Does Your Business Need Motor Trade Insurance?

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There’s a lot to think about when starting a new business – have you registered your business correctly with the government? Are you abiding by all of the necessary regulations? Have you taken out all of the necessary insurances? You may already be aware of the most common business insurances such as Employee Liability Insurance, Public Liability Insurance and Professional Indemnity Insurance, as well as business contents and building insurance and of course Business Legal Protection, but there are many other industry-specific insurances that you may also want to consider, including Motor Trade Insurance. 

What is Motor Trade Insurance?

Motor Trade Insurance, sometimes also known as Road Risk Insurance, is a policy required by law if your business has anything to do with buying or selling cars, vans or motorbikes, conducting vehicle repairs, valeting or servicing etc. As a legal requirement, it doesn’t matter if your business is small and you only work on one or two vehicles a year, or if you are a global franchise, you need to have this insurance in place to stay on the right side of the law.  

What does Motor Trade Insurance protect you from?

At its most basic level, a Motor Trade Insurance policy ensures that you and your staff are covered to drive and work on any vehicle that comes into your business. In addition to enabling you to drive and move other people’s vehicles around when they are in your presence, a Motor Trade Insurance policy also protects your business in the event that any accidental damage is caused or something goes wrong during a repair. 

Who exactly needs Motor Trade Insurance?

Motor Trade Insurance is required by any business that cares for, takes custody of or controls a client’s vehicle. This includes the businesses already mentioned above but also less obvious businesses such as scrap yards, anyone operating vehicle restoration, repossession companies and valet car parking. It also doesn’t matter if you are a limited company or a sole trader, if you have responsibility for someone else’s vehicle then you will need some form of Motor Trade Insurance in place. The kinds of Motor Trade Insurances that you need will vary from business to business and depending on the level of cover that you want to have in place.


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What is covered within a Motor Trade Insurance policy?

As with any insurance policy, there are different tiers available depending on the level of cover that you need and it is important that you carefully consider the level of cover that you take out to ensure that you are sufficiently protected for the activities you undertake. Here are some of the most common things covered by inclusive motor trade policies, as you can see, many of the most common insurances required by businesses can be bundled together into one policy. 

  • Road Risk

Road risk covers your business and employees if you need to take a vehicle out onto a public road. This includes things like dropping off or collecting customer vehicles and testing cars before or after repairs. Like most motor insurance policies, there are different tiers of Road Risk cover from comprehensive to third-party fire and theft. 

  • Employers’ Liability Insurance 

Whether you employ one person or a hundred people, Employers’ Liability Insurance protects your business from any claims made against you by your staff, including for things such as injuries. 

  • Product Liability Insurance 

For those that trade in parts or repair vehicles, product liability insurance provides protection against defective components, meaning that if you fit a car part to a customers’ vehicle and it turns out to be faulty, you will be covered by your policy. 

  • Public Liability Insurance

If you deal with the public, which most businesses do, then this insurance covers you and your employees against any claims made by your customers or the general public. 

  • Material Damage Cover

 If you run a motor dealership and have unsold vehicles sitting on your lot, then this type of cover ensures that these vehicles are still insured and protected. Material Damage Cover doesn’t just cover vehicles, but equipment too. 


Ways to make your Motor Trade Insurance Cheaper

Aside from shopping around to compare Motor Trade Insurance prices, there are a few other things that you can do to keep the costs of your business insurance down including: 

  1. Taking out Combined Motor Trade Insurance
    As you can see above, there are a number of different policies that motor businesses may need, and taking them out individually can become expensive. Combined Motor Trade Insurance, allows a business to take out multiple policies at the same time, often dramatically reducing the overall policy price. 
  2. Take out policies for individual drivers
    “Any driver’ policies may be convenient if you have a lot of staff and a high staff turnover, but they can also be expensive. Instead, if only a few members of staff need to be insured to drive vehicles then consider taking out individual policies.  By taking out individual policies you will be able to find the best cover for all ages of your staff.
  3. Only take out insurance for the kinds of vehicles you need
    Like “any driver” policies, “any vehicle” policies that cover everything from cars to HGV’s can often be a lot more expensive. If you only work on motorbikes or only work on cars, then make sure that your policy only covers you for the vehicles that you need to drive.


Where to find the best Motor Trade Insurance

As with all insurance nowadays, the best way to find Motor Trade Insurance for your business is to head online and to start getting quotes. Don’t settle for the first company you stumble across and don’t disregard smaller insurance companies just because they have yet to make a name for themselves in the industry. Shop around, be specific about your needs and review your policy often to ensure that you are getting the best deal. 

So there you have it – hopefully, it’s a little clearer now as to whether your business needs some form of Motor Trade Insurance or not, we hope you found this guide helpful. 

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