What is Motor Trade Insurance?
Motor trade insurance covers mechanics, car dealerships, service and repair garages, body shops, MOT stations and classic car restoration.
Traders' insurance is designed for businesses where staff drive or work with cars that are left in their care, custody and control. Once the keys to a vehicle are handed over, it is no longer covered by the owners’ private insurance. There are multiple types of policies designed to cover the different types of motor trade activity.
Who needs motor trade insurance?
If you work in the motor trade industry, for example buying, selling, repairing, collecting, recovering or delivering cars, you need appropriate insurance. This includes the following businesses:
- Service and repair garages
- MOT stations and garages
- Body shops
- Mobile Mechanics
- Breakdown & Recovery Operators
- Vehicle Collection & Delivery
You will need to prove that you operate a genuine motor trade business and are asked for evidence of your trading history. Don’t worry, this is standard practice and helps to keep premiums as cheap as possible for genuine traders.
If you are working as a part-time trader, you will still need a traders’ insurance policy.
As soon as you start buying and selling vehicles for profit, you need a professional insurance policy to cover your activity.
If you’re unsure which insurance cover your business needs, read our guide on part-time motor trade sales, or get in touch with our team.
What does motor trade insurance cover?
Traders’ insurance typically covers:
- The named driver on the policy against losses relating to work in the motor trade
- Road risks cover for incidents on highways and any third-party damage to public property
Remember, if you drive your own vehicle or other people’s vehicles as part of your business activity, the law requires you to have traders’ insurance.
The minimum level of cover available is road risks insurance. This policy protects you against risks while driving vehicles on the road. These can be vehicles in your possession, with a view to buying or selling them, or customer vehicles entrusted to you. There are three categories of road risk tiers: third-party, third-party fire and theft or comprehensive basis.
Combined insurance includes road risks insurance with a range of additional covers. These can protect your business premises (e.g. a garage or showroom), as well as cover for vehicles stored on those premises, tools and equipment stored on-site, and more.
Additional options include:
- Buildings cover (whether you own or rent premises)
- Employers’ liability
- Public liability
- Product liability
- Material and equipment damage
- Money cover
- Tools cover
- Additional drivers
- Demonstration cover
Liability insurance protects your business against claims and legal fees.
If you’re still not sure which type of insurance you need, read our guide on road risk vs traders’ combined.
How much does a trade insurance policy cost?
Like any car policy, the cost of motor trade insurance depends on several factors, including:
- The level of cover
- No-claims history
- Voluntary excess
- Risks you need to protect against
Using ChoiceQuote means comparing insurance quotes from a panel of the most experienced insurers. Whether you want a full traders’ combined policy or the cheapest possible road risks premium, we can find you the best value policies. Our policies start from £8.73 a week, subject to terms and conditions.
Get your traders’ insurance quote
At ChoiceQuote, we’ve been helping motor traders get the best value insurance for over 25 years. We discuss your requirements and business needs and search the insurance market, getting quotes from multiple insurance providers. We do the legwork for you and will recommend the best insurance policy.
You can start the quote process here on the ChoiceQuote website or calling us on 01625 854832.
How to get cheap trade insurance
We understand it can be tempting to choose the cheapest quote available, but you also need to be confident that it will cover your risks if you do need to claim.
There are several ways you can reduce the cost of your insurance, including:
- Speak to an independent broker specialising in motor trade insurance. Not all brokers are the same so choose wisely and do your research. Speak to others in the trade.
- Build up your no-claims bonus over time and maintain it by keeping claims to an absolute minimum.
- Consider a higher voluntary excess – but you’ll have to pay the additional excess if you need to make a claim.
- Paying your premium upfront means you don’t pay interest to finance companies, but it can help with your cash flow by paying monthly.
Existing Customer Queries
How to make a claim
- Always report an accident to us within 24 hours of it happening, regardless of who is responsible or to blame
- Call us on 0800 195 4905 any time, any day of the year. Our 24/7 claims lines are:
If possible, please let us know:
- Your policy details
- Details of other parties involved (their registration number, name and contact details)
- Crime reference number, if applicable
- Witness details, if applicable
For more information, visit our How to Make a Claim page.
How to make a change to your policy
You can contact our teams to adjust your policy. For example, this could be:
- A change of business premises
- Change of vehicle(s)
- Additional drivers
To make changes to your policy, contact: 01625 854310
For more information, visit our Changing Your Policy page.
Updating the Motor Trade Insurance Database (MID)
Motor traders buy and sell vehicles on a regular basis, so your insurance policy allows you to update the MID with details of vehicles yourself.
You can update the MID via an online portal, where you simply login and add or remove vehicles where necessary. Alternatively, ChoiceQuote can make changes on your behalf, for an additional fee. Contact us on 01625 885046.
For more information, visit our Motor Insurance Database page
No Claim Discount
Motor traders can transfer no claims discount from another motor trade policy, or from a private motor policy. Private motor no-claims can also be mirrored on some motor trade policies.
If you have proof of no claims from your existing insurer, please contact the relevant team to discuss the best, most secure way of sending this to us: 01625 854310
Frequently Asked Questions
How much does motor trade insurance cost?Motor trade policies start from £8.73 a week (plus insurance tax premium - IPT), subject to terms and conditions.
Who needs motor trade insurance?Anyone working in the motor trade industry needs motor trade insurance. This includes anyone buying, selling, repairing, collecting, recovering, valeting or delivering cars. Even if you only work part-time in the motor trade, you will still legally need insurance.
Road risk vs combined motor trade insurance – what’s the difference?Road risks insurance is the minimum legal requirement for motor traders and is suited to smaller traders, mostly operating from home. This could protect you against losses arising from incidents on the public roads, such as collisions with other vehicles. Motor trade combined insurance protects you against road risks and includes cover for your business premises (rented or owned), damage to bodywork or theft of a vehicle, and theft of tools or money from your property.
Can I cover my home address with motor trade insurance?Road risks insurance cover is available for individuals who work from a home address. If your business is based at a residential property, call ChoiceQuote. We can help you to understand if this is likely to affect your policy and the premium you pay.
Can I transfer my no-claims discount?If you have a proven claim-free record on a previous motor trade insurance policy, you may qualify for a no-claims discount of up to 60%. You can either transfer your existing no-claims bonus or opt for a mirrored discount - even if your previous driving history was on an employer's motor trade policy and not in your name. And if you haven’t worked in the trade before, you can opt to transfer or mirror the no-claims discount from your private car/vehicle policy. Speak to us for details on how we can save you money.
What if I work part-time in the motor trade?Part-time motor traders still need appropriate insurance cover. We can help you to find the right motor trade policy, whether you're full-time, part-time, still in training, work from home or on a mobile basis.
Can I add a named driver to my traders’ insurance policy?Yes, you can. However, the more named drivers you list on a motor trade insurance policy, the higher your premium will be. Try to restrict driving privileges to as few individuals as possible if you want to get the best value motor trade insurance.
Can I use motor trade insurance as a personal policy?Motor trade insurance cover is designed for people who work in the trade and need to drive customers' cars, e.g. for road testing or recovery purposes. It should not be used as a personal 'any car' insurance policy. If you need insurance to drive any car but you are not in the motor trade, we may still be able to find you the best cover.
What is covered with a dealership policy?Dealership insurance policies cover vehicle stock you have on-premises against damage or theft. Your buildings, employees and members of the public visiting your site are also covered. This is combined with road risks insurance for vehicles in transit, used during test drives, and collection and deliveries. Combined motor trade insurance can give you all of this in a single policy, offering you the best value motor trade cover for your needs.