What does motor trade insurance cover and how much does it cost?

what does motor trade insurance cover and how much does it cost- glowsure insurance brokers

When it comes to motor trade insurance cover, there is no one-size fits all, as a number of factors can drastically effect the cost of the policy.

Depending on your business circumstances, you can expect to pay between £500-£2,000 plus per annum for motor trade insurance cover. The cost of the policy is subject to factors including level of cover required, previous claims, trading experience, number of employees and vehicle usage to name but a few!

When you choose to work with Glowsure Commercial Insurance Brokers, we will talk you through the different levels of cover to find a motor trade insurance policy that is best suited to you.

Read on to find out more…

What is motor trade insurance?

As a business operating in the motor trade industry, a private car insurance policy will not be sufficient to insure you for your business activities.

This is because private car insurance is only designed to provide insurance cover for your vehicle being driven for social domestic and pleasure use, in addition to commuting to and from a permanent place of work.

Most motor trade insurance policies will insure your business to drive their own vehicles in a business and social, domestic and pleasure capacity as well as customer vehicles.

A motor traders policy will also insure your customers to test drive your stock vehicles.

How does it work?

A motor trade insurance policy is designed to cover your motor trade business for all insurable perils that your business could potentially be exposed to.

Working with our motor trade insurance specialists at Glowsure, we will conduct a review of your business and undertake a scan of reputable UK insurers in order to provide you with a motor trade insurance product that meets your demands and needs.

What does motor trader insurance cover?

The scope of what motor trade insurance will cover you for varies depending on your business.

Below is a guide to what most motor trade policies offer:

Material damage

Provides cover for buildings, machinery, plant, equipment and business stock, portable hand tools and employees tools.

It also provides cover for your own and employees tools at the premises, and cover can be extended to include hand tools away from the business premises.

Employers Liability

Protection for employees in the event of injury or illness while in the course of employment. Employers liability also provides cover for trainees and personnel undergoing work experience.

Products and Public Liability Insurance and Service Indemnity

Public liability insurance provides protection against your legal liability for injury to third parties and damage to their property including legal costs and expenses.

Business interruption

Business interruption covers your motor trade business for loss of income due to an insured peril occurring.

An example of this would be a fire at the premises that results in a total loss where the policyholder would therefore be unable to trade.

The business interruption section of the motor trade insurance policy, would provide cover for loss of income while the premises is being restored.

The business interruption section can also be extended to cover the following:

  • Suppliers extension – loss of income due to an insured event at a suppliers premises. An example of this would be a fire at a suppliers premises that results in your business not being able to obtain the parts/materials to carry out your business activities.
  • Customers extension – loss of income due to an insured event at a customers premises. Similar to suppliers extension noted above.

Commercial Legal Protection

Legal protection to cover you for legal costs and expenses for criminal prosecutions, data protection breaches, jury service/court attendance, contract disputes and tenancy disputes and tax disputes, wrongful arrest and property protection.

Motor Legal Protection

Provides cover for motor legal costs and expenses for uninsured loss recovery and personal injury following a non-fault accident and motor prosecution defence.

Goods in transit

Under the motor trade policy, your property is often insured whilst in transit anywhere in Great Britain, Northern Ireland, the Channel Islands or the Isle of Man.

It usually also provides cover for employees personal belongings, losses to sheets, ropes, tarpaulins and packing materials and damage to customers goods.

Own vehicles

This part of the policy covers any vehicle which is the insured’s property or for retail sale that is damaged or destroyed due to an insured peril occurring.

In the unfortunate event that a vehicle is destroyed, the insurer would settle on a trade value basis.

Customers vehicles

This covers any customer vehicle held in your custody or control that is damaged or destroyed, due to an insured peril occurring while driving the customer’s vehicle, in the course of your business.

Road Risks

Your traders insurance provides road risks cover for directors, partners and policyholders and employees who have the policyholders permission to drive their own vehicles and customer vehicles for business use – as long as the vehicles are registered in the business or policyholders name.

Any vehicles covered, can also be extended to provide social, domestic and pleasure use and as with personal car insurance, road risk insurance providers are able to offer third party cover, third party fire and theft cover and comprehensive cover.

Third party fire and theft provides the same cover as third party only cover, but also covers your vehicles if they are stolen or damaged by fire.

A comprehensive road risks policy provides the same cover as third party fire and theft, but also covers your vehicles for accidental damage to your customer’s vehicles as well as your own.

A benefit to the motor trader under the road risk section of a motor trader insurance policy, is that the policyholder will not have to arrange a private car policy.

This is due to the policyholders personal vehicles being insured under this section of the policy – subject to the vehicles being registered in the policyholders business name or personal name.

Demonstration cover

Demonstration cover relates to customers test driving stock vehicles. Motor trade insurance providers can provide this on either an attended or unattended basis.

Unattended demonstration has become a very important cover for motor trade customers, due to the requirement to social distance due to the Coronavirus pandemic.

Any driver cover

A motor trade insurance policy will also provide cover for any driver that has the policyholders permission to drive on the policy for business use and can be extended to social, domestic and pleasure use.

At Glowsure we can talk you through the different insurance policies and recommend those most relevant to your motor trade business.

Why do you need motor trade insurance?

As a motor trader you are legally required to have vehicle insurance in force to comply with the Road Traffic Act if you are driving your own vehicles or customers vehicles for Motor trade purposes.

You also have a legal requirement to have in place Employers Liability insurance under the Employers Liability Compulsory Insurance Act 1969, if you are employing anyone in a clerical or manual capacity.

How much does motor trade insurance cost?

A Motor Trade Road Risks insurance will usually start at a premium of £500 and Motor Traders Combined will usually start at approximately £2,000 per annum.

Motor trade insurance premiums will increase based on the business activities being conducted, claims experience, trading experience, number of employees and driving experience and what vehicle use is required – for example business use only or including social, domestic and pleasure.

In Summary

At Glowsure, we are experts at helping motor traders get the best motor trade insurance cover there is. So let us save you time, money and stress by doing the legwork for you, as we compare quotes from market leading insurers.

Why not contact us today for a free no obligation motor trade insurance quote!

Jon Youlden
Jon Youlden
Jon is an experienced member of the Glowsure team who specialises in areas of motor trade insurance and cyber insurance among others.
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