risk assessment

business

Auto service

We understand that success is what gets your motor running, and we know that no two oil-change services, garages, body shops or grease monkeys are the same. Common risks concerning auto service businesses appear below. For truly personalized business solutions, contact your local, independent Allied agent for more details.

High risk

Product liability

Your product is the quality of your service, which means your business may be at a bigger risk for liability expenses related to faulty repairs or parts installation.

• Follow manufacturers’ instructions on parts installation
• Watch recall bulletins, and tell customers about items that are a known hazard
• Don’t substitute anchors or alter fixtures when installing a part
• Tell customers about the risks and benefits of certain repairs and don’t go on without their consent
• Keep customers informed of your progress
• Put your contact information on your receipts or attach a business card

By keeping up with what’s new in your industry, you provide the highest quality car care to your customers. For industry news, visit the Automotive Service Association (ASA) and the Car Care Council.

Watch for consumer product recalls before you install or assemble, and check with the Consumer Product Safety Commission (CPSC) to see special instructions or warnings to customers.

Workers’ compensation

Working in a garage can be dangerous. Oil spills, power tools, welding, paint fumes and even your offices bring potential hazards. Accidental injuries aren’t the only workers’ compensation risk, though. Repetitive stress or gradual illnesses from exposures can also produce a claim.

• Train employees to operate tools safely, especially power tools and welding machines
• Mark traffic paths in/out of doors and around corners
• Require personal protective equipment like goggles, gloves, hearing protection, masks and sturdy footwear
• Be extra careful when cleaning oily or dusty spills
• Choose a safety officer or committee to help with safety training
• Learn about ergonomics and warning signs of risk factors, including awkward posture, high hand force, repetitive motion and heavy lifting
• Put waste in proper containers, especially chemicals or sharp objects
• Review Materials Safety Data Sheets (MSDS) to make sure you have the right protective gear

Workers’ Compensation laws are different for each state. Check the US Department of Labor to find specific information about yours.

If your garage does any welding, check out the American Welding Society for more on keeping your workplace safe.

Medium risk

General liability

It’s easy to see why you love your work. But, just opening your doors for business each day can open you to liability. Any sort of harm to visitors on your premises can hurt your bottom line. Keep it safer by planning ahead, staying alert, and having a policy for damage control.

• Dispose of oily rags, fuels, solvents, glass, rubber, batteries and sharp objects according to pollution laws
• Use brighter lights in walking and parking areas
• Keep refreshment centers and coffee stations clean and safe
• Limit visitors in work areas and insist they are accompanied by an employee
• Use extra care in cleaning floor spills to prevent slips and falls
• Keep underground service pits well marked and cover them when not in use

For information about pollution and safe disposal of certain types of hazardous materials, visit the Environmental Protection Agency (EPA).

Fire

The contents of your shop are essential to your business, so extra planning around fire safety can't hurt. Most garages have a design in which fire spreads quickly. After the flames are out, you might find that smoke or water may have also damaged your property. Your risk varies with how much and what type of work you do, but keep a watchful eye on all types of fire hazards, to stay on the safe side.

• Store flammable chemicals in UL approved containers and use them only as directed
• Don’t store combustible materials next to mechanical equipment.
• Restrict welding to a designated area
• Do electrical checks to find frayed or loose wires that could throw sparks
• Keep inventory away from light fixtures, furnace vents or other heat sources
• Install grounding and bonding systems to decrease static electricity sparks when pouring flammable chemicals
• Keep extinguishers charged and accessible
• Test smoke detectors and fire alarms, have fire drills twice a year
• Train employees to watch for fire hazards

For additional information on fire safety and prevention, visit the National Fire Protection Agency (NFPA) and FireSafety.gov.

Crime/theft

Auto shops are sometimes tempting for thieves. It may be easy to re-sell stolen goods, there might be cash on hand and some garages have poor security. Don’t leave your assets vulnerable. Make your business as unattractive as possible to criminals.

• Deposit receipts at the bank daily
• Store customer vehicles in a protected parking lot or inside your garage, and lock up their keys in your safe overnight
• Install a UL approved central alarm and sturdy locks at entry points
• Keep supplies and equipment out of plain sight overnight
• Require identification before you allow access to customer vehicles
• No matter what, dishonest people can find ways to steal. If you suspect theft, call the police. Don't play detective or try to solve the crime, and don’t jump to conclusions. False accusations could result in serious civil liability

The National Crime Prevention Council has information and tips for reducing all types of crime, theft and violence in homes and businesses.

Auto/fleet

If you offer roadside service or if you run a quick company errand in your own car, you need to practice fleet safety. Most personal auto insurance doesn’t apply to accidents that happen on business time. Be sure you’re covered, in case of emergency.

• Require all employees to wear safety belts
• Test-drive customer vehicles on slower streets with less traffic
• Log maintenance, repairs, and accidents for each company vehicle
• Watch for signs of distracted or dangerous drivers on the road
• Provide a cell phone in case drivers need to contact you, but be sure to remind them to pull over in a safe location before they call
• Don’t put your keys in the hands of an unsafe driver. Check the driving records of anyone who uses company vehicles

For more on driving safely, visit the National Highway Traffic Safety Administration and the Insurance Institute for Highway Safety.

Low risk

Equipment failure

Modern machinery helps you work more efficiently, but you could get by the old-fashioned way if you had to -- with a toolbox and some oil. Your business might hurt if your equipment were to break down for a couple days. So, plan now for what you need in a major outage, before you’re caught off guard.

• Schedule checks on essential equipment
• Prepare for breakdowns by finding equipment rental companies
• Come up with a plan for working without certain machines
• Keep warranty and purchase or lease information organized
• Buy a back-up generator for electricity outages

The efficiency experts at EnergyStar have information about reducing energy needs, so you can keep the business running as long as possible during a blackout.

Professional liability

If you instruct or consult other mechanics or if you do custom work, you run a higher risk of professional liability. If you don’t, that still doesn’t mean you’re fully protected from this type of risk. You could be responsible if you recommend a product to someone and an injury occurs.

• Display manufacturer guarantees, installation instructions, and warnings
• Print customer agreements to help clients keep realistic expectations
• Never misrepresent the performance of a product
• Supervise apprentices and assistants closely
• Explain to customers how they can keep their cars or trucks running well

Visit the National Institute for Automobile Service Excellence to learn more about professional training and certification to stay on top of your field.

Data loss

To keep up with competition, inventory and customers, you probably use computers. If you have a website, you use them even more. So, you know that when computers have problems, business suffers. With a little planning, you can work around occasional system failures.

• Keep paper copies of electronic records and update once a month
• Backup computer files daily or weekly on a disk and store offsite
• Install a UPS (uninterruptible power supply) to give you time to make a clean shut down during power surges or blackouts
• Create a recovery kit, including system disks, registration, manuals and a recent backup
• Use and update anti-virus software
• Train everyone on startup, data entry and shutdown
• If you have questions, contact a technical support person. Most computer retailers have contact information for reliable technical assistance if you need it

Protect yourself better from internet threats after you visit the Information Security website provided by the Federal Trade Commission.

For even more information, and to keep posted on the latest tips and trends, visit:

• Occupational Health and Safety Administration (OSHA)
• National Safety Council
• Institute for Business and Home Safety
• National Institute for Occupational Safety and Health
• US Department of Homeland Security

The information contained herein is intended to assist you in making decisions that may reduce your risk of loss, but is not intended as an inclusive list of all risks. The information contained in this publication was obtained from sources believed to be reliable. Nationwide Mutual Insurance Company and its employees make no guarantee of results, and assume no liability in connection with the safety and loss control suggestions or information contained herein. Furthermore, it cannot be assumed that every acceptable safety or loss control method is contained in this publication, or that unusual circumstances may not require additional methods. The maintenance of safe premises, operations, and equipment is your legal responsibility. Nationwide cannot and does not guarantee that any of the advice is in compliance with your specific state laws.