You don't have to have liability insurance to have a business license, for years many Sole Prop business types work with a business license and sellers permit with no insurance whatsoever.
Typically what will force a shady operation into gaining some form of liability coverage would be renting a place as for the most part building owners and landlords will require at lease some form of insurance for you to rent a building or shop space.[/QUOTE
I truly doubt that. Some sole prop business eg financial, book keeping, home cleaner and such
An auto shop cannot be a sole prop business. even if it's owned by the owner out right because of the requirement of licensed mechanics and customer machinery in this case automobiles which requires a job done right for the customers safety.
Current requirements for businesses .Any business that handles customers' vehicles needs garage liability insurance in addition to its commercial general liability coverage. This includes businesses such as repair shops, car dealerships, tow truck drivers and service stations.
To get a barber's license and operate a business you need to have general liability insurance just in case you clip someone's ear. So when it comes to heavy vehicles, speed, and human beings i would be surprised if the state let someone fix cars without insurance but then again i am a reasonable person.