Motor Trade Insurance Explained By Eric Token At Isnare.com Ezine Articles

This insurance covers one of those slightly grey areas (certainly in the motor trade insurance policy area) where you really need to be clear about what you are buying and why. This isn’t a grey area because there’s possibly one man in every ten streets of the UK changing the vehicle he drives every week or two, and he also knows a man who can fix it for you if anything goes wrong.

No, this is a grey area because, to a large extent, this is a commercial form of insurance, even if you’re only a mechanic and needing the policy cover to deliver the car back to the customer (even if that might be the distance from the ramps at the back to the dealer forecourt at the front). All Motor Trade Insurance has a sales element attached to it, so they will say their aim is to “provide convenience, superior service and competitive prices” but many of these companies will require a survey of the site in order for you to be able to take out insurance, and you will need to make sure that your security and alarm equipment is up to scratch - who’s going to insure you if you’re easy to steal from?

Then there’s the type of business you have; you may find that the ‘bend and mend’ sector is growing, and as a result the value of your customer’s cars has become greater than your fixed assets (like machinery). You need to increase your cover to comprehensive, rather than just third party.

Your business is growing and you are employing more staff, all of whom, if in contact with vehicles as sales staff or mechanics, will need to be named on the policy and naturally you may have staff leaving to go elsewhere - all changes which have to be made to the driver-only policy. Naturally, you can purchase all these differing types of insurances as separate policies, or include as many as possible in one, but as a business where you will encourage and expect customers to enter your premises (even if it’s just a forecourt) you will need public liability coverage incorporated into your Motor Trade Insurance Policy.

On the other hand if you are just looking to get yourself a third party only, driver-only type of policy, you should expect certain conditions to be stipulated on your personal, private behaviour also, as the value of your insurance rests solely on you as a risk. One thing to remember though, many of the ‘specialist’ companies say that they do not need to carry out a survey of the premises.

That doesn’t mean that you won’t have to provide photos and receipts, it means that they may not send their man around to check. Something else to consider is that everybody sells insurance, from the supermarkets to the bank, and if you have sought finance to establish or expand your business then incorporating your insurance with the lender may actually prove more profitable for you.

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