Six common motor trade insurance FAQs

Setting up in the motor trade can be both challenging and exciting. In addition to organising the premises, equipment and supplies, it is essential that you have adequate insurance.

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If you have never looked into insurance for the motor trade before, it can be a little overwhelming. Here are six of the most frequently asked questions by people in your position.

1. Do you have to be registered with a motor trade organisation to get insurance?

According to Institute of the Motor Industry (IMI), being a member of a trade organisation can help you in terms of training and information; however, membership is not compulsory for insurance. You may, at some stage, be required to demonstrate that you are running your business properly and may need to provide evidence that you are a motor trader.

2. Do you have to notify changes in circumstances?

When you take out motor trade insurance through a broker such as, you have to give details of your circumstances. It will be a condition of your insurance policy that any material changes must be notified to your insurer.

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3. Are your own vehicles covered?

If you have declared that they are your own vehicles when the policy was set up and requested that they are insured as part of the policy, they will be covered. It is important to note that some vehicles are restricted and will not be covered.

4. How do you go about notifying sales and acquisitions of vehicles?

Usually, this is via an email address or through an online portal. Your insurer has the responsibility to inform the Motor Insurance Database (MID) of any changes within a certain period of time, so it is important that you let them know quickly.

5. When does the insurance cover commence?

The cover starts as soon as you have paid for it. If you are paying with a debit or credit card, the funds are transferred immediately and the cover starts straight away. Cheques can take some time to clear, so you will have to contact the insurer to find out when the cover starts.

6. Can other drivers be added?

Yes, as long as they can prove that they are an employee of your business. This may need tax or NI records to be produced.