Do Private Valet Companies Need Special Insurance?

Yes. A valet company takes control of other people's cars, so it needs coverage that an ordinary business policy does not provide, most importantly garagekeepers liability for damage to vehicles in its care. As a host, you should also ask for a certificate of insurance that names you before the event.

Why isn't ordinary business insurance enough?

Most general liability policies exclude damage to property that the business has in its care, custody or control. For a valet company, that excluded property is the whole job: every guest car, from the moment the keys change hands until the car is back at the curb. Without coverage written for that exposure, a scraped bumper or a car rolled into a post can fall back on the guest's own auto policy, on the valet company's cash, or on you as the host.

Valet work also puts employees on their feet in traffic lanes, in the dark and in Colorado weather, and puts them behind the wheel of cars they have never driven. Each of those risks calls for its own type of coverage.

What coverage do valet operators typically carry?

• Garagekeepers liability. Covers physical damage to customer vehicles while the valet company has them, including collision, theft and vandalism, depending on the policy. Some forms pay only when the operator is legally at fault; others pay regardless of fault. It is worth asking which form a company has.
• General liability. Covers bodily injury and property damage to third parties caused by the company's operations, such as a guest who trips over equipment at the valet stand or a pedestrian struck by a moving car.
• Workers' compensation. Covers medical costs and lost wages if an attendant is hurt on the job. Colorado requires most employers to carry it, and it matters to you because an injured, uninsured worker may look to the property or host for recovery.
• Hired and non-owned auto. Covers the company's liability when staff drive vehicles it does not own, such as a rented shuttle van or an employee's car used for a work errand. How auto liability applies while driving guest cars varies by policy, so ask the company to explain it.
• Umbrella or excess liability. Many operators add a policy that sits on top of the others for larger claims. Venues and hotels often require one.

What does valet insurance usually not cover?

Every policy has exclusions, and they differ by carrier. Common ones include personal items left inside the car, mechanical failure that was not caused by the valet, and damage that existed before drop-off. Weather damage to cars parked in an open lot is often treated as the owner's own auto claim unless the valet company had a duty to park under cover. This is why good operators walk around each car at drop-off, note existing damage and post signs about valuables.

Why should the host ask for a certificate of insurance?

A certificate of insurance (COI) is the proof. It lists each policy, its limits, its effective dates and the insurer, and it is issued by the company's insurance agent rather than typed up by the company itself. Ask for a certificate that names you, your venue or your property as the certificate holder. Many venues and property managers also ask to be listed as an additional insured on the general liability policy, so check the venue's requirements early and pass them to the valet company when you request a quote.

What should you check on the certificate?

• The named insured matches the company you are hiring, not a different business that will send its people.
• Garagekeepers coverage is listed, not only general liability.
• Workers' compensation is listed.
• The policy dates cover your event date or contract term.
• Your name, or your venue's name, appears exactly as required.

If anything is missing, ask the company to have its agent issue an updated certificate. A legitimate operator can usually turn that around without fuss. For more on how the work itself is kept safe, read Is valet parking safe?

How does VIP Parking Solutions handle insurance?

VIP staffs every assignment with its own employees, not subcontractors, so the company on the certificate is the company running your valet stand. Ask VIP for a certificate of insurance with your quote, and tell us about any venue requirements so the certificate is written correctly.

Planning an event? See event valet in Denver or start with the Denver valet company overview.

Frequently asked questions