Road risk insurance cover provides cover for vehicles owned by and in possession of the business for whilst on the road for work purposes. This works similarly to personal cover. It is the most basic motor trade insurance product available.
Almost all motor traders will need at least motor trade road risk insurance. This is ideal for small companies or individuals who are buying, selling or repairing vehicles, whether it be from business or home premises. If you drive vehicles not owned by yourself regularly for test-drives, services or moving for repairs then you will need at least this level of cover.
Within each road risk motor traders policy insurance there are elements similar to private car insurance in that you can have third party, third party fire and theft or comprehensive cover.
- Third party insurance covers damage to other vehicles involved in any accident but not to your own vehicle or the vehicles in your care
- Third party fire and theft again covers all third party vehicles but you are also covered in the instance of your car or the customers vehicles being fire damaged or stolen
- Comprehensive cover is the most thorough cover and will insure any damage to other vehicles and also your own vehicle and vehicles belonging to your customers are covered for any type of damage
To put this into context, if any vehicle belonging to a customer was damaged whilst in your care you would need comprehensive road risks insurance to insure you for this. These accidents can happen quite often such as scratches to the paintwork in a garage, accidents on the road during test drives or theft of a vehicle from your home or business premises.
However if you work in car repairs or servicing you may want to weigh up the costs of fixing any damage yourself against the cost of additional comprehensive cover. This is because third party alone usually means cheap motor trade insurance if you do not need the extras. However buyers and sellers may be safer with more thorough comprehensive cover.
You should bear in mind that when it comes to motor trade road risks insurance, you will only get the traders value for the vehicle. This is where personal cover differs because on your own vehicle you would obtain the retail value for your exact specification of car. However motor trade insurance only covers you for the trade value (the value you would have bought it at) so you will get less for the vehicle. For example if you crashed a vehicle that had a traders value of £3000 but you planned to sell it on for £5000 you will only receive £3000 from your insurers.