Only partly. A restaurant’s general liability policy usually covers injuries to other people caused while your staff parks customer cars on or next to your premises, but it excludes damage to the customers’ cars themselves, because those cars are in your care, custody or control. Covering the vehicles takes garagekeepers coverage, or a valet contractor that carries its own and names you as an insured.
Valet is common at fine dining rooms, steakhouses, event venues and busy urban restaurants with little parking. Whether you run valet with your own staff or hire a valet company changes who pays for what, so it’s worth sorting out before the first dented bumper.
What general liability does and doesn’t do for valet
The ISO commercial general liability form (CG 00 01) excludes injury and damage arising out of the use of any auto operated by any insured, which includes your employees. There is a narrow exception for parking an auto on, or on the ways next to, premises you own or rent, as long as the auto isn’t owned by, rented or loaned to you. So if your valet hits a pedestrian while parking in your own lot, GL generally responds. If the cars go to a lot several blocks away, that exception may not apply.
Separately, GL excludes damage to personal property in your care, custody or control, which is exactly where a customer’s car sits once you take the keys. Hired and non-owned auto liability can help with injuries to others when employees drive vehicles you don’t own, but it is liability coverage, not physical damage coverage for the customer’s car, and some forms limit valet use. The details depend on your policy wording; compare hired and non-owned auto vs. commercial auto.
Garagekeepers coverage and valet contractor requirements
Garagekeepers coverage pays for physical damage to customers’ vehicles while they’re in your care for parking. It can be written on a legal liability basis, which pays only when you are legally responsible, or on a direct basis, which pays regardless of fault. You choose comprehensive (theft, vandalism, fire, falling objects) and collision separately, each with its own deductible. Personal items left inside the vehicles are commonly excluded or limited.
If you hire a valet company, the contract and certificates do most of the work. Require evidence of commercial general liability, garage or auto liability, garagekeepers limits for each location, workers’ compensation for the attendants and an umbrella. Ask to be named as an additional insured by endorsement, not just on the certificate, along with a waiver of subrogation and a hold-harmless clause in the service agreement. Re-check certificates at every renewal; see restaurant certificates of insurance.
Two valet claims, two different outcomes
Scenario 1: the pillar in your own lot. An in-house valet at a Scottsdale steakhouse backs a guest’s SUV into a concrete pillar in the restaurant’s lot. GL does not pay for the SUV because it was in the restaurant’s care, custody or control. With garagekeepers collision coverage, the repair is paid, less the deductible. Without it, the owner pays directly to keep a regular happy.
Scenario 2: the garage three blocks away. A Boston fine dining restaurant uses a valet company that parks cars in a garage three blocks away. Running a red light on the way, a valet hits a cyclist, who sues both the valet company and the restaurant. The valet company’s auto and garage liability should respond first, and if the restaurant is an additional insured, that coverage defends the restaurant too. If the valet company’s insurance had lapsed, the restaurant’s own program would be tested — GL’s parking exception doesn’t reach an off-site garage, so hired and non-owned auto and umbrella wording would matter.
Valet risk checklist
- Who parks the cars — your employees or a contractor; the insurance structure is different.
- Where the cars go — on or next to your premises, or an off-site lot or garage.
- Garagekeepers limits — per vehicle and per location, sized for the most expensive cars you park.
- Legal liability vs. direct basis — direct basis avoids arguing fault with a regular customer.
- Comprehensive and collision — carry both; theft and door dings are as common as collisions.
- Hired and non-owned auto liability — for injuries to others when staff drive customers’ cars.
- Valet contractor certificates — liability, auto, garagekeepers, workers’ comp and umbrella, verified annually.
- Additional insured and waiver of subrogation — by endorsement, for you and your landlord.
Frequently asked questions
Does a ‘not responsible for damage’ sign protect my restaurant?
Rarely completely. Valet parking is generally treated as a bailment, and disclaimers often don’t override negligence; enforceability varies by state. Insurance, not signage, is the real protection.
Is a customer’s car stolen from valet covered?
Garagekeepers comprehensive coverage covers theft of customer vehicles in your care. General liability does not.
Do I still need garagekeepers if I hire a valet company?
Not always, if the contractor carries adequate garagekeepers and you’re protected by contract and additional insured status. Many restaurants still carry some as backup in case the contractor’s coverage lapses or runs out.
Does my commercial auto policy cover valet?
A business auto policy covers autos you own, hire or borrow, not customers’ cars left for parking. Garagekeepers can be added to some policies; see do restaurants need commercial auto?.
Starting valet service or renewing a valet contract? We’ll review the contract’s insurance requirements and quote garagekeepers alongside your restaurant program. Provident Financial Group is an independent agency: you complete one application, we compare multiple carriers side by side, and you get live certificates of insurance to share with landlords and venues. Call (866) 964-6660 or Get Multiple Quotes within minutes.