If you park your car with a valet and it gets damaged, the parking/valet company will be at fault.
“Ultimately, if the car owner were to turn over his keys and while under the care, custody and control of the valet … his car was damaged, then the valet company would be responsible,” says Chris Hackett, spokesperson for the Property Casualty Insurers Association of America (PCIAA), an insurance industry organization.
How do the coverages work for parking lots and valets?
Depending on the type of insurance the parking company has, you might even be covered if the valet is not at fault. Parking operators carry one of two types of “garage keepers” liability insurance, says Kathy Phillips, senior vice president with Alliant Insurance Services, a national brokerage firm based in Newport Beach, Calif., which specializes in placing insurance for parking companies and other businesses.
The types of coverage are:
- Direct and primary insurance obligates a parking company’s insurer to fix damage caused when your vehicle is in the hands of a parking valet, regardless of who is at fault.
- Legal liability insurance covers only damage caused when a valet is negligent.
For example, if the valet’s employer has legal liability insurance and an employee is rear-ended while driving your car, the parking lot company’s insurance will not pay. But if the company’s insurance is the direct-and-primary type, you’re covered no matter who is to blame. In that case, the parking company’s insurance pays up, decides who was at fault, and reimburses the other driver’s insurance if necessary.
Will your insurance pay?
States don’t require parking companies to have insurance. Some cities do, but others do not. Los Angeles, for example, requires a police permit, business license, insurance and a parking lot license bond from parking company operators, Phillips says. Other cities may regulate parking lot companies only where they operate on public property.
Occasionally, customers must make claims on their insurance to cover damage from a valet.
“If it turns out that the valet company is bankrupt or had insufficient funds, there would be coverage under your own auto insurance,” Hackett says.
Of course, that assumes you carry collision coverage.
If you do have it, you can make life easier by filing the insurance claim on your own policy and letting your insurer pursue the parking lot company for reimbursement. In that case, you’ll have to pay the deductible, but you’ll get it back from your insurer if the valet or parking company is at fault.