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Free Resource · NJ Dealer Insurance

Is your dealer policy
actually MVC-compliant?

Most NJ used car dealers don't find out their policy is wrong until a claim is denied. This 15-point checklist — built from 40 years of dealer submissions — tells you exactly where to look before your next renewal.

Free: The NJ Dealer Insurance Compliance Checklist

Get the 15-point policy audit for NJ used car dealers.

Verify your garage form, symbols, garagekeepers, and open-lot limits before your next MVC renewal — in about ten minutes. Enter your name and email and we'll send your access link.

We'll send the checklist plus a short series on the coverage traps that catch NJ dealers. Unsubscribe anytime. Educational only — does not amend coverage; refer to the policy and applicable law.

NJ Used Car Dealer Insurance Compliance Checklist

15-point policy audit — review before every renewal

Section 1 — Policy Form & MVC Compliance

These are license-threatening gaps. Verify before renewal.

My policy is a garage form — not a BOP or commercial general liability policy Critical
Under N.J.S.A. 39:10-19, the MVC requires a garage liability policy as a condition of dealer licensure. Standard BOP/CGL forms contain automobile exclusions that void coverage for dealer operations. Check your declarations page — it should say "Garage Policy" or "Commercial Garage."
My policy is with an admitted carrier licensed in New Jersey Critical
The MVC will not accept surplus lines certificates for dealer licensure in most cases. Verify your carrier's admission status on the NJDOBI website before renewing your license.
My certificate of insurance correctly names NJ Motor Vehicle Commission as the certificate holder
The MVC requires a specific certificate format for dealer license renewal under N.J.A.C. 13:21-15. The certificate holder field must read exactly as the MVC requires — generic certificates are rejected.

Section 2 — Commercial Auto & Dealer Plates

The most commonly denied claims in dealer programs.

My commercial auto section uses Symbol 21 (any auto) — not Symbol 7 Critical
Symbol 7 covers only owned, titled vehicles. Dealer plates are not titled to the dealership — they are registration instruments placed on inventory. Symbol 7 does not cover test drive accidents, employee use of plate vehicles, or transport. This single gap causes more denied dealer claims than any other.
Test drives and off-premises road tests are explicitly covered
Some garage policies restrict coverage to premises operations. An accident during a test drive a mile from the lot may fall between the garage liability (premises) and commercial auto (wrong symbol) sections. Confirm your policy explicitly addresses off-premises test drives.
All driver information is current and all drivers are scheduled or listed
Unlisted drivers who cause accidents are frequently a basis for coverage disputes. Maintain a current driver list with DOB and license number. Update within 30 days of any hiring or termination.

Section 3 — Garagekeepers & Open Lot

Two separate coverages. Both are required.

My garagekeepers form is direct primary (not legal liability) Common Gap
Legal liability form requires a finding of your negligence before the insurer pays a customer's vehicle loss. If a customer's car is stolen from your lot with no evidence of negligence, a legal liability form may pay nothing. Direct primary pays without the liability finding. Most dealers should be on direct primary.
My garagekeepers limit equals the total value of all customer vehicles on premises at peak
Calculate your worst-case scenario: how many customer vehicles are on your lot on a busy Friday? What are they worth? A limit set at one vehicle's value, or at an average rather than a peak, is inadequate for a fire or theft event that takes the whole lot.
My dealer open lot limit covers my peak inventory value
Dealer open lot (inventory physical damage) and garagekeepers are separate coverages. Open lot covers your inventory; garagekeepers covers customer vehicles. Both limits must reflect actual peak exposure — not average or last year's numbers.
All floor plan lenders are listed as loss payees on the correct endorsement
Banks that provide floorplan lines require loss payee status on your dealer open lot policy. A mismatch between your lender list and the endorsement can delay or void claim payments — and trigger a default on your floor plan agreement.

Section 4 — Liability, Umbrella & Specialty

My commercial umbrella follows form with the garage policy
An umbrella with exclusions that conflict with your primary garage policy provides no real protection for your largest exposures. The umbrella must be placed with a carrier that will follow the garage form — not a generic commercial umbrella that excludes automobile operations.
I have pollution liability if I store fuel, oil, or have underground tanks Common Gap
Standard garage policies contain total pollution exclusions. A UST leak, oil spill, or refrigerant release creates environmental cleanup liability that can exceed $1M. If you have any on-site fuel storage, fluid handling, or underground tanks — check for a standalone pollution policy.
I have F&I E&O coverage if I sell extended warranties, GAP, or service contracts
The FTC Used Car Rule (16 CFR Part 455) creates disclosure liability. Standard garage E&O does not cover F&I product misrepresentation. Dealers who place any financing or insurance products need a separate F&I errors and omissions policy.
I have cyber liability coverage for customer financing data Common Gap
F&I operations collect SSNs, credit applications, and bank information. The NJ Identity Theft Prevention Act creates notification and remediation obligations after a breach. Garage policies do not cover cyber liability. A standalone cyber policy is required for any dealer processing financing applications.
Questions? Call now — you'll reach Tom directly.
Tom Heuston — independent specialist broker since 1985.
609-812-1962 · info@heustons.com
Mon–Fri 8:30 AM – 4:30 PM ET · Summer Fridays until 1 PM · Closed holidays (early close the day before)
23 Maryland Road, PO Box 278, Tuckerton, NJ 08087 · Licensed NJ · PA · NY · USVI
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Complete dealer programs — garage liability, garagekeepers, open lot, commercial auto, umbrella, workers comp. ACORD-based submissions to admitted and surplus markets.
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This checklist is for general informational purposes only and does not constitute legal, tax, or insurance advice. Coverage determinations require analysis of the actual policy as issued. Heuston's Insurance Services LLC is an independent brokerage — policies are issued by and obligations are the responsibility of the issuing carriers. © 2026 Heuston's Insurance Services LLC.

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