecting against employee injuries but doesn’t safeguard customer property. Thus, the Garage Endorsement is the most suitable option for addressing the specific liability concerns of a car wash.