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A Beginners Guide to Motor Trade Insurance

Motor trade insurance is often seen as vital cover to have if you work in any business that is related to car industry. If you’re a car dealer or someone who owns and runs a garage having some sort of trade cover is a must. Furthermore, it is a legal requirement for you to be sufficiently insured once you are professional involved in the motor trade.

Below is a list of business where having motor trade cover would be recommended:

If you run a business that deals with vehicle repairs
If you run a business that buys and sells vehicles for profit even if you are individual part time trader.
Businesses that provide car breakdown and recovery services.
Garages that provide car or motor vehicle servicing or MOTs.
Businesses that offer vehicle delivery services.
Specialist vehicle restorers or repairers.
Businesses that provide vehicle repossession services.
Scrap Yards
Businesses that offer car valeting services.
Businesses that fit or sell vehicle parts and accessories.

There are various levels of cover available to those working in the motor trade depending on the nature of your business will depend on what level of cover you need. Let’s explore the diverse types and levels of cover:

Essentially there are three different types of motor trade insurance, road risk, liability and combined.

Road Risk

Road Risk insurance is suitable for those who drive vehicles that do not belong to them on a regular basis. An example of businesses that may opt to only have road risk insurance are businesses that services cars and therefore needs to road test the vehicle before returning it to the customer. Road Risk cover can be broken down into three distinct levels of cover:

Third Party Only

Third Party Only is the lowest level of road risk insurance cover you can purchase. It will cover you for any loss, damage or injury caused to a 3rd party when you are driving. Being covered 3rd party means it will cover other people’s vehicles and possessions but not your own. However, passengers in your vehicle may also be covered.

Third Party Fire and Theft

This type of road risk policy would cover everything listed in Third Party Only cover with the additional protection of being insured for any damage relating to damage or arson with regards to vehicles under your custody and control.

Fully Comprehensive

Comprehensive cover, also known as fully comp is the highest-level road risk cover you can purchase. It covers you for all that we have mentioned so far in both the third party and third-party fire and theft sections of this beginner’s guide. However, with fully comprehensive cover you are insured if you damage your customers car and your insurer will pay out for any necessary repairs if it is your fault.

Liability Insurance

Liability insurance will provide you with insurance cover in the even that a customer, employee or any other visitor to your business suffers harm or loss due to negligence or unsafe conditions in the workplace. It will cover you and pay for any fees incurred if a third party should take you to court, for example for a personal injury claim.

There are three types of liability insurance that should be considered if you work in the Motor Trade:

Public Liability Insurance

Public liability insurance covers you in the event that one of your customers or another visitor to your premises has an accident or injures themselves as a direct result of your negligence. The insurance will pay out compensation to the 3rd party involved should they successfully sue you.

Product Liability Insurance

Product liability insurance provides you with cover if accident, injury or damage occurred as a direct result of you, for example fitting a fault part to you customers vehicle.

Employer’s Liability Insurance

Employers liability insurance provides you cover for your employees. If any of your employees were to be injured whilst at work or worst die you will be sufficiently insured should any negligence claim be brought against you or your business.

Combined Motor Trade Insurance

A combined motor trade policy generally provides the highest level of comprehensive cover if you work in the motor trade. It will provide cover for your vehicles, money, premises, tools and often includes public liability, product liability and employee’s liability as standard. It really is the most comprehensive policy for your business providing you with complete peace of mind.

Read more about motor trade insurance in on our Motor Trade Frequently Asked Questions page.


In summary, Motor Trade insurance can be a complex subject, with many different levels of cover and options to choose from. At UtilitySavingExpert.Com we aim to try and make things an easy for you whether it is the first time you are purchasing a trade policy or if you are a season trader. We offer a specialist quotation tool with one short form to complete which enables to you get quotes from multiple insurers. Once you have your quotes we recommend that you speak with each insurer directly and discuss your individual business requirements as no two businesses are the same and, often the policies can be tailored your individual needs.

Don’t forget that by using Utility Saving Expert’s motor trade insurance quotation tool, you are indirectly donating to charity too. As a socially-conscious business, Utility Saving Expert donates 10% of its net yearly profits to charities that fight fuel poverty.