Garagekeepers liability is insurance that covers damage to customers’ vehicles while they are in the care, custody or control of a parking operation. It is the exposure created whenever keys change hands.
Valet and attended operations carry the exposure directly, because the operator takes custody of the car. Self-park facilities largely avoid it, because the customer parks, keeps the keys and never hands over control. The legal principle of bailment determines when custody, and therefore the exposure, attaches.
What to understand about coverage
- What is covered. Typically collision, theft, fire and vandalism to customer vehicles in the operator’s custody, subject to the policy terms.
- Legal liability versus direct coverage. Some policies pay only when the operator is legally liable; others pay for covered damage regardless of fault, which reduces disputes with customers.
- Contents and keys. Personal property inside vehicles and lost or misused keys are often excluded or limited.
- Contracts. Owners usually require operators to carry garagekeepers coverage in the operating agreement and to name the owner as an additional insured.
The Parkonomics view
How the facility takes cars determines how it must be insured. Adding valet to a self-park garage is not just a staffing change; it changes the risk and the policy.
Related terms: Bailment, Attendant Parking, Self-Park Garage, Owner-Operator Agreement, Method of Operation