What does motor trade insurance cover?
Motor trade insurance covers vehicles that are in your care as part of your business.
The scope of policies varies depending on your business. If you run a repair garage, you’ll likely need accidental damage cover to safeguard you from problems occurring when mechanics are working on a vehicle.
You may want protection from claims made due to the incorrect fitting of parts, which comes under defective workmanship.
You might also need cover for vehicles, either your or your customers, that are kept on your property overnight.
Each motor trade insurance policy is tailored specifically for your business, but a motor trade policy might typically cover:
- Damage to any vehicles or equipment on your premises
- Vehicles that you drive or work on as part of your business - this is known as a road risk policy
- Members of staff driving vehicles as part of the business
- Claims made against you and your workers by members of the public.
What else can motor trade insurance cover?
Motor trade policies can be extended in various ways to meet your needs.
Some cover uninsured loss recovery and motor prosecution defence costs of up to £100,000 per claim, while others cover property and money in transit.
Essential personnel protection pays out for death or permanent disablement of a key person whose absence will interrupt business activities.
Fines and damages cover can be used for non-completion of contracts. Some extensions can even cover public relations expenses in relation to claims.
A lot will depend on the size of the business. Large businesses turning over more than a million pounds are likely to have more complicated needs than a one-man-band.
The most common motor trade insurance policy additions which you might consider, include:
Employers’ liability insurance protects your business against claims from your staff. You should have employers liability insurance if you have employees regardless of whether or not they’re driving vehicles. If they injure themselves at work, your business could be held liable, with compensation costing many thousands of pounds.
Public liability insurance safeguards you and your workers against claims made by customers or members of the public. For example, if someone is accidentally injured in your workplace then they could be entitled to claim a substantial sum in compensation.
Product liability insurance offers your business protection if you fit a new part to a customer’s vehicle, but it subsequently turns out to be defective.
Material damage cover covers any vehicles or equipment you own. For example, if you run a motor dealership it means your unsold vehicles are insured. Such insurance may automatically increase in value during peak registration periods in March and September, although this will obviously depend on the terms of the policy.
Extra drivers as for many businesses, it’s important that their trade policy covers all their staff. But opting for an “any driver” policy is likely to be more expensive than either naming any insured drivers on the policy or limiting cover to just a handful of employees. Either way, it’s worth comparing the various costs to see which is preferable.
Need more help?
These policies are designed for traders with more complicated businesses. For example, they may be ideal if you’re holding a number of vehicles on the premises.
Stock stored will also come under such a scheme, along with portable tools, machinery, and even business interruption insurance.
Whether you need this level of cover will depend on the nature and size of your firm.
Yes, it’s possible to get this cover. These policies are aimed at people who are involved in the motor industry but have a primary occupation elsewhere.
This means individuals selling cars in their spare time, repairing or servicing them on the side, or carrying out some work on vehicles at home.
Most motor trade policies will require you to be over the age of 25, although some will accept you for certain business types from age 23. Getting cover below this age can be difficult, but give us a call and see if we can help.
The younger you are, the more you should expect to pay for cover. It’s similar to younger drivers on normal insurance policies. Their lack of experience on the road means they are classed as higher risk.
Most people over the age of 25 can get access to traders’ insurance for their business without too many issues.
Potential problems can occur with criminal convictions – largely depending on the nature of the offence – and whether they have excessive motoring convictions or bans.