restoration insurance

I'm preparing to send one of my cars to a restoration shop. I've got their agreement here, and it says they cover liability on it while it's in their possession, but that I should also cover it to have "the best chance to recoup your full investment in your car".

It kind of seems to me like language that his insurance company requires so they can share liability with my insurance.

If it was your car, would you go ahead and insure it? It's nowhere near finished; I expect at least 6 months until I get it back. I've got about $30k in the car and parts so far, but never felt like I needed insurance because it's all safe in my garage.

(It's a reputable tax-collecting (ouch) shop with employees, not some dude working in his garage on weekends)

Thanks!!

They're referring to liability insurance, which means their insurance will cover someone else's stuff if they damage someone else's car while driving your car. That has nothing to do with covering your car for damages. However, their insurance also covers your car while it is in their "care, custody, and control." If they damage it, or if the shop catches on fire, etc. their insurance will cover your car.

That said, if it were my car, I would also insure it myself. That way, if something does happen, and you don't like the way their insurance is handling things, you can turn it over to your own insurer. Lots of collector car companies offer coverage for projects/cars undergoing restoration. It's cheap, too.

Thanks.

I could foresee my luck being the car would be a total loss and the insurance would offer me 3k+50% of the labor I've spent on the resto so far. It's an A12 but they could get away with it because insurance law is only passionate with regard to helping the companies keep as much money as possible. You might remember the battle I lost over damages to my low-mileage GTI. Lesson learned.


I will get it set up before it leaves here.

Good advice
My Garage keepers Liability has been as high as 150K per vehicle, but due to my ramping down it's now at about 50K. He may be carrying a minimal amount as I am now and is advising you in yours and his best interest

Another good reason You never know if the shop paid their insurance premiums, or is carrying less coverage than they need, etc.

I had comprehensive insurance on my car while it was in my garage and I was restoring it, don't know if that works if it is at someone else's shop. I paid $16/year and they paid out $45K when my garage burned down on top if it...

I looked at Hagerty and they have restoration or project insurance but they describe it as though you're doing the work yourself. Pretty sure that doesn't really matter though, it's just marketing verbiage.

All my cars & trucks, except the 2 daily drivers, are with Hagerty, and I do that full-coverage from the moment they're mine.
3 cars & 2 trucks, at market value, for about $1100/year; the other Hagerty benefits, including towing, are included.
A smokin' deal for the peace of mind, IMO.
I dealt with them as a repairer before I became a customer; excellent company.
They also do a lot for the hobby.

Absolutely carry insurance on your car. Also never ever fully trust ANY shop owner I don't care who they are even if you have everything in writing...it had better be in a contract notarized and written up by a lawyer. Cover your six, they do not care and you are just another payday, never forget you are not friends....you are a customer. Trust me on this, if something happens it will be your responsibility, even if they do bad work, and every other resto shop in town will be on their side. You are truly alone when something happens with these guys, as it should be, so treat them the same, trust nothing.

With a non reputable shop nothing will protect you as they usually have nothing to recoup you losses and will just move on to the next fish. A paint place up in Fremont wound up in trouble with one of my customers. When his attorney got involved the owner more judgment's and liens against him and the business than one would have thought was legal.
And I would never take the side of a shyster but will agree there are many out there especially in this line of work. CYA x 10 and PAY NOTHING until any work and parts being billed for is completed and on sight. I have never requested or taken a red cent up front in 25 years.

Reputation does not matter, you still may be the next victim no matter how "good" the shop may be. With insurance make them prove it with paperwork.

Agreed as many run without it due to the cost

I'll insure it myself to be sure. They aren't going to be able to drive it anywhere to worry about that sort of liability. The drivetrain will be sitting in my garage until the engine bay and underside are painted.

I would not worry about them driving it. You need to insure for theft, vandalism, fire, and just maybe one day you go to the shop and they are gone and so is your car and parts. Quality of work is on you and the lawyers to manage in most cases.

Understood.

Thanks everybody. Once I thought about it, I realized it was a dumb question

There are no dumb questions, we all want a perfect relationship with the restoration/paint shop, sometimes things happen you cannot know as an individual on the outside about business internals so you have to cover yourself. Good luck, keep an eye on them, and I hope it all goes well.

Agreed and a few pic's for 4406bbl

A few more ;)|

Not good.

I had a friend who took his Chevelle in for exhaust.

Car got stolen from the exhaust shop with pretty much all the documentation of parts & labor in the trunk. Why it was in there, I do not know.

Insurance for the shop didn't want to pay so he went to court and won a judgement of 50K for the car.
They appealed and he lost. In the end he got nothing, no car no money.

I would carry the extra insurance if you already have 30k in the car. Just to be safe.

Only let them have what parts they need as they need them. People you've never met go in and out of these resto shops and your hard to replace parts and supplies can grow legs and walk out the door just like that.

There are some details missing from that story he told you. I don't doubt it was stolen, or that he ended up with nothing, but if he left his care in the care, custody, and control of a shop that had valid coverage with sufficient limits, they have to pay. It sounds like there may have been a coverage problem with the shop's insurance.

Agreed

The reason we should not rely on the shop keepers insurance is because it is a liability policy that covers HIS liability. He COULD be considered liable for thing that happen to your car while in his care like fire, theft, falling off a hoist, something falls on it, etc. But it doesn't mean he WILL be.
Problems are that liability insurance only pays for actual cash value, not replacement cost. And his insurance company doesn't give a hoot about you. They can get some hired gun appraiser to put a super low actual cash value on your car because it is apart. Or they can flat out deny that it is the shops fault. He could have some cheap class C rated company, most of whose modus operandi is to deny, deny, deny, and only pay if they are forced to. Your only recourse is to sue them.

Restoration horror stories are why I never sent the car away to be restored - I wanted to be able to pop in unannounced and keep track of them.

After an insurance rep quoted me chapter and verse out of the WV insurance codes, and said if I don't like it I should lobby to have the laws changed, I decided that sueing an insurance company over car damages is a fool's errand. They made it clear right up front that I had no chance of winning.

So, restoration insurance will be purchased with a stated value on the car that increases over time. That way if something happens I get paid, and my insurance and the shop's insurance can fight it out.

Great choice, the insurance company has better lawyers than you could ever afford, other things to watch for so you do not get screwed.

A shop owner who will not respond to e-mails or texts about your car or process.
He wants you to have no evidence if it all goes wrong, record all calls or face to face meetings if that starts.
Absolutely show up unannounced, if they make you schedule visits, do not go there.
Shop owners that talk about other cars owners in their shop to you in a negative way.