Not long ago, I received an email from a gentleman who wanted to set up a mobile oil change business in Florida. He was concerned about what type of insurance he might need and he was under the impression that a $1 million commercial liability policy was needed on top of his commercial auto policy for work truck vehicles. Okay, so, let’s talk about this; you’re right?
As it turns out, it definitely is, you’ll see that a business car is not the same as operations completed or potential liability while you work. For example, if a car you are working on catches on fire, your commercial auto policy will not cover it. Do you see that point? So, this is the advice that I explained to you;
You will most likely want to get a business insurance policy; A total of $1 million, 300,000 per general liability incident, with a “garage attendant liability” notation, and there will be some customer who can demand more, and also demand additional insurance, not just a registered certificate of insurance.
Commercial auto insurance is another necessity, but most commercial business policies will write them together as one. Find a good “commercial insurance broker” and ask them to explore their sources, usually the broker-agent knows the underwriters very well (as on speed dial) and can get you a good rate and the underwriter will understand the difference between mobile and fixed costs. Generally, commercial liability insurance is based in part on your estimated gross income.
Don’t overestimate or you’ll pay too much, and don’t underestimate or you may be audited by the insurance company or they may just decide you’re not a viable risk. Believe it or not, most commercial insurance policies have a clause in their insurance contracts that they can audit you, and by signing the policy, you agree to those audits in advance. Therefore, it is not prudent to falsify information or underestimate it. If you find that you may have underestimated, you should call your broker-dealer and explain that sometimes they will increase the premium and sometimes they will increase next year’s gross sales estimates.
Now Florida is a huge market for mobile oil changes however let’s not forget there is some competition there some over 25 years in fact so insurance is just one aspect or information one should consider . before starting a business of this type. Consider all this and think about it, and develop a solid business plan.
