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Garage Liability Insurance in Kentucky

Kentucky requires covered dealer and wholesaler licenses to keep an approved indemnifying bond or qualifying insurance policy on file; for most dealers the statute sets $250,000/$500,000/$250,000 limits. When a customer borrows a dealer vehicle during a breakdown, repair, or service, the statutory dealer coverage is secondary to the customer’s own listed coverages for that customer’s negligence, so explain loaners to the broker. 1,2

What Is Garage Liability?

Garage liability can address injury and property-damage claims from auto repair and related garage operations. If you run a repair or service shop, check separately whether customer cars in your care need garagekeepers coverage for vehicle damage. Read the national Garage liability guide.

Kentucky Requirements

RequirementDetails
Covered dealer license securityApproved indemnifying bond or insurance policy; an authorized self-insurer with a Department of Insurance certificate is exempt 1
Dealer liability amount (excluding automotive recyclers)$250,000 one person / $500,000 one accident / $250,000 property damage 1

What to Watch for in Kentucky

  • Distinguish the Filing From Your Policy

    KRS 190.033 permits an approved indemnifying bond or insurance policy for covered licenses, with an exception for dealers holding a Department of Insurance self-insurance certificate. Kentucky’s application regulation separately says applicants must obtain garage liability insurance and file a certificate in the exact license name; reconcile both requirements before binding. 1,2

  • Describe Repair Loaners Precisely

    For most dealers, the statutory policy or bond coverage is secondary to the customer’s own collision, bodily-injury, and property-damage liability coverage for that customer’s own negligence when the customer borrows a vehicle because theirs is out of use for breakdown, repair, or service. Otherwise the required dealer coverage is primary; ask how the quote and customer paperwork handle the statutory situation. 1

  • Check the Automotive Recycler Exception

    KRS 190.033 excludes automotive recycling dealers from the dealer-vehicle public-liability/property-damage provision and instead specifies commercial general liability amounts for them. If your operation includes recycling, verify its classification and do not assume the ordinary dealer schedule applies. 1

  • Match the License Name and Term

    The required bond or policy must be in the applicant’s or holder’s exact license name and remain continuously in force; cancellation notice to the Commission is at least 15 days, and the right to operate abates on cancellation. Ask the broker to coordinate the entity name and renewal dates with the Commission filing. 1,2

Who Regulates Insurance in Kentucky

Kentucky Department of Insurance

The Kentucky Department of Insurance licenses agents and insurers, monitors the insurance market, and accepts complaints about insurance companies and agents. You can use its state lookup or complaint service to check a license or raise an insurance issue. 3,4,5

Surplus-lines tax and stamping office

Reported tax rate: 3% on Kentucky-home-state premiums and other premium consideration; separate 1.8% surcharge on eligible risks located in Kentucky, subject to statutory exceptions; applicable local-government premium tax may also apply When Kentucky is the insured's home state, the state tax is 3% of premium and other consideration treated as premium; local-government premium taxes may also apply. A separate 1.8% surcharge generally applies to Kentucky risks, but state law exempts multistate nonadmitted risks and specified government and nonprofit premiums. The broker must make a diligent effort to place coverage with an admitted carrier before using surplus lines. 6,9,7,8,10

Providers With Documented State Licenses

No provider in Spot’s research documents both a state license record and this coverage line. This does not establish that providers are unlicensed. Check the regulator’s license lookup and confirm availability with a provider when requesting a quote.

Questions to Ask Before You Buy in Kentucky

  1. Does the Commission filing use the exact licensed entity, and how does the proposed policy satisfy the application regulation alongside the statute’s bond-or-policy option?
  2. How does the contract address customer test drives and loaners during repairs, including primary or excess status for the customer’s own negligence?
  3. Are any of our activities classified as automotive recycling, auction, wholesale, leasing, or another category with different statutory treatment?

Garage Liability in Kentucky: FAQ

Does Kentucky require a bond or insurance for every motor vehicle dealer license? 1

KRS 190.033 requires an approved indemnifying bond or policy for the listed dealer, new recreational-vehicle dealer, auction-dealer, and wholesaler licenses, subject to a self-insurance certificate exception. Automotive recyclers have different liability terms. 1

Whose coverage is primary when a Kentucky dealer loans a car during repairs? 1

For the borrower’s own negligence, the statutory dealer coverage is secondary to the borrower’s own collision, bodily-injury, and property-damage liability coverage when the customer’s vehicle is out of use because of breakdown, repair, or service. Otherwise the mandated coverage is primary. 1

What name should appear on a Kentucky dealer insurance certificate? 2

Kentucky’s application regulation requires the certificate in the exact name used for the license application. 2

Garage Liability in Other States

Other Coverage in Kentucky

Sources

  1. KRS 190.033, Insurance or bond required of licensees — Exemption. Kentucky General Assembly, Legislative Research Commission; §190.033(1)–(4); current effective text amended by 2025 Ky. Acts ch. 12, effective June 27, 2025. Accessed 2026-09-28.
  2. 605 KAR 1:030, Applications. Kentucky General Assembly, Legislative Research Commission; Section 3(6). Accessed 2026-09-28.
  3. Kentucky Department of Insurance. Kentucky Department of Insurance; Homepage and consumer telephone. Accessed 2026-09-28.
  4. Insurance License Lookup. Kentucky Department of Insurance; State-designated producer/company search. Accessed 2026-09-28.
  5. File an Insurance Complaint. Kentucky Department of Insurance; Official DOI consumer complaint page accepts complaints involving general liability and disputes with insurers, agents or adjusters. Accessed 2026-09-28.
  6. KRS 304.10-180. Kentucky General Assembly; KRS 304.10-180(1): Kentucky-home-state; 3% applies to premiums, assessments, fees, charges or other premium consideration; local premium tax is separate. Accessed 2026-09-28.
  7. Local Government Premium Taxes. Kentucky Department of Insurance; Current local tax schedules. Accessed 2026-09-28.
  8. KRS 304.10-090. Kentucky General Assembly; KRS 304.10-090 requires policy notice that nonadmitted insurer is not a Kentucky Insurance Guaranty Association member and its benefits are unavailable upon insolvency. Accessed 2026-09-28.
  9. KRS 136.392. Kentucky General Assembly; KRS 136.392(1),(5)-(6): $1.80 per $100 on premium/other charges for Kentucky risks; named government/nonprofit exceptions; multistate nonadmitted risks exempt. Accessed 2026-09-28.
  10. Surplus Lines. Kentucky Department of Insurance; Full page states licensed surplus-lines brokers must make a diligent effort to place with an admitted carrier before exporting coverage. Accessed 2026-09-28.
  11. Licenses. At-Bay; Current producer introduction and state table; At-Bay Insurance Services LLC; P&C and surplus-lines identifiers. Accessed 2026-09-21.
  12. Licenses and Carriers. Coalition; Licenses and Carriers, re-read 22 September 2026: Insurance Licenses table for Coalition Insurance Solutions, Inc., national producer number 18419475, with producer and surplus-lines numbers for all 50 states and DC including California 0L76155, Georgia 196479, Texas 2199630 and 2205589, Pennsylvania 815731 and 817452, Colorado 539028 and Wisconsin 3000108852. Insurance Carriers table naming, with NAIC numbers, Allianz Underwriters Insurance Company 36420, Arch Specialty Insurance Company 21199, Ascot Specialty Insurance Company 45055, Ascot Insurance Company 23752, Aspen Specialty Insurance Company 10717, Chaucer Insurance Company DAC, Coalition Insurance Company 29530, Fireman's Fund Indemnity Corporation 11380, Fortegra Specialty Insurance Company 16823, Lloyd's of London, MSIG Specialty Insurance USA Inc. 34886, MS Transverse Specialty Insurance Company 41807, Steadfast Insurance Company 26387, Vantage Risk Specialty Insurance Company 16275 and Zurich American Insurance Company 16535. Accessed 2026-09-22.
  13. Insurance Producer Licenses. Corgi Insurance; Current complete Insurance Producer Licenses table for Corgi Insurance Services, Inc.; 50 rows covering 49 states and DC (DC 3003091619); no New Mexico row; no NPN or as-of date shown. Accessed 2026-09-28.
  14. About Hiscox US Insurance. Hiscox; Hiscox Insurance Company Inc. NAIC 10200 as Chicago, IL domiciled insurer admitted or licensed in all 50 states and D.C.; Hiscox Inc. as general agent and Lloyd’s coverholder for Syndicates 33 and 3624; surplus-lines placements through licensed surplus-lines brokers; A.M. Best rating statement. Accessed 2026-09-16.
  15. Licenses. ERGO NEXT Insurance; Current entity-by-state license table reopened 28 September 2026: 50 rows under Next First Insurance Agency, Inc., including Washington, DC; New York rows instead list Next Insurance Services PC-1423070 and AP Intego BR-1198885. Accessed 2026-09-28.
  16. Insurance Licenses by State. TechInsurance; Current state table; identifies TechInsurance as a division of Specialty Program Group LLC d/b/a SPG Insurance Solutions; lists DC 3000041536 and labels Rhode Island “Individual licenses,” without an agency license number. Accessed 2026-09-28.
  17. Licenses. Vouch; Effective 16 January 2025: Vouch Specialty Insurance Services, LLC, NPN 19926463; P&C table (50 states and DC); surplus-lines table includes Idaho 870820; footnote says Georgia and Idaho do not issue agency-level surplus-lines licenses; Idaho retained as producer-only due to conflict. Accessed 2026-09-15.

Updated .

This guide is informational and does not determine whether a policy is available or meets your needs. Editorial policy. To suggest a correction, contact Spot with a supporting source.

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