The typical car wash is vulnerable to a large property loss.

For most car wash owners, the concept of risk management begins and ends with the purchase of an insurance policy. But risk management encompasses much more than simply buying insurance.

A true risk management plan involves identifying the risks, eliminating any risks that can be eliminated, controlling the risks that can’t be eliminated, and then insuring or retaining those remaining risks. The basic strategy of any plan should be to retain (self insure) small risks and insure large potentially catastrophic risks.


When a customer incident occurs, the way it is handled is of the utmost importance. Incidents that are handled poorly can result in unhappy patrons, poor referrals, non-repeat business, and sometimes even insurance claims or lawsuits. You can prevent many incidents from escalating into claims and lawsuits if you follow proper incident handling policies.
• Show compassion; listen to the customer
• Obtain a customer incident report form
• Capture the evidence (camera, video)
• Avoid statements that claim responsibility
• If any injury, offer medical assistance and report the incident to your insurance carrier immediately
• Avoid committing to paying medical expenses
One area where most of the losses are likely to occur is damage to the car wash property itself. Ultimately avoiding an incident is best, but at what level should insurance be expected to help pay these losses? Any car wash owner who is working in the role of risk manager should ask these questions:
• Are you maintaining your property and making sure the parking lot, bays, and tunnels are in good condition including attention to snow, ice, oil, and chemicals?
• Do you maintain your equipment and verify daily that all is in excellent working condition?
• Are you training and have clear procedures for all employees?
• Do you record video surveillance on all areas of your property including documenting vehicles before they use the wash for any prior damage?

After an incident occurs and you have developed an accurate and complete description of what happened, the next step is to determine why it happened. The goal is to take or correct actions so a similar accident can be prevented in the future. Your business profitability and reputation benefit from proper incident handling. They are going to happen; they don’t go away on their own so it requires procedures, training, communication, and documentation.


The most important time a car wash owner can spend as risk manager is the time assessing the potential for large losses — those losses of catastrophic nature that can spell financial ruin. Where are those losses likely to come from for a car wash owner? What damage becomes financially catastrophic is different for each car wash owner. Smart loss prevention will not only help minimize the larger type of property damage events but will also hopefully help you open your doors sooner and maybe control future insurance costs.

The typical car wash’s exposure to the elements also makes it vulnerable to a large property loss. High winds can wreck havoc with a self-service car wash. And just because there is a large volume of water at a car wash doesn’t mean it can’t burn. They can and do, usually with devastating results. Also, a large property loss at a car wash usually doesn’t end at the dollar amount for repairing the damaged structure. Often, the dollar value for the amount of income lost while the car wash is down for repairs is greater than the amount for the repairs themselves, which is another area of catastrophic loss that needs to be dealt with.

Any time large numbers of the public are on the premises, as they are at a car wash, there is the potential for someone to suffer an injury on the premises who will try to claim negligence on the part of the property owner. Some of these claims are legitimate, and some are not, but they all carry the potential of turning into a large claim — even if only from the high cost of defending oneself. Public liability is a huge area of concern with the potential for a large loss. Be sure you have clearly posted the areas the public should not be in (inside the tunnels, lube bays, equipment room, etc).


There are many losses over which car wash owners have no control. However, with some forethought, losses can be prevented or diminished. If minor damages occur, repairing them as soon as possible could prevent further damage to the property. Some examples of the steps that can be taken to help minimize losses are:
• If your building has a flat roof, routine maintenance could help prevent leaking or collapse.
• What about vehicles running into the building? Have you installed height guards and bollards to alert the driver or possibly stop an actual collision with your building?
• Keep the interior and exterior of the premises well lit at night.
• Consider installing security alarms and cameras.
• Keep all doors locked when the wash is not attended.
• Keep the amount of onsite cash to a minimum.
• Make daily bank deposits; vary your time and routes to the bank.
• Heating the floors of the car wash bays would greatly reduce the hazard of icy floors while keeping the car wash operational.


Another area of concern for car wash owners is Workers’ Compensation. Even though each state has different laws regarding whether or not you are required to purchase coverage, you are still legally responsible for any injury to an employee.

Establishing a safety culture in the workplace is a team effort that can impact the profitability of the company by reducing the money and time spent on accidents, improving morale, and increasing productivity. Successful safety programs should include some of the following basics:
• Management’s Safety Policy
Prepare a brief written statement of management’s commitment to the safety and well being of employees.
• Training
Training procedures provide an established way to perform a job or function. It enforces safe and efficient work habits and should be continually monitored to correct any change in habits which could result in injury.
• Hazard Recognition and Control
Perform self-inspections of the workplace to correct or eliminate any hazards, and notify all employees of corrections made.
• Accident Investigation
Investigate all accidents, large and small, to identify possible trends. Identify causes of accidents, provide corrective actions, and determine how to help prevent or eliminate future accidents.
An effective safety program should include written documents that detail responsibilities, rules, and policies. Putting the program in writing provides structure and consistency in accident-prevention efforts. Keep records covering employee training, safety meetings, workplace inspections, hazard corrections, and accident investigations. Occupational injuries or illness other than first aid should be recorded for OSHA recordkeeping purposes. Recordkeeping helps identify existing and potential safety risks and ways to minimize them.


Risk management for a car wash is more than buying insurance. It is a process of identifying, eliminating, and controlling a financial risk. Because the car wash industry has so many unique exposures, it is vital that the car wash owner deal with an insurance agent that understands the industry and can place coverage in a special insurance package designed specifically for car washes.

When the risks have been identified and eliminated as much as possible, the remaining risks must be handled in some way. Some will be insured and some will be retained, but the decision should be an educated conscious one by the car wash owner. This is where a well-designed insurance program can provide the backbone for a good risk-management plan.

Cindy Helvey and Robin Paroubek have been account service managers with The Insurancenter Car Wash Program in Joplin, MO for over 20 years.

The typical car wash is vulnerable to a large property loss.