2022 Guide to Motor Trade Insurance: Answers to Frequently Asked Questions

Acquiring motor trade insurance is a must if you’re in the motor trade industry. All the options can seem overwhelming though if you don’t know what you need and you don’t know what to look for.  To help you simplify the choosing process, we’d answer all the frequently asked questions that people have when it comes to motor trade insurance. You can be sure that you’d be able to choose the best motor trade insurance policy for your needs after reading this post. This post will discuss the following:

  • People who need motor trade insurance
  • Different levels of motor trade insurance
  • Tips on saving money when purchasing a motor trade insurance
  • The difference between part-time traders and full-time traders
  • Tips on how to make the most out of a No Claims Bonus
  • The deal on young motor traders (25 and under)

Who are the people who need motor trade insurance?

Everyone who works in the motor trade industry needs motor trade insurance. Such list includes individuals who work in the following fields:

  • MOT stations
  • Car dealing
  • Vehicle Collection
  • Delivery Agents
  • Tyre Fitters
  • Service Garages
  • Repair Garages
  • Mobile Mechanics
  • Breakdown Operators
  • Recovery Operators
  • Body Shops
  • Valets
  • Any commercial enterprise that involves the selling, buying, repairing, servicing, cleaning, or moving of vehicles.

You can only be granted motor trade insurance if you work in the trade. Hence, you will be required to show proof that you work in such an industry before receiving a quote. If you’re new in the industry and you need guidance as to required documents and permits, you should work with motor trade insurance brokers.

What are the different levels of insurance cover that motor traders can choose from?

In order to understand the different levels of insurance available for motor traders, you simply need to know the three kinds of motor trade insurance:

  • Road Risk Insurance– this kind of insurance is needed by every motor trader who drives vehicles. This insurance covers any vehicle that a person may drive in connection with motor trading including vehicles that are owned by customers
  • Traders Combined Insurance – this kind of insurance goes beyond the security that Road Risk Insurance offers. It also provides security for accidents that occur around business premises including stock vehicles, tools for repair, and demonstration risks.
  • Liability (Public and Employers) – this insurance covers risks for motor traders with physical shops or stores. With one, you won’t have to worry about liability if any member of the public – customer or non-customer – will encounter an accident in your business vicinity.

Tips on Saving Money When Purchasing a Motor Trade Insurance

Expert insurance agents provide the following tips that can allow you to save on motor trade insurance:

For those who will avail of Road Risks Insurance, the following should be considered:

  • Transfer the No Claims Bonus provision of your private or commercial car to your motor trade policy
  • Increase the voluntary excess to allow you to cover minor repairs
  • Have an excess protection cover that will allow you to pay out the excess on your policy should you make a claim.
  • Consider a comprehensive cover that can ultimately turn out as a cheaper option
  • Only name professional drivers with good driving history
  • Minimize driving during rush hours

For those who will avail of Trade Combined Insurance, the following should be considered:

  • Never underinsured your stock vehicles
  • Boost the security on your premises by installing security alarms, fencing, and lockable gates
  • Improve the safety protocols deployed at work
  • Take care of your health and that of your employers
  • Do not pay for covers that you won’t need

Part-time Motor Trade Insurance vs Full-time Motor Trade Insurance

A part-time motor trader sells vehicles as a side-line to a main job. A mechanic or recovery driver who does occasional work is also a part-time motor trader.

A full-time motor trader is one that works in a dedicated business area. He or she is one that has a showroom, a garage, or a storage facility.

Part-time motor traders can already be fully protected by a Road Risks Insurance while full-time motor traders will be best protected by a Trade Combined Insurance.

Tips on Making the Most Out of a No Claims Discount

A No Claims Discount will allow you to pay a lesser premium if you did not claim under your policy for a year or more. You can make the most out of it if you will consider the following tips:

  • Refrain from claiming for minor repairs
  • Keep the records of your proof of no claims to make verification and certification easier
  • Opt for an insurer that offers a high level of No Claims Discount

Why do young people have a hard time when getting motor trade insurance?

People under the age of 25 have a hard time securing motor trade insurance because their age and lifestyle offer more risk. Young drivers with minimum experience are more at risk of encountering accidents and that is something that insurers are not excited to participate in — it’s not good business for them. But you can still get one if you’re a young professional in the motor trade business and you work in repairs and servicing.