How Much Is Car Dealership Business Insurance Today?
- Nate Jones, CPCU, ARM, CLCS, AU
- 3 days ago
- 2 min read
If you’re a new or used dealership owner, one of the first questions you’ll ask is: How much is car dealership business insurance today? The truth is, the cost varies widely depending on your inventory, location, operations, and claims history. Dealerships carry unique risks, from test drives to high‑value inventory, which means insurance pricing is highly customised.
Below is a clear breakdown of what dealerships can expect and the factors that influence cost.
1. Typical Cost Range for Car Dealership Insurance
While exact numbers vary, most dealerships can expect:
Garage Liability: $2,500–$12,000 per year
Dealer’s Open Lot (DOL): Highly dependent on inventory value
Garage keepers: $1,500–$6,000 per year
Workers’ Compensation: Based on payroll and employee roles
Smaller used dealerships tend to fall on the lower end of the range, while large franchise dealerships or those with heavy inventory can pay significantly more.
Industry sources such as the Insurance Information Institute offer general insight into how businesses are rated, though dealership pricing is more specialised.
2. Your Inventory Value Drives Most of the Cost
Dealer’s Open Lot coverage typically represents the largest portion of your total premium. Carriers look at:
Average monthly inventory
Maximum inventory
High‑value vehicle exposure
More vehicles = more risk = higher premium.
3. Location and Crime Score
Insurance companies evaluate ZIP codes for:
Theft rates
Vandalism frequency
Weather severity (hail, wind, flood)
Dealerships in high‑crime or storm‑heavy areas often pay higher premiums.
4. Your Dealership’s Claims History
A clean loss record can significantly reduce premiums. Carriers will request 3–5 years of loss runs before issuing a car dealership business insurance quote.
Common claims that increase pricing include:
Test drive accidents
Vehicle theft
Lot damage from storms
Customer vehicle damage
5. Security and Safety Measures
Dealerships with strong security often earn lower rates. Carriers consider:
Fencing and gates
24/7 video surveillance
Lighting
Alarm systems
Key control procedures
These measures reduce risk and may qualify you for discounts.
Get the Best Pricing for Your Car Dealership Business Insurance
Not all insurance carriers write dealership coverage, and your premium will vary depending on inventory value, security, location, employee exposure, and claims history. Wexford Insurance partners with top carriers that specialise in car dealership insurance, helping owners secure the best limits, deductibles, and policy structure for the right price.
👉 Request your car dealership business insurance quote from Wexford Insurance today and make sure your dealership, and every vehicle on your lot, is fully protected.
