Appliance Repair Company Insurance After You Buy

If you just bought an appliance repair company, start with the claim that arrives after the technician has left: a fire, shock or leak weeks after a repair. Check that liability with completed operations coverage is in force in your name, then work through customers' appliances in your care, the service vans, the technicians and the tools. Confirm each one is bound for the new owner before you lean on the seller's program. This guide is for buyers who now send technicians into strangers' kitchens, including entrepreneurship through acquisition (ETA) searchers, search fund CEOs and borrowers with a Small Business Administration (SBA) loan.

The short answer

The work happens inside customers' homes, so the claims to plan for first are a fire, shock or water loss that appears after the technician has left. Liability with completed operations coverage (liability for damage after the job is finished) is the first policy to check.
Standard liability forms generally exclude property in your care, custody or control. A customer's refrigerator or washer on your bench is that kind of property, so it needs its own answer.
Vans and the technicians who drive them usually need commercial auto, because general liability excludes autos. Tools and test gear that travel are usually written on an inland marine form, which follows property that moves. Parts stock at the shop is commercial property, and parts carried in vans need a specific decision.
Workers' comp covers technicians hurt lifting, burned or shocked. The policy usually requires you to report the ownership change to the insurer within 90 days; state rules vary.
A quote, an application or a certificate is not coverage. Confirm what is bound, in whose name and from which date.

Which policies does a repair company with vans and technicians in homes actually need?

Think of the company as a van, a technician, a customer's kitchen and, at some companies, a shop bench. Each one has a coverage that usually responds. The table is a map, not a quote. What a policy actually pays depends on its forms and endorsements, so check the wording of the policies you inherited.

Core coverage by exposure in an appliance repair company
Exposure	Coverage that usually responds	What to confirm first
Fire, shock or gas incident weeks after a repair or install	General liability, including products and completed operations (liability for work after you finish it)	That completed operations is included, and its own aggregate limit
Water loss from a reconnected line, hose or drain	General liability	Limit, deductible, and any water exclusion added by endorsement
Damage to a floor, wall or cabinet while moving a unit	General liability, subject to an exclusion for the particular part of the property you are working on	How the policy treats damage while the job is under way
A customer's appliance on your bench or in your van	A bailee's customers form or similar inland marine cover, if one was bought	Standard liability usually excludes property in your care; check whether the property form has any wording for personal property of others
Tools, test gear, refrigerant recovery equipment, parts stock	Coverage for tools and goods that travel (inland marine), commercial property	Whether it follows tools off premises; how items are valued
A technician injured lifting, shocked or burned	Workers' compensation	Class, payroll estimate, experience mod (the factor that adjusts premium for past claims), ownership change report
A van crash on the way to a call	Commercial auto	Vans and drivers listed, titles, hired and non-owned cover
Fire at the shop, or a shutdown after a covered loss	Commercial property, business income	Replacement cost, waiting period, and that the loss must come from direct physical damage
Billing fraud, card data, theft allegations from a customer	Crime, cyber	Whether theft of a customer's property is covered at all
A very large fire or injury claim	Umbrella	Which primary policies sit underneath it

What comes first. A suggested order, not a rule: at closing, have liability with completed operations, commercial auto and workers' comp bound in the new owner's name. If customers' appliances are on the premises or in vans at closing, move customers' goods cover up to the closing list. Otherwise, within the first 90 days, take up customers' goods cover, tools and stock, an umbrella and a decision on professional liability. Your loan documents or contracts may set a different deadline.

The general liability, commercial auto and inland marine pages explain each line in general terms.

What happens if a repair fails weeks after the technician has left?

A technician can do a clean job and still be named in a claim later. The work is finished, the van is gone, and a fire, a shock or a leak shows up weeks afterward. The part of liability coverage that answers that situation is called completed operations, and it is usually written together with products coverage because you also sell and install parts.

Fires are rare but large, and water losses are more common but smaller. The Insurance Information Institute, citing industry claims data, reports that over 2019 to 2023 there were about 1.50 water damage and freezing claims per 100 homeowners policies at an average of $15,400, against 0.23 fire and lightning claims per 100 policies at an average of $88,170. Neither is repair company data, and neither says who was at fault.

The U.S. Fire Administration estimated about 2,900 clothes dryer fires a year in residential buildings reported to fire departments in 2008 to 2010. Failure to clean was the leading factor (34 percent), and it falls within the report's broader operational deficiency category. The report's other categories were mechanical failure, electrical failure, misuse, and design, manufacture or installation deficiency. That data is old and cannot assign fault to anyone who serviced a dryer. When a homeowner's or landlord's insurer pays one of these losses, it may look to the contractor who last worked on the appliance. Whether it does depends on the facts and the policies.

A hypothetical example. Five weeks before you close, the seller's technician replaces a heating element and reconnects the vent on a gas dryer in a rented duplex. Three weeks after closing, lint ignites and the fire spreads to the laundry room and kitchen, a $60,000 loss. The landlord's insurer pays and looks to the repair company, which says the tenant never cleaned the vent. Three questions decide how it goes:

Which policy was in force when the fire happened? Under an occurrence policy (one that responds to damage during its policy period), the policy that responds is generally the one in force when the damage occurs, not on the repair date.
Was this a stock or an asset purchase? In a stock purchase the company is the same, so the earlier repair is its own work. In an asset purchase, a fire after closing on a repair the seller's technician did before closing is a question for your policy, because the standard form's "your work" wording has no matching language for the work of a business you acquired.
Does the seller's loss history show how earlier fire or water claims were handled? The seller's older occurrence policies matter mainly for damage that happened during their periods, even if the claim arrives later.

See completed operations claims from the seller's past jobs for how that plays out.

What about the customer's appliance on your bench or in your van?

If you take appliances back to the shop or haul old ones away, you hold other people's property (the legal word for you is a bailee), and standard liability forms generally exclude property in the insured's care, custody or control. See the glossary on care, custody and control. Your own property policy is written mainly for your property, so ask whether it extends to customers' goods in your care, at what limit, and whether it follows them into a van. A bailee's customers form or similar inland marine policy is the usual way to fit limits and valuation to units held for repair.

Do not assume a businessowners policy (BOP) or package policy includes this, because it depends on the form. Garagekeepers cover is built for cars, not appliances. The article on coverage gaps new owners find covers goods in your care in detail.

What do the vans, the tools and the people need?

Vans. General liability excludes autos, so every van that carries a technician usually needs commercial auto. The standard business auto form has no automatic coverage for a newly acquired company, so confirm the vans, the drivers and the titles are in the new owner's name. If anyone drives a personal vehicle to calls, ask about hired and non-owned auto. See commercial auto insurance.

Tools and stock. A technician's circuit testers, dollies and recovery equipment, plus the parts stock in the van, move all day. Property forms often cover business property at the premises and only a short distance beyond, and liability forms do not insure your own equipment, so tools that travel are usually written on an inland marine (contractors equipment) form. Check the wording and limits against what is actually in the vans.

Technicians. Workers' compensation is required in most states. The business's payroll and claims history usually follows it to the new owner, and the standard workers' comp policy requires reporting an ownership change to the insurer within 90 days; some states have their own routes. The detail is in workers' comp and payroll for an appliance repair company.

The shop. If there is a lease and a bench, commercial property may cover contents and parts, depending on the form and limits, and business income covers lost profit after a covered physical loss, usually after a waiting period of about 72 hours under the standard form. It does not pay if you lose your biggest customer.

What should you confirm in the first weeks?

Work down this list in order. Each item takes a call or an email, not a project.

Named insured. The policies should show the legal entity that now owns and operates the company, with any trade names the vans and invoices use.
Dates and what is bound. Ask the carrier, not only the seller, which policies are in force today and when each renews.
Loss runs. Request five years of loss runs and read them for fire, water and technician injury claims, and for anything still open.
Vans and drivers. Match the schedule of vehicles to the vans you actually own and the people who actually drive them.
Customers' goods. Find out whether any policy covers appliances held for repair. If not, note it as a gap to decide on.
Service plans. If the company sold prepaid maintenance plans, ask how many are outstanding. They may be obligations you took on, depending on the deal structure, so ask deal counsel.
Customer agreements. Read any vendor agreement that sets insurance requirements. The contracts article in this series covers them: contracts, licenses and bonds.

The series' insurance checklist for buying a business and the guide to your first 90 days put these steps on a calendar.

What will an SBA lender want to see?

For 7(a) loans over $50,000 numbered on or after October 1, 2026, SBA's Standard Operating Procedure (SOP) 50 10 8.1 requires hazard insurance on assets pledged as collateral, with exceptions. Earlier loans stay under SOP 50 10 8, so check your loan documents. Equipment and inventory must be insured for full replacement cost (or maximum insurable value if replacement cost is not available) with a lender's loss payable clause in the lender's favor. For a mostly mobile repair company, the vans and the parts stock are often the collateral that matters. Lenders may require more for liability and workers' compensation, and your loan documents say what yours asks for. Put the answers in your first lender or investor update: which policies are bound, in whose name, and what is still open.

A lender can set insurance standards, but it is a different question whether it can name your agent. The guide on SBA lender insurance requirements covers both. A Morrow review can compare the inherited policies to your loan terms, and any new terms depend on carrier underwriting.

Keep reading

Frequently asked questions

Does my general liability policy cover the appliance I am repairing?

Usually not. Standard liability forms generally exclude the cost of repairing the part that was worked on wrongly, and property in your care, custody or control. A customer's appliance in your shop is in that last group. Ask about a bailee's customers form or similar inland marine coverage, and read your policy wording.

Do the seller's policies cover repairs the company did before I bought it?

They may, depending on deal structure and state law, for injury or damage that happened during their policy periods, even if the claim arrives later. In a stock purchase the insured company is the same entity. In an asset purchase you may not be able to use the seller's older policies. Damage that happens after closing falls under the policy in force then, so ask whether your own policy treats the seller's finished work as covered, and ask deal counsel how the purchase agreement allocates old claims. Claims-made policies (which cover claims reported during the policy period) need a tail or a retroactive date, so ask your broker.

Do I need commercial auto if technicians drive their own cars sometimes?

General liability excludes autos, so a crash in a personal car on company business can be a gap unless hired and non-owned auto coverage is on the commercial auto policy. Ask your broker how the policy treats employees' own vehicles and who is allowed to drive company vans.

Is a quote the same as coverage?

No. A quote or an application is not coverage until it is bound, by the carrier or by an agent or managing general agent with binding authority. Confirm in writing what is bound, the effective date and the named insured before the seller's policies end.

Who can look over the policies I inherited and tell me what is missing?

Morrow can review declarations pages, loss runs and customer agreements against the company you bought, flag gaps and request quotes. It is licensed only in the states listed on its licensing page, and terms depend on carrier underwriting.

References

Just bought a business? Get your insurance reviewed.

Send Morrow the declarations pages, loss runs and key contracts you inherited. Morrow can review them against the business you bought, flag gaps and request quotes where it makes sense. Any new terms depend on carrier underwriting.

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This article is general information, not legal, tax or financial advice, and not a coverage determination. Coverage depends on the actual policy wording, carrier underwriting, your purchase agreement and your contracts. Ask your attorney and accountant about deal and legal questions.

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