If an employee test-drives a customer's vehicle under the insured's garagekeepers insurance and causes an accident, what is the coverage outcome?

When discussing the scenario where an employee test-drives a customer's vehicle and causes an accident under garagekeepers insurance, it is important to focus on how this type of insurance is structured. Garagekeepers insurance provides coverage for customers' vehicles while they are in the care, custody, or control of the insured, typically seen in auto repair shops or service stations.

In this case, the customer's vehicle is indeed covered for physical damage resulting from the accident caused by the employee's action. Garagekeepers insurance is designed to protect the vehicle owner against losses that occur while their vehicle is being serviced, which includes incidents like an employee test-driving the vehicle. Therefore, the customer's vehicle is protected under the insured's policy during such situations, affirming that the physical damage incurred during the test drive is indeed covered.

This outcome ensures that the vehicle owner does not bear the financial burden of damages that occur while their vehicle is in the possession of the insured business, aligning with the fundamental purpose of garagekeepers insurance.