The motor trade industry is diverse and complex, encompassing everything from car dealerships and repair shops to valeting services and vehicle recovery businesses. Whether you’re buying and selling vehicles, offering repairs, or running a garage, motor trade insurance is a crucial component of protecting your business.
In this guide, Insurance Revolution will break down everything you need to know about motor trade insurance, including what it covers, who needs it, and how to choose the right policy.
What is Motor Trade Insurance?
Motor trade insurance is a specialised form of coverage designed specifically for businesses that operate within the motor trade industry. This type of insurance is essential for any business that handles, repairs, or sells vehicles, as it offers protection against a wide range of risks unique to the industry.
Key Features of Motor Trade Insurance Policies
Road Risk Insurance: Covers vehicles owned by the business or customer vehicles being driven on the road. Essential for businesses where employees need to drive customer cars, such as garages or dealerships.
Combined Motor Trade Insurance: Offers broader coverage, including protection for business premises, tools, equipment, and stock in addition to road risks.
Public Liability Insurance: Protects against claims from third parties for injury or damage that occurs on your business premises.
Employer’s Liability Insurance: Legally required if you have employees, covering you against claims for work-related injuries or illnesses.
Who Needs Motor Trade Insurance?
Motor trade insurance is designed for businesses that engage in activities related to the buying, selling, repairing, or handling of vehicles. Here are some examples of businesses that typically need motor trade insurance:
Car Dealerships
Whether you’re selling new or used cars, car dealer insurance covers vehicles on your lot, during test drives, and in transit. Why not request a car dealer insurance quote today?
Vehicle Repair Shops and Garages
From body shops to general mechanics, if you’re repairing or servicing customer vehicles, you need coverage that protects against damage, theft, or accidents involving those vehicles.
Valeting and Detailing Services
Businesses that clean, detail, or valet vehicles should have motor trade insurance to cover any potential damage to customer vehicles while they are in your care.
Vehicle Recovery Services
If your business offers a car recovery service, breakdown and recovery agent insurance can cover the risks associated with transporting vehicles, including road risks and potential damage during recovery.
Mobile Mechanics
If you offer repair services on the go, mobile mechanic insurance can cover your tools, equipment, and the vehicles you work on, whether at your premises or on the road.
MOT Test Centres
If you run an MOT testing station, MOT garage insurance or MOT station insurance is essential to cover the risks associated with inspecting, handling, and potentially test-driving customer vehicles.
Types of Motor Trade Insurance
Motor trade insurance policies can be tailored to meet the specific needs of your business. Here’s a breakdown of the key types of coverage:
Road Risk Insurance
This is the most basic level of motor trade insurance and is essential for any business that drives vehicles on the road, whether for testing, delivery, or customer service.
Road risk insurance comes in three levels:
Third-Party Only: Covers damage to other vehicles and property, as well as injury to others, but does not cover damage to the vehicles you’re driving.
Third-Party, Fire, and Theft: In addition to third-party coverage, this policy includes protection against fire damage and theft of the vehicles in your care.
Comprehensive: The highest level of coverage, including third-party, fire, and theft, as well as damage to the vehicles you’re driving, regardless of who is at fault.
Combined Motor Trade Insurance
Combined policies offer more comprehensive coverage, ideal for businesses with premises and a wider range of risks to manage.
These policies can include:
Premises Insurance: Covers your business premises against risks like fire, theft, and damage.
Stock Insurance: Protects the vehicles you have for sale, as well as parts and tools.
Tools and Equipment Insurance: Covers the cost of replacing or repairing tools and equipment used in your business.
Public and Employer’s Liability Insurance: Provides coverage for legal liabilities, including injury or damage claims from third parties and employees.
Liability Insurance
Public Liability Insurance: Protects your business against claims from customers or the public for injuries or damage that occur on your premises or as a result of your business operations.
Employer’s Liability Insurance: Required by law if you have employees, this coverage protects against claims from staff who suffer work-related injuries or illnesses.
Optional Additional Products
Depending on your business’s specific needs, you may want to consider additional coverages such as:
Business Interruption Insurance
Covers loss of income if your business operations are disrupted by a covered event, such as a fire or flood.
Legal Expenses Insurance
Helps cover legal costs in the event of disputes or lawsuits.
Engineering Insurance
Covers machinery and equipment used in your business, such as vehicle lifts or diagnostic tools.
How to Choose the Right Motor Trade Insurance Policy
Assess Your Business Needs
Start by evaluating your business activities and the associated risks. Consider the size of your business, the number of vehicles you handle, the type of work you do, and whether you have premises that need coverage.
Compare Coverage Options
Not all motor trade insurance policies are created equal. It’s important to compare the coverage options available, ensuring that the policy you choose offers adequate protection for your specific risks. Look for a policy that balances comprehensive coverage with affordable premiums.
Check for Flexibility
As your business grows or changes, your insurance needs may evolve. Choose a policy that offers flexibility, allowing you to add or adjust coverage as needed without excessive penalties or costs.
Consider the Insurer’s Reputation
The reputation of your insurer matters, especially when it comes to handling claims. Research customer reviews and ratings, and consider the insurer’s history of customer service and claims processing. A reliable insurer will make the claims process smoother and less stressful.
Consult with an Insurance Broker
If you’re unsure about the type of coverage you need or how to navigate the options available, consulting with one of our motor trade insurance brokers can be a smart move. Motor trade insurance brokers can offer expert advice, help you compare policies, and find the best coverage for your business at competitive rates.
Why Choose Insurance Revolution for Your Motor Trade Insurance?
At Insurance Revolution, we specialise in finding specialist motor trade insurance policies for those in the motor trade industry. We understand the unique challenges you face and are committed to helping you protect your business with comprehensive, affordable insurance coverage.
Whether you’re running a small garage or a large dealership, having the right coverage in place can provide peace of mind and financial security. To learn more, visit our dedicated motor trade insurance page and contact one of our dedicated motor trade insurance brokers.