Which loss is typically covered under the physical damage section of a garage policy?

The answer is related to the nature of coverage provided under the physical damage section of a garage policy. This section is designed to protect against various types of damages that can occur to vehicles held for sale or located on the garage owner's premises.

Damage to a covered auto by vandals on the garage owner's lot is a scenario where the physical damage coverage applies. This type of vandalism represents a direct loss to a vehicle that is within the control of the garage owner and is part of their operations. Coverage under physical damage policies would typically include losses resulting from vandalism, such as graffiti or intentional damage, as it affects the vehicle's physical integrity and marketability.

In contrast, the other options represent circumstances that generally fall outside the protections offered by a garage policy's physical damage section. Damage while racing a vehicle typically involves exclusions related to the use of the vehicle in a manner that is not consistent with normal operation. The loss of a vehicle's value after repair addresses economic depreciation, which is not typically covered in physical damage policies — they focus more on the cost to repair or replace the vehicle rather than its market value post-repair. Damage during a test drive over 100 miles might exceed the terms and conditions of both the coverage and permissible use of vehicles under