You may be looking to take out a motor trader insurance policy for a new company, if you are starting out in the motor trade industry. Or if you are dissatisfied with your current policy and have concerns that it may not be the best value for your business then you may wish to look for a new policy.
Anyone who runs a business that involves cars, vans or motorbikes will need motor trade insurance. Examples of such businesses include:
- Buying vehicles
- Selling vehicles
- Vehicle repairs
- Servicing or valeting vehicles
- Auto electricians
- Classic car restoration
- MOT centres
- Car washes
- Recovery operators
Regardless of the size or type of your business if you are handling multiple vehicles for business purposes you will need motor trade insurance. Whether you are a salesman, a valeter or a mechanic you will need some form of tradesman motor insurance.
Even if you are a part-time trader who works from home you still need this type of insurance if you are earning an income by handling multiple vehicles. Small businesses that buy and sell vehicles will need it, even if you only handle a few cars and sell them online. Mobile mechanics and driveway repairs will also need at least road risk cover.
If your personal policy covers you to drive other vehicles on a third party basis you may think this cover is sufficient. However this is not the case, if the vehicles are being used for business purposes you will need to register them on the Motor Insurance Database so personal cover will not cover you in the instance of an accident. Tradesman insurance is required even for a small business with no employees, (you may want to look into part time motor trade insurance.)
Within your business any employee who will be handling vehicles will need to be covered on a motor trade insurance policy as well. Each employee will need his or her name and driving history added to the policy. If you are a business with employees, you will also need to have employer’s liability insurance, which we will look at later.
To qualify for this type of policy you must be a self-employed motor trader. However motor trade insurance is not suitable for everyone. It is important to seek advice on whether or not you need trade insurance because if you take out a policy when you should not this would be considered as fraudulent. For example if you have a business that transports goods using vehicles you would require courier insurance, not trade insurance. Also if you have a trade insurance policy and put friends or family on this policy for cheaper premiums this is considered fraudulent if not for business use. There are methods in place to ensure this does not happen and fraud investigators will provide fines for such behaviour.
It is always best to speak to a motor trade insurance broker if you are unsure whether your business requires motor trade insurance and if so who within it needs to be on the policy, to ensure it is valid in the instance of an accident.