Motor trade insurance working from home

Can you be a motor trader from home?

Yes, you can certainly run your motor trading business from your home. However, this type of arrangement is slightly different to running a business from a commercial property, and you’ll have to be aware of the following:

• Legal requirements: You'll need to comply with local zoning laws and regulations. Some areas may have restrictions on running certain types of businesses from residential properties.

• Licensing: Regardless of where you live, you'll likely need to obtain the necessary licences and permits to operate as a motor trader. It’s also important that you’re considerate towards the ways in which your work — such as increased traffic or noise from your vehicle repairs — might disturb your neighbours.

• Storage: Be sure to think about where you'll store the vehicles you're working with, whether they’re your own or belong to your customers. Most residential properties have limited space, which could restrict how you manage and scale your business.

• Insurance: You'll need specialised motor trade insurance that covers home-based operations. Standard home insurance policies don't cover business activities.

Let’s take a look at the insurance you’ll need in a bit more detail.

Does working from home affect my insurance?

If you run your motor trade business from your home rather than a commercial premises, you need to have specific home-based motor trade insurance in place. This type of insurance is tailored to the unique circumstances of operating your business from a residential setting. It usually balances your personal and business coverage needs in ways that standard policies may not.

Here are some of the ways in which motor trade insurance working from home is different to standard motor trade insurance:

• Risk assessment: Insurers typically view motor trade lower risk if it’s done from a home rather than a commercial space. This can help to lower your premiums and improve your policy’s terms. 

• Vehicle storage: Policies for home-based traders usually have specific conditions for storing vehicles at a residential address, which may differ from commercial storage requirements.

• Scale of operation: Home-based policies often cater to smaller-scale operations. Your policy may even limit the number of vehicles it will cover at any given time. 

• Business equipment: Your at-home policy might include coverage for business equipment that’s different to what’s typically covered in traditional policies.

• Personal vehicle use: Home-based policies usually also cater for personal vehicles that are used for business purposes.

• Flexibility: At-home policies may offer more flexibility depending on whether you run a part-time or full-time operation.

• Online operations: Your policy might have specific provisions for online sales and remote customer interactions, which are more common in home-based businesses.

Because insurers consider home-based motor trade insurance to be lower risk and usually smaller scale, you might find that you pay less for your premiums. 

What type of motor trade insurance do I need for a home-based business?

The type of insurance you need will depend on the type of services you’re offering to your customers. Are you servicing or repairing vehicles? Selling cars part time or full time? Are you a hobbyist who restores classic cars or modifies vehicles? When you take out your home-based motor trade insurance, your insurer or broker will conduct a thorough assessment of the type and scope of your work before drawing up a contract.

They’ll likely also consider the types of vehicles you typically deal with and whether you store these vehicles at home or somewhere off site. Your tailor-made policy will likely include some or all of the following types of insurance:

• Road risk insurance: This is essential and allows you to drive vehicles for business purposes. As with standard car insurance, you’ll be able to choose from third-party; third-party, fire and theft; and comprehensive insurance.

• Combined motor trade insurance: This more comprehensive option includes road risk coverage plus protection for your home business premises, your tools and equipment, and any stock you may store on your property, including vehicles and parts.

• Public liability insurance: Public liability insurance covers you if a customer is injured or their property is damaged while they’re visiting your home to make use of your services.

• Employers’ liability insurance: This is mandatory if you have any employees, even if they only work for you on a part-time or temporary basis. If your employees make a claim against you for loss or injury at work, employers’ liability insurance will protect you.

• Service indemnity insurance: This type of insurance protects you against claims for faulty parts or if you or a member of your team accidentally fits parts incorrectly. 

• Business interruption coverage: Business interruption coverage helps cover lost income if you can't operate due to an insured event, such as a fire or flood.

• Personal vehicle coverage: This covers your own personal vehicle when you use it for business purposes. 

There are also extra add-ons that you might choose, such as coverage for money and keys, product liability insurance, refurbishment and restoration cover, and demonstration cover. Be sure to chat to your insurer about your specific home-based setup so that they can draw up a policy that suits your needs exactly. 

Looking for some help? We’re here to ensure that your motor trade business at home has all the coverage it needs. Call us today to arrange a quote.

Related articles:

• How much is motor trade insurance?
• Trade plates for the motor industry: Everything you need to know
• Are you seen as a trusted trader?

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