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Motor Trade Insurance – Ultimate Guide
If you work in the motor trade, you need to know about . It’s a big and complex subject and you need to know your way around it if you’re going to get the best trade insurance quote for your business. This guide is here to help.
We will cover frequently asked motor trade insurance questions such as:
If you need to compare motor trade insurance quotes for your business, check out the insurance comparison tool on our site. It gives you access to a whole range of quotes for your business that covers the leading vehicle trade insurance brokers. It’s quick and easy to get an online quote within minutes.
As a motor trader, you may also wish to consider a fleet insurance policy.
Motor Trade Insurance – What is it?
What is motor trade insurance and how does it work?
Traders insurance is needed by any business working in the motor trade industry. At its most basic level it gives your business and employees the cover you need for your own vehicles or your customers’ vehicles (when the vehicles are in your care) to be road-legal.
Beyond that, each motor trade insurance policy is tailored to your business’s requirements, so you can get precisely the level of cover you need. For example, if your business is in motor sales you can get cover for the vehicles you sell.
If your business involves what is known as the ‘care, custody and control’ of your customers’ vehicles (e.g. mechanic), the motor trade insurance policy protects your business and your employees while the vehicle is with you. You can also get cover for the premises you work from and any stock you carry.
Motor Trade Insurance – Who needs it?
Motor trade insurance can be divided into two parts (note that these two parts sometimes overlap). The size of your business does not matter – you still need motor trade insurance if you work in the motor trade part time.
Neither do you need to have premises to have a motor trade insurance policy – you still need insurance even if you run your business from home or go to customers’ home or place of work to carry out the work you do.
Motor Trade Insurance – Business Example 1
The first type of business that needs motor trade insurance is one that buys, sells or hires vehicles, such as car showrooms, car traders, auction houses, vehicle importers, classic car specialists, scrap and salvage merchants, vehicle repossession businesses and car hire companies.
It will need to cover the vehicles you are buying and selling and give you and your employees cover when you drive them.
Motor Trade Insurance – Business Example 2
The second type of business that needs motor trade insurance are those that have their customers’ vehicles under their, ‘care, custody and control’. This refers to situations when a customer leaves their vehicle with you or when you work on your customers’ vehicle.
When a customer leaves their vehicle with you it is no longer protected by their insurance, so you need to have your own motor trader’s insurance to cover it. As well as protecting the customers’ vehicle, it also covers anyone working on the vehicle or driving it.
Examples of businesses that need motor trade insurance are those that have customers’ vehicles under their care, custody and control and need cover include repair centres, MOT centres, mechanics, mobile repairers such as exhaust, tyre and windscreen fitters, vehicle delivery companies (who will also need trade plates) and companies that park customers’ vehicles on their behalf.
Compare all the leading motor trade insurance providers at Utility Saving Expert.
Motor Trade Insurance – Types of policies
Third Party Only – Motor Trade Insurance- Third Party, Fire and Theft – Motor Trade Insurance
- Comprehensive – Motor Trade Insurance
Policy Types
Motor trade road risk insurance
This is the type of motor trade insurance cover you need if you are going to take your vehicles or your customers’ vehicle on the road.
Motor trade liability insurance
The cover you need to protect your vehicles, the vehicles in your care, your trade premises and your employees.
Combined Motor trade insurance
You can also choose to take out a combined motor trade insurance policy – this combines road risk insurance and liability insurance and provides additional cover too.
Road Risk – Motor Trade Insurance
Road risk motor trade insurance covers your vehicles and your customers’ vehicles when they are on the road under your care. It provides the cover you need in the event of an incident or accident.
If you do not take your customers’ vehicles on the road, you can consider taking out parts only cover. This is a very basic form of trader’s insurance and you would not legally be covered if you take your customers’ vehicles out on the road.
Like ‘standard’ car insurance, there are three options when it comes to road risk traders insurance, if you take vehicles onto the road as part of your business:
Third Party Only – Motor Trade Insurance
Third party only is the most basic level of motor trade insurance that legally allows you to take your vehicles and your customers’ vehicles out on the road. It is typically the cheapest level of motor trade insurance cover
It is the minimum level of cover you need if you:
Repair, service or restore vehicles- Are a vehicle fitter, mobile tuner or valeter
- Run an MOT centre or garage
- Buy and sell vehicles for profit
- Drive your own vehicle or customers’ vehicles
- Have any of your vehicles or your customers’ vehicles on your business premises or at your customers’ or your home addresses.
With third party cover, your motor trade insurance covers any driver named on your policy to drive any trade vehicles in relation to your business. In the event of an accident that is your driver’s fault, you are covered for damage to the other party’s vehicle and injury to the other party.
It does not cover damage to the vehicle your driver was driving or for injury to your driver. Neither does it cover your vehicles or your customers’ vehicles if they are damaged, involved in a fire, lost or stolen.
Third Party, Fire and Theft – Motor Trade Insurance
Third party fire and theft cover is typically the mid-priced option when it comes to motor trade insurance.
This type of motor trade insurance cover gives you third party protection. It also gives you cover if your trade vehicles or your customers’ vehicles are damaged, involved in a fire, lost or stolen.
Comprehensive – Motor Trade Insurance
Comprehensive is typically the most expensive type of motor trade insurance policy. It provides all the cover that third party fire and theft gives you. It also covers:
Your trade vehicles or your customers’ vehicles if they are involved in an incident or accident that is your driver’s fault
If your driver is involved in an accident that is their fault.
Motor Trade Insurance – Liability
Public Liability Insurance- Employers’ Liability Insurance
- Product Liability Insurance
- Combined Motor Trade Insurance Policies
- Other types of vehicle cover for Motor Traders
Motor Trade Insurance – Liability Insurance Examples
Public Liability Insurance
If you have premises that your customers visit, as a motor trader you should consider public liability insurance. This type of insurance covers you if one of your customers is injured in an accident while they are on your premises.
It can also cover you if one of your customers has an accident that was caused by defective workmanship by you or one of your employees on a vehicle that was worked on.
Employers’ Liability Insurance
If you have one or more employees then employer’s liability is a legal requirement as a motor trader. It covers you and your business if one of your employees is injured or dies whilst at work.
Product Liability Insurance
Product liability gives you cover if a part you fit to a customer’s vehicle turns out to be defective and causes an accident or incident as a result. It allows your insurer to sue the manufacturer of the defective part.
Motor Trade Insurance – Combined Policies
These combine road risk insurance and liability insurance. It also provides cover for things such as your business premises and tools. It is the most comprehensive type of trader insurance policy you can get and provides cover for almost every aspect of your motor trade business under one policy.
Other types of vehicle cover for Motor Traders
There are a number of optional extras you can add to your motortrade insurance cover. These can include motor trade legal expenses, breakdown cover and even part-time car trader insurance policies.
Motor Trader Insurance – How to get a policy?
Check that you are eligible, you must meet the following criteria:
You must hold a full UK driver’s licence.
Evidence that you work in the motor trade industry – you can provide receipts for activities you have carried out such as vehicles you have bought or sold or vehicles you have worked on.
It’s quick and simple to get an online motor trade insurance quote with Utility Saving Expert. We compare all the leading providers to help you find the most competitive price.
Motor Trade Insurance –
How much does it cost?
Motor Trade insurance policies will vary depending on a number of different factors.
Factors affecting your motor trade insurance premium
Vehicle types will affect your motor trade insurance premiums. If you sell or work on high performance vehicles or classic vehicles, you can expect to pay a premium on your insurance.
Driver age is another rating factor that affects your motor trade insurance premium. Younger drivers will see higher prices, insurers may therefore exclude drivers under 25 from your trade insurance policy or charge a higher premium to include them.
The same applies to drivers with points on their licence. It is possible to get trade insurance if you or your drivers have motoring convictions or points on your licence, but you are likely to have to pay a higher premium for it.
Your location will play a role in how much your motor trade insurance will cost. Inner city businesses are likely to face a higher premium for their insurance than businesses in a rural location. This is because inner city businesses are seen as a bigger risk. Buildings with better security are likely to see discounts on their premium.
Motor Trade Insurance –
How can I save money?
Tips to save money on your motor trade insurance premium
Compare a number of motor trade insurance policies- Only get the trader insurance cover you need
- Avoid unnecessary optional extras
- Agree to a higher voluntary excess
- Have better security on your premises
- Hire employees who prioritise safe driving
- Pay your motor trade insurance premium annually rather than monthly
Compare Motor Trade Insurance
We now know what to look for when buying motor trade insurance. It’s time to get the policy that’s right for you.
We compare all the leading motor trade insurance insurance providers, it’s quick and simple to get a no obligation quote within minutes.
Motor Trade Insurance
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Motor Trade Insurance Disclaimer
Utilitysavingexpert.com Ltd uses motor trade insurance quotation technology provided by SEOPA Ltd to enable you, the user to obtain multiple motor trade insurance quotes. These motor trade insurance quotes are sourced from a carefully selected panel of motor trade insurance providers. SEOPA Ltd are authorised and regulated by the financial conduct authority (313860) and their permitted business is insurance mediation.
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