Understanding Motor Trade Liability Insurance

It is important to be insured, especially if you are trading in the UK. Trade insurance covers the insured from third party liabilities unforeseen mishaps and also covers risks and employee liability if you are in a huge business.

Similarly, in the motor trading business traders are expected to take an insurance policy that safeguards their interests as the cost of incurring public liability or internal risks  can be enormous and could wipe out the motor traders business. According to www.motortradeinsurance.net.” A motor trade insurance policy saves the policy holder from any damage caused to the business may it be at the time of accident or any kind of mishap at the place of work. Any damages caused are paid by the motor trade insurance company”.

We are all aware of the strict stipulations under the Road Traffic Act which ensures that drivers must meet liabilities they incur should they injure other people or cause damage in an accident. Certain insurance policies have to be taken if a motor trader wants to carry on business in UK. Pending which heavy fines and even imprisonment are possibilities.

According to Paul Headley “Motor trade insurance is a vital component for any motor related business to trade legally. Trade insurance is a specialized policy specifically for businesses in the motor trade industry. This can range from mechanics to car dealers and tradesmen to name but a few”.

Please do not consider using a private vehicle insurance to carry out any kind of motor trading business as that would be illegal in UK and you could be penalized. If you are dealing in any kind of business related to cars that is if you are selling, repairing importing or are in anyway related to even ancillary businesses of cars then  you are a motor trader.  A motor trade insurance policy is a legal requirement in UK.

Motor Trade Insurance covers

Road risks: This is the basic insurance policy required legally by the Law, it covers the policy holder against damage of his commercial car, while driving on the road or when parked at policy holder’s address or business partners location.

Liability insurance: Broadly covers employer’s liability and public liability which we will discuss at length.

Comprehensive Insurance: It is an insurance policy that covers both road risks and liability insurance it also covers stock material machinery equipments sales and service liability and personal accidents.

So what is Motor Trade liability:

It is liability that is incurred

1. When the insured vehicle causes damage or bodily injury to a third person which is called public liability.
2. Damage or bodily injury caused to employees in the course of business.
3. Damage to products in the insured vehicle products in the policy holder’s property and damage done to property.
4. Liability incurred during
5. Repairing, testing or inspection of vehicles
6. iSales or supply of motor parts
7. iSales of motor vehicles.

Motor Trade Liability insurance covers a trader from claims against these liabilities and is a vital component for any motor related business to trade legally. I would like to remind you again that if you do not have motor liability insurance. You may be liable to compensate the full amount of any claims against you.

For a certain amount of premium you will able to insure your business from any future losses. Now that we know why motor trade liability is important it is imperative that we choose an insurance policy that gives us the maximum coverage at lowest price.

Black Friars is an insurance brokerage company that can provide us with insurance policies that best suits your needs and business requirements, but again there are insurance companies like Churchill Peacock Insurance AXA and NIG who provide a comprehensive tailor- made insurance policies for your business. Please ensure that the insurance company gives you a motor trade insurance certificate as it is required by law.