Motor trade insurance can be used by a variety of businesses which handle vehicles. From car dealers, vehicles sales, repair services, motor mechanics, car valets, and more. Since it can cover a wide range of businesses, then it is only vital that each policy is customized based on the need of each individual or business. Just like any other type of insurance, it’s worthwhile to do some research before choosing a policy so you can get the best deal.
What is Trade Insurance?
Motor trade insurance, also known as traders’ insurance, is a type of insurance that is a must for those who are running a business that involves vehicles. The policy can cover many kinds of vehicles from cars to trucks. It can cover businesses which are handling vehicles from other people or even their own.
A motor trade business will be responsible for taking care of customers’ vehicles which are left in their custody. Hence, the business owner must obtain an insurance policy that can cover the damages in case of accidents. In the motor trade insurance industry, the phrase ‘care, custody, and control’ is quite common. Basically, it pertains to the vehicles which are already in the possession of the business. This means that the vehicle will not be covered with the owner’s vehicle insurance anymore.
With a motor trade insurance, your business and your employees are covered when working or driving on your client’s vehicles. It can also cover the vehicles that are owned by the company.
The best thing about this policy is it is very flexible. For instance, if you are operating a garage, then this policy can cover your employee who is driving the customer’s vehicle. On the other hand, if you are running a repair shop, then this policy can cover any accidental mishaps committed by the mechanic who is repairing the vehicle. It can also be useful for businesses which are offering tire-replacement service.
Who needs Trade Insurance?
Motor trade insurance is mandatory if you are a motor trader. However, this legal requirement is not only imposed on limited companies. In fact, it is also mandatory if you are self-employed and is responsible for other people’s vehicles.
There are different types of motor trade insurance policies that you can choose from. You must obtain the one the fits to the type of business that you are operating. For instance, if you are running a business which is responsible for the care, custody, and control of other people’s vehicles then you need a policy that provides protection for your customers’ vehicles. However, if you are involved in car sales or delivering vehicles, then you might require other types of coverage.
On the other hand, if you are a motor trader who is doing business transactions in more than one area, then you might require a policy that can cover all your activities.
Who can get Trade Insurance?
Not all individuals or businesses can obtain a motor trade insurance policy. If you want to get a motor trade insurance, then you must prove that you are operating a legitimate business which deals with vehicles and is generating an income. Keep in mind that motor trade insurance must not be used by individuals who want to get coverage for driving multiple vehicles.
What type of coverage can you get from Trade Insurance?
The motor trade insurance policy offers different types of coverage, be sure to choose the one that fits your specific needs. Since there is a wide range of businesses that deal with the motor trade, then the coverage also varies immensely. Generally, it can include some of the following:
This type of coverage permits you to drive your own vehicle or other people’s vehicles provided that your purpose is to accomplish a motor trade activity, regardless of what it is. On the other hand, if you are operating a business that does not require you to drive vehicles then you don’t need the road risk policy. However, you might consider having the parts only cover.
Parts Only Cover
The most basic coverage of motor trade insurance is the third party policy. But you may also get a “parts only” policy depending on the business that you are operating. Take note that this policy cannot cover you when you are driving other people’s vehicles on the public road.
Combined Motor Trade Insurance
This type of insurance offers a variety of coverage including road risks, your building, and your equipment. By choosing a combined motor trade insurance, you can save a lot since this is much cheaper compared to getting separate policies.
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