Garage liability insurance and dealer bonds
Garage liability insurance
Dealer liability minimums
- Bodily injury / person
- $100,000
- Bodily injury / accident
- $300,000
- Property damage
- $50,000
The certificate must identify the dealership business name and location and must not expire before December 31.
Insurance requirementsDealer bond
$50,000
Bond face amount. The premium you pay is priced separately.
Add a bond quote to your dealer insurance application.
Bond requirementsIn Illinois, insurance and licensing requirements depend on your dealer category. Independent used-auto, wholesale, broker, RV, motorcycle, truck and boat businesses can have different requirements. Confirm your license category with Illinois Secretary of State, Dealer Licensing Section.
Insurance and proof of coverage
Dealer liability minimums: $100,000 bodily injury per person, $300,000 bodily injury per accident and $50,000 property damage.
The certificate must identify the dealership business name and location and must not expire before December 31.
UM, UIM and medical coverage
BI means bodily injury. PD means property damage. For example, 25/50 BI means $25,000 per person and $50,000 per accident.
- Uninsured motorist (UM)
- 25/50 BI minimum; higher-limit rules apply
- Underinsured motorist (UIM)
- Required when UM exceeds 25/50 BI
- PIP / first-party medical
- Not required
UM bodily injury coverage is required at no less than $25,000 per person and $50,000 per accident. It normally matches the policy’s higher bodily injury limits unless the insured rejects the additional UM limits. If UM exceeds the statutory minimum, UIM must match the selected UM bodily injury limits. There is no universal $100,000 UM or UIM CSL requirement for every dealer.
Your lease, lender or exposure to a serious accident may call for higher limits. Garage liability does not automatically insure the value of inventory or customers’ vehicles.
The dealer bond is a separate requirement
$50,000 vehicle-dealer bond or qualifying certificate of deposit. Agency says bond is required for the first 60 consecutive operating months, subject to the delinquency/deficiency condition.
The bond amount is its face amount, not the price you pay. A surety prices the bond separately, and you may have to reimburse it for claims it pays. A dealer bond does not replace garage liability or inventory insurance. You can add a bond quote to the dealer insurance application.
State licensing fees
| State fee | Amount |
|---|---|
| New and/or used motor vehicle dealer license | $1,000 |
| Master dealer plate set | $45 |
| Duplicate dealer plate | $13 |
These state fees are separate from insurance and bond premiums. Other licensing and startup expenses may apply. Confirm the payable amount in the current state application or portal.
A practical filing detail
The Secretary of State describes the bond requirement as applying for the first 60 consecutive months in operation, with conditions related to delinquency or deficiency. Do not cancel a bond solely because the business has reached its fifth anniversary; confirm your eligibility.
What does dealer insurance cost in Illinois?
The legal dealer liability floor and a landlord’s required limit can be very different. A lease calling for $1 million in garage liability changes the coverage being purchased. Employee count, plate use, prior insurance and inventory protection also affect the price.
Real quotes issued by our agency, Pro Risk Solutions dba dealership.insure. Your price depends on your dealership and coverage.
| Dealer example | Annual premium | Down payment | Monthly payments | Coverage |
|---|---|---|---|---|
| Illinois Retail used-car dealer Without inventory coverage | $4,150 | $1,100 | 9 payments of $352 | $1 million garage liability limit to meet the landlord’s requirement. Dealer physical damage is not included in this basic-liability example. |
| Illinois Startup dealer Without inventory coverage | $4,600 | $1,100 | 10 payments of $382 | $350,000 garage liability per accident. Inventory coverage not included. |
| Illinois Dealer with inventory coverage Liability + inventory | $15,710 | — | — | $350,000 garage liability per accident. $270,000 inventory limit; $50,000 maximum per auto. Combined liability and inventory policies; flood excluded. |
| Illinois Dealer with inventory and property coverage Liability + inventory | $20,058 | $5,531 | 9 payments of $1,738 | $350,000 garage liability per accident. $500,000 inventory limit; $25,000 maximum per auto. Includes building and business property coverage; inventory flood excluded. |
Illinois $4,150 example: coverage and business details
4 years of prior insurance history · 2 full-time employees · 4 dealer plates · $1 million garage liability limit to meet the landlord’s requirement.
Dealer physical damage is not included in this basic-liability example.
State requirements and official sources
Quoted September 19, 2026.
Illinois $4,600 example: coverage and business details
New business · $350,000 garage liability per accident.
Inventory coverage not included.
$100,000 UM; $50,000 limited tire liability.
$500 property-damage deductible for work performed.
State requirements and official sources
Quoted September 2, 2026.
Illinois $15,710 example: coverage and business details
6 dealer plates · $350,000 garage liability per accident.
$270,000 inventory limit; $50,000 maximum per auto.
$100,000 UM and UIM; $100,000 damage to rented premises; $350,000 personal/advertising injury. Annual premium combines liability and physical-damage policies for the same policy year.
Collision: $1,000 per auto. Other covered causes: $1,000 per auto / $5,000 per event. Theft: $2,500 per auto / $12,500 per event. Wind/hail: $2,500 per auto, with no event maximum. Flood is excluded.
State requirements and official sources
Quoted October 23, 2026.
Illinois $20,058 example: coverage and business details
11 years in business · 2 employees, excluding owners · 7 dealer plates · $350,000 garage liability per accident.
$500,000 inventory limit; $25,000 maximum per auto.
Also includes building coverage of $600,000 actual cash value and business personal property of $75,000 replacement cost. Property deductible: $1,000 for other covered causes; 2% for wind/hail, with a $2,500 minimum. $50,000 UM; $50,000 dealers E&O; $50,000 limited tire liability; $25,000 false pretense per auto.
Collision: $1,000 per auto. Other covered causes: $1,000 per auto / $5,000 per event. Theft: $2,500 per auto / $12,500 per event. Wind/hail: $2,500 per auto, with no event maximum. Flood is excluded.
State requirements and official sources
Quoted October 14, 2026.
Illinois dealer insurance costs and coverage comparison · What affects your insurance premium
Get your dealer insurance quote
Complete the dealer insurance application online. You can add a dealer bond quote in the same application.
Keep reading
Sources & resources
- Illinois VSD 659.12 Instructions for Dealer License, July 2025
- Illinois Secretary of State: Dealers and Remitters
- Illinois DOI: commercial auto and garage form requirements
Policy wording controls actual coverage.