If you’ve ever considered starting a business in the motor trade but aren’t sure exactly what is required then the information below should make for interesting reading.

What types of motor trade businesses are there?

The main types of motor trade businesses are those that make money through buying, modifying or repairing vehicles. Some typical motor trade business types include –

• MOT garages
• Car showrooms
• Auction houses
• Mechanics
• Valeters

Do you need premises?

Whether or not you need a premises will depend upon what type of business it is. A mobile mechanic doesn’t need a premises in theory since they’re usually working on the road and using tools from their van. However if you’re doing something such as car sales or MOT repairs, then you’ll certainly need a premises. 

What type of insurance do you need?

The exact type of cover you need will depend on the type of motor trade business you have. For example if you’re a mechanic then you’ll want to get a UK mechanics insurance policy that covers you for the risks associated with that job.

To qualify for motor trade insurance you need to –

• Be at least 21 years old
• Have a full UK drivers licence
• Be able to prove you work in the motor trade

What types of policies are available?

The main types of policies are –

• Road risks – Road risks insurance is essential for most types of motor trade businesses. It will allow the policy holder and their employees to work on customer vehicles as well as transporting them. It’s also possible to get cover for your personal vehicle as well as any vehicles your business owns.
• Part time traders insurance – You can also get part time traders insurance policies from sites like https://www.traders-insurance.com/part-time-traders-insurance. Part time traders insurance will cover you only for the period of time you require.
• Combined motor trade insurance – A combined motor trade insurance policy providers cover for all aspects of a motor trade business, from vehicles to the business premises, tools, stock and cash.

How much will it cost?

The cost of a motor trade insurance policy will depend on a number of variables; some of the most important being –

• Your age – Your age will always play a factor when it comes to the cost of insurance. Under 25s can expect to pay considerably more for a policy simply because they’re considered higher risk.
• The type of business you need cover for – The type of business you need cover for will also play a role in how much your cover costs. Things like the size of your business, the type of vehicles you deal with and the number of employees you have will be taken into account.
• The level of cover you take out – As you would expect a basic road risks insurance policy will cost less than a policy that has many cover options such as liability claims, legal fees, premises cover etc.