What is the liability risk of a simple tire swap?

Published On: November 14th, 2019Categories: Commercial Insurance

Another liability insurance article?  Yes, this is an important read about a basic tire swap. It is important to consider what it may be like for you and your business when you don’t have proper liability limits on your insurance.

THIS STORY BEGINS LIKE EVERY OTHER ROUTINE TIRE AND BRAKE INSPECTION…

  • Garage takes possession of a customer’s car and brings it into the shop.
  • Pulls off the tires and inspects both the tires and brakes.
  • All seems in good order.
  • Throw a lube, oil, and filter, and the customer goes in his car.
  • Simple tire swap complete.

As you noticed, nothing out of the ordinary about this story so far.

YOUR CUSTOMER PICKS UP THEIR CAR, THANKS YOUR TEAM, AND DRIVES OFF…

The customer picks up the car, thanking you for your quick tire swap turnaround, and drives the short distance home without incident. The next day he jumps in the car and gets on a small highway on his commute to work. Now driving at speeds greater than 90 kilometers per hour is where the story will change from ordinary to scary. He hears a noise. The car shakes, and the front passenger wheel comes off.   In traffic, the car slams down on its rotor as the wheel crosses the next lane, fortunately missing other cars before spinning off the shoulder into the brush along the highway.  Fortunately, the driver, your customer, wrestled the car without further damage to the vehicles around him. Amazingly, he was only a short distance away from entering a major and much busier highway during rush hour.

A SIGH OF RELIEF FOR EVERYONE…

The tow truck comes and tows the car back to the same garage where it was the day before. The investigation shows that the lug nuts on the wheel were not tightened properly when the inspection was finished the prior day. Truly an error by the mechanic (or, in this case, an apprentice) who installed the wheels on the vehicle after the mechanic’s inspection was complete.

In this scenario, nothing major happened, and the car was repaired. The driver was without injury. They claimed their insurance company. The insurance company can choose to go after the garage’s insurance company for the claim’s cost (subrogation). For the garage, in this case, the cost is reputation damage. The garage lost a customer who also warned whoever would listen about their experience anywhere and everywhere they went… how do you think I heard the story?

LET’S PLAY THE “WHAT IF” GAME…

It is critical at this moment to play the “what if” game. What if the tire or his vehicle hit another car? What if the impact caused serious injury or a fatality? What if he was driving much faster on a major highway when the tire came off?

The results could have been catastrophic and all because of a simple, yet costly, error. An error that very rarely happens but does happen none-the-less. Will it ever happen to you at your garage? Probably not. That’s what insurance is truly for – covering you for the probably not in your business.

The story I shared is true. It is a friend of mine. He has a family with two kids. He works as a graphic animator for a cartoon studio. He was a responsible driver, getting his winter tires on early just in case bad weather ensued.

WHAT IF THIS WAS YOUR CUSTOMER?

Imagine this was your customer. Putting the viability of your continued business operation aside for a moment, if something did happen, wouldn’t you want to know your customer was going to be financially looked after? And for your garage, wouldn’t you want to continue operating, knowing it was a one-time human error?

This story is pretty much the tamest scenario possible. What if it was even worse? Is your liability limit adequate?

HOW MUCH DOES A LIABILITY CLAIM COST?

Legal fees have shot up in the past couple of years. Settlement costs are on the rise… maybe multiple settlements could have come out of this case. Consider, too, if there was a catastrophic injury to a child and you were responsible for paying quality of life costs for their life.

When I have this conversation with the garage owners I meet, the answer is usually no… but I have had it at this level for years. Buying up liability insurance is surprisingly inexpensive. For only a dollar or two a day, you can drastically increase your liability protection.

Again, insurance is here for the “probably not” incidents in your business. You likely will never experience this situation in your business, but it is the rare things that happen where insurance saves the day… and your business.

ARE YOU PAYING FOR THE RIGHT INSURANCE?

If you are going to pay for insurance, you may as well pay for the proper coverage. Otherwise, what are you paying for?

Speak with a Bryson Garage Insurance Specialist and have your liability coverage and the rest of your policy checked so the wheels don’t come off on your business when a claim occurs.

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Written by:

Scott Bryson
Scott Bryson has been in the insurance industry since 1996. Scott started his career with Bryson Insurance and has experience serving in almost every role within the organization. His wide-ranging of experience provides Scott with a unique perspective and understanding of the insurance process which allows him to be a strong partner with both his co-workers and clients.

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