Car dealerships face a variety of liability risks involving customers, employees, test drives, vehicle inventory, property conditions, and daily operations. This guide explains how dealers can reduce liability risks by maintaining a safe dealership lot, establishing test drive procedures, securing inventory, training employees, documenting incidents, controlling access to hazardous areas, and maintaining appropriate commercial insurance coverage.

Open lot insurance is designed to protect a car dealer’s inventory from physical damage such as theft, vandalism, fire, hail, and other risks. It is a critical coverage for dealerships since inventory is often their largest asset. This guide explains what open lot insurance covers, what it doesn’t, how it differs from garage liability insurance, and how dealers can protect their vehicles and reduce risk.