Motor Trade Insurance FAQ’s

What is motor trade insurance?

Motor trade insurance is a special type of cover that’s designed for those who work in the motor trade. Typically, those who work in the motor trade will have access to several vehicles and need to be able to drive them to and from their premises. Motor trade insurance provides protection against the associated risks.

Who can benefit from motor trade insurance?

Anyone who works in the motor trade can benefit from motor trade insurance. These include –

  • Garages
  • Car showrooms
  • Auction houses
  • Mobile mechanics insurance
  • Repair shops
  • Valeting services

What does motor trade insurance cover?

A typical motor trade insurance policy will provide cover for collection and delivery of customer vehicles, road testing customer vehicles as part of a service, any vehicles purchased for trade purposes and vehicles that are used as an accompanied demonstration.

Can I Drive My Own Vehicle On a Traders Policy?

Most motor trade policies insure you to drive any of your own vehicles and vehicles in your possession for motor trade puposes. Some insurers do restrict certain types of vehicles.

Can I get cover for my premises?

Yes. If you get a combined policy this will provide cover for your premises as well as your tools, stock and cash. 

Are luxury and sports vehicles covered?

This will depend on the insurance provider. Some providers consider sports and luxury vehicles too high risk to cover them but this isn’t always the case. It’s a good idea to contact any insurance providers to let them know the exact details of any high-end vehicles you have to find out if you can get cover for them. 

Can I drive vehicles without valid MOT/road tax?

Any vehicles you drive will need to have a valid MOT certificate. The only exception to this is if they’re being driven to an MOT that’s been booked in advance. 

As far as vehicle tax goes, you can drive vehicles without tax providing that you have valid trade plates. 

How do I get trade plates?

You can get trade plates by applying for them with the DVLA. 

Can lease/higher purchase vehicles be covered?

Yes it’s generally not an issue to get cover for vehicles that are bought on higher purchase or lease vehicles, providing the lease is for 6 months or longer. 

Are there any exceptions to vehicle types that can be insured?

This will vary from one insurance provider to the next. Typically any common vehicles, such as cars, bikes, vans etc. can be covered. Vehicles such as very high-end cars, bikes or imported vehicles might be more of an issue so it’s always important to let any insurance providers know about them. 

How can I pay for motor trade insurance?

Most insurance providers will give you the option to pay for your cover either by making an upfront payment that covers a year or longer of the policy; or by paying monthly via direct debit. Paying more upfront will enable you to make a saving with most insurance providers. 

What if I want to increase the level of cover I have mid-term?

This is usually not an issue and your insurance provider will be able to advise you accordingly. 

How long until I receive my insurance documents?

You’ll be sent an email that includes the details of your policy immediately after you make your first payment. Your physical documents will also be sent to you via post and you’ll receive them in 2-3 days with most insurance providers. 

What information do I need to provide to take out a policy?

To take out a motor trade policy you’ll need to provide correct and up-to-date information about your business such as the type of business you run, your employees and whether or not you have a premises. 

In addition to this you’ll also need to provide your driving licence and proof of trading. 

What if I want to cancel my policy before it ends?

You may be able to cancel your policy before it ends, although cancellation fees will apply with the majority of insurance providers. You’d also need to return your insurance documents. 

Do I need to declare convictions?

If your conviction is spent according to the Rehabilitation of Offenders Act then you are not required to declare your convictions. If they are unspent then you will be expected to disclose them. 

Is proof of trading always required?

Yes, most insurance providers will require you to provide proof of trading when taking out a policy. It will also be required when making a claim so it’s a good idea to have POT available at all times. 

What types of liability insurance are there and do I need them?

The two main types of liability insurance are public liability insurance and employers liability insurance.

If you have employees, even if it’s just 1 employee on a part-time basis then you’re legally obligated to get employers liability insurance. 

Although public liability insurance isn’t required by law, it is highly recommended that you get it. 

Can I use a private NCB with motor trade insurance?

Yes, most insurance providers will let you use your private or commercial NCB when taking out a motor trade insurance policy. 

Am I eligible for motor traders insurance?

In order to be eligible for motor traders insurance, you must –

  • Hold a full UK Driver’s Licence
  • Be at least 23 years of age
  • Be able to prove you work in the motor trade

I only work in the motor trade part time. Can I still get a policy?

Yes, the majority of providers offer part time motor trade insurance policies.

Can I add employees to the policy?

Yes. If you want to include employees on your policy then it’s possible to do this.

Does it cost more to add another driver?

Yes. More drivers means greater risk so your premium will be higher when there’s more than one named driver.

What is the Motor Insurers’ Database?

The Motor Insurers’ Database is a database of insured vehicles that can be accessed by the police and DVLA. It is used as a way to combat uninsured drivers.

Any vehicles that are in your position for more than 14 days must be listed with the MID to comply with the law. Your insurance provider will be able to do this on your behalf.

When do I need to notify my provider of any new vehicles I get?

For any vehicles that are in your possession for more than 14 days, you must notify your insurance provider immediately.