Motor Trade Insurance

Do I need motor trade insurance cover?

Depending on the type of motor trading business you run, if you operate without having the appropriate insurance in place, you could be breaking the law. For some businesses though, it is not a legal requirement to have any insurance in place, so it’s worth checking what applies for your business.

However, regardless of whether having motor trade policies is mandatory or not, if you run a motor trade business, it’s always worthwhile taking out a policy to make sure you’re properly covered. Without having the right protection in place you and your business could be left vulnerable when things go wrong and claims are made.

What levels of motor trade insurance are there?

• Third-party - In the UK, you’re legally required to at least have third-party cover in order to drive on public roads. It’s the minimum level of cover that you can get.
• Third-party, fire and theft - does everything that third-party does, but also provides you cover in the event that any vehicles on your policy are damaged by a fire or theft.
• Comprehensive - offers the highest level of protection available. It provides all the cover that third-party and third-party, fire and theft offers, but also against any accident damage

What is motor trade insurance?

Motor trade insurance refers to range of different motor-related policies, each capable of providing coverage to businesses and people operating in the motor trade industry.

Anyone that works in the motor trade industry will have access to several vehicles, whether that be their own or their customer vehicles, and they’ll need to be able to repair and drive them to and from their premises easily. Motor Trade insurance enables that, and provides cover against the risks that are associated with the repair work that goes into fixing and altering their customer’s vehicle, as well as having to drive or deliver them to wherever they need to be.

Ultimately, anyone working in the motor trade industry can benefit from a motor trade policy because of the all-round protection and support it can provide.

Who needs motor trade insurance?

There’s a wide range of businesses and individuals that not only NEED motor trade insurance but could also benefit from it.

Motor traders

Professionals that buy and sell cars, perhaps as part of a car dealership, need motor trade and liability policies.

Mechanics

Whether you work in a garage or as a mobile mechanic, motor trade cover can protect all aspects of their business.

Valeters

Valeting and detailing involves working on a car that’s not your own. If an accident were to happen, motor trade insurance could have your back.

Body shops

As soon as someone’s else vehicle is in your hands, your liable. Getting the right insurance can allow you to work and be creative without the fear of making a mistake.

Scrapyards

Scrapyards, as businesses premises go, are full of danger and hazards and need motor trade insurance protection like no other business.

Breakdown & Recovery

Towing, transporting or repairing third-party vehicles are all part of breakdown and recovery services, and being liable comes with wide range of risks.

Vehicle deliverers & collectors

Are you paid to move vehicles? Motor trade cover can give you peace of mind while working with vehicles that aren’t your own.

MOT centres

Mistakes can happen, even whilst an MOT is being conducted. Having the right cover in case could be useful when the unexpected happens.

Tyre fitters

While customers rely on tyre fitters to keep their cars on the road, tyre fitters can rely on motor trade cover to protect their business.

Is your trade or business not mentioned above? That’s okay – Howden can provide cover for a wide range of motor trade businesses and professionals.

Can anyone get motor trade insurance?

Yes, anyone can get their hands on motor trade insurance quotes.

However, to qualify for a motor trade insurance policy, you need to have proof that you work within the motor trade industry. There’s a range of documentation that you could provide insurers as proof, including:

• A copy of your Company letterhead and logo.
• Business advertising
• Business bank account details.
• Purchase and Sale receipts of vehicles or mechanical work carried out.
• V5 registration documents.

Types of motor trade insurance

There are three stand out types of cover that, normally, make up an overall motor traders insurance policy. These are:

Road risk insurance

Road risks cover protects traders from the road risk aspects of running a motor-related business. For example, if something were to go wrong whilst transporting a customer’s vehicle, road risk cover could keep you financially protected.

Because this insurance only covers a smaller part of running a motor trading business, when bought on it’s own, it’s cheaper than paying for an all-round, comprehensive policy.  

Liability insurance

Every business needs to be backed by various different forms of liability insurance in order to run smoothly. Whether it be public liability, employers’ liability or professional indemnity cover, liability insurance products are designed to protect you from claims, whether they’re made by employees, clients or partners, and the legal fees that come with defending your business.

What if an employee has an accident whilst working and can’t work for a while? Or a client’s car is damaged by a mistake made by your business? Liability cover can keep protected in these scenarios and many more.

Combined motor trade insurance

The combined motor trade cover option is, understandably, the most comprehensive type of motor trade insurance. Combining road risk protection will various different liability or more specific insurance products, combined cover provides an all-round insurance protection. You’d need to discuss with your insurer which products you’d like to include in your overall insurance package.

Your policy could include various additional covers as standard. It will depend on the insurer though, as some providers may charge you an extra fee to add an extra cover type whereas others might offer to add it to your policy for free.

Here are those additional insurance products you could add, or already have included, in your policy.

• Public liability insurance
• Employers’ liability insurance
• Business premises cover
• Personal accident insurance
• Business interruption insurance
• Breakdown cover
• Goods in transit cover
• Haulage, couriers and transport insurance
• Legal expenses cover
• Non-Standard Road Risks Insurance
• Classic Motor Trade Insurance
• Classic Vehicle Club Insurance
• SME Motor Trade Insurance
• Self Drive Hire Insurance

Be sure to talk to your insurance provider and check policy details to see exactly what you do and do not have included in your motor trade insurance policy.

How much does motor trade insurance cost?

How much your motor trade insurance will cost will depend on a wide range of factors. There’s no such thing as a one size fits all policy, which means that insurers will need to consider that every policyholder is different and unique when calculating policy premiums. Insurance providers also have their own T’s and C’s to consider which can also impact the prices of policy premiums.

All in all though, what we can say is that, typically, the cost of a motor trade insurance policy will depend on:

• The age of the policyholder – it’s well-known that younger people are usually charged with higher premiums.
• The experience of the policyholder – longevity in the motor trade industry is deemed to be more reliable and less likely to be involved in accidents or at risk.
• The types and level of cover opted for – typically, the more comprehensive the overall policy is, the more expensive the policy quote will be.
• The policyholder’s claims history – cleaner records when it comes to claims will normally be rewarded by insurers with cheaper premiums.
• The nature of the business – some trades are deemed to be linked to more risks and accidents than others, which impacts premium costs.

We always remind our clients that each insurer is different and will each have their own way of calculating policy premiums. Therefore, it’s wise to compare motor trader insurance options before you pick a policy, and Howden can do that for you. We’re a motor trade insurance broker and our team are trained to compare a wide range of policy options across the industry and provide you a selection of quotes that not meet your insurance expectations, but also don’t exceed your budget.

How to apply for motor trade insurance

Applying for a motor trader insurance policy is the easy part!

Although sometimes the process of getting your hands on motor trade insurance can be difficult, confusing and time-consuming, it doesn’t need to be when you get in touch with an insurance broker.

Our team of industry experts here at Howden specialise in comparing and sourcing many motor trade insurance policies based on the information our clients provide us. We can also offer insurance insights, giving you a clearer and better understanding of how your policy could benefit you and your business. All in all, whatever your profession or role in the industry, we can help you find a motor trade policy that ticks all your boxes.

To speak to us, you can either give us a call on 0330 008 4960, click the Get a quote button at the top of this page, or visit us in your local Howden branch.

Where can I read more about motor trade insurance?

Want to learn more about motor trade insurance? Why not ready an motor or trade related article from the Howden Blog or a Motor Trade Insurance Guide?

• How much is motor trade insurance?
• Trade plates for the motor industry: Everything you need to know
• Are you seen as a trusted trader?
• Trade - are you coping with the cost-of-driving crisis?
• Is my car insured? How to check using askMID
• Who is my car insured with? How to find out
• Who pays the insurance on a company car?