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Motor Traders Insurance

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What is Motor Trade Insurance?

Motor Trade Insurance also known as ‘Traders Insurance’ is policy specially designed to protect those who work within the car trade industry. It is also quite common to refer to this type of policy as just ‘Trade Car Insurance’.

Car mechanics, full and part time car sales, valeters, body shop repair garage and MOT stations are all types of trader who will require this type of policy.

We help you compare motor trade insurance so that you can get the best policy at the cheapest price from specialist UK brokers.

Types of Traders Insurance

Policies for the car trade industry are broken down into two main sections and as a trader, you will fall under one or the other. The type of motor traders insurance you require will differ greatly depending on your business.

Road Risk Insurance

A Road Risks policy is what most individuals will require. This form of motor trade policy will typically include cover for the vehicles you are working on or vehicles you hold in stock to sell against things such as damage or vandalism, fire and theft.

Those wanting a road risk only policy quite oftentrade from home or on the road and will not have a separate premises.

A road risk policy insured for Fire & Theft onlyis the most basic form of traders policy allowed to operate legally.

Combined Insurance

You will need a combined motor trade insurance policy if you work or trade from a premises separate to your home. This is to ensure you have premises cover as well as cover for the vehicles.

A car mechanic who works from a garage separate to his home would be am prime candidate for a combined traders policy.

This type of policy will provide protection not onlyfor the vehicles but a premises and the vehicles at the premises (either yoursor a customer’s).

If an incident were to arise at your separateproperty, whether it be an accident, damage to a vehicle or a theft, it islikely your combined policy will cover it.

Both road risk and combined policies can be tailoredby motor trade brokers to include other aspects like demonstration cover andemployer’s liability cover.

Levels of Cover

Traders insurance is extremely flexible and can betailored to each motor trade business needs. Much like private car insurance,it is broken down into 3 cover levels.

Third Party

A third party policy is the minimum level of coverrequired to trade. This cover level will cover the vehicles or those who aredamaged or involved in a accident of your causing. It does not cover anythingof yours though.

Third Party Fire & Theft

This form of cover will cover the above but also anyvehicles that are set fire to or stolen whilst under your control. This caninclude your own vehicles as well.


This cover is the most sensible level of cover to go foras this will cover you as well. It will include all of the above but also fullyprotect and cover yourself and own vehicles in the event of a fault claim.

Comprehensive insurance can be tailored to include coverfor tools as well as many other items you may choose to list.

Policy Addons

As part of the tailoring  process of your trade care insurance, you maywish  to add the following additions.

  • Legal Expenses – Legal expenses allow you to be able to fight a claim in court without it affecting your own wallet.
  • Breakdown Cover – Just as the name suggests, breakdown cover provides cover if your vehicle breaks down at all and provides rescue and recovery services
  • Public Liability Insurance – Public Liability Insurance makes sure that you are covered for costs regarding any legal action that may arise if a third party gets injured or damages occur to their property either at the business premises or if you are working at their home
  • Employer’s Liability Insurance – It is not just the public claims that you have to anticipate; sometimes claims may come from your own employees. Employer Liability Insurance covers this scenario by covering expenses arising in employee claims.

Working out the right level of cover for you

When buying a trader’s insurance policy, you need to make sure you know all the needs and requirements of your business regardless of how big or small or full or part time. Knowing this information will help you determine the kind of policy which is right for you.

Somepolices can include benefits such as allowing employees to use vehicles forpersonal use, this is likely to cost extra however and if you don’t haveemployees, then it is an unrequired extra.

Wesuggest you list everything that you intend to do within your business and thenhave that ready when you speak with an underwriter.

Getting Cheap Motor Trade Insurance

Being able to get cheap traders insurance will come down to several aspects. Primarily they will focus around your risk profile such as your no claims bonus or experience as a motor trader.

If you have limited bonus or experience though, there are some things you can so to help better your chances of cheaper motor traders insurance.

  • Pay annually – Though annual payments may appear less appealing than monthly ones, you can save quite a bit more on your policy than you otherwise would. A great tip here would be to always put a little bit of money aside throughout the year; that way, when your renewal comes you are able to pay the lump sum off and save yourself a pretty penny in the meantime.
  • Shop around – Now, this one seems obvious, but it’s surprising how many people are content on renewing with their current policy provider. Make sure you always shop around when looking for renewal prices, you could end up saving yourself hundreds of pounds whilst maintaining the same level of cover.
  • Security – Heightening your premises security will more than likely result in a drop in renewal price, as insurers will be more confident that your vehicles are secure and have a smaller possibility of being stolen or vandalised.
  • Compare Motor Trade Insurance – It is essential that you compare various traders policies not only for price but for cover offering. My comparing, you give yourself a much better chance at finding the right policy at the right price. It may take a little time on the phone to do but the rewards can be quite worth while.

Are you a genuine motor trader?

In the past, many people bought motor trade insurance so that they could drive any other vehicle. It was once a cheap way to drive any vehicle you wanted without having to purchase a single policy that also reflected the value of the car.

It is no longer possible to do this. Through the duration of your policy, you will be required to provide receipts and invoices for work you carry out or sales documents for cars you have bought and sold.

Although each insurance provider is different, you won’t be required to provide many often only needing to show 6 to 12 for a year.

Essentially, what the brokers and insurance providers are looking for is a financial investment into the motor trade industry.

Why use Total Insurance?

We work closely with competitive brokers in order to find you the best possible motor trade insurance cover.

Our team of agents are knowledgeable and can quickly work out what sort of motor trade insurance broker is right for you.

The insurance broker we place you with will be registered in England and authorised and regulated but the financial conduct authority so you can rest assured with peace of mind that you are in safe hands.

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