What could happen if a dealership fails to maintain the required insurance?

If a dealership fails to maintain the required insurance, one significant consequence is that it can lose its license. Maintaining proper insurance is a fundamental requirement for operating a dealership, as it protects both the business and its customers against potential liabilities. The Virginia DMV enforces strict licensing standards to ensure that dealerships are financially responsible and capable of handling incidents that may arise during vehicle sales or in the operations of the business. Without adequate insurance, the dealership poses a higher risk not only to itself but also to the public, which can lead to a revocation of the license to operate. This measure ensures consumer protection and upholds industry standards.

While other outcomes like fines or restrictions on operations may also be possible consequences of failing to maintain proper insurance, the loss of the dealership's license is a critical and immediate effect, highlighting the importance of compliance with insurance requirements in the automotive sales business.