If you are in business as a motor dealer, one of the principal defences protecting the very existence of your business is likely to be motor trade insurance.
In this brief guide to motor traders’ insurance, we help to explain why that is:
- given the risks and the investment likely to be at stake, you want suitable, appropriate and comprehensive cover – at a competitive price;
- you might try scouring the internet for policies which appear to offer all that you need. But for the certainty of securing good value for money and precisely the protection to suit your business, a specialist broker, with expertise and experience in arranging insurance for motor traders, may be a sensible choice;
- the premises from which you are operating your dealership or workshop may represent your most valuable business asset – and needs the protection of appropriate insurance;
- these are premises – especially where motor vehicle repairs are carried out – may be more than usually vulnerable to fire and explosion (not to mention a host of other potentially damaging incidents);
- the Health and Safety Executive (HSE), for example, devotes a whole page of guidance on the prevention of fire and explosions in such premises – incidents which not only cause considerable damage but may also result in serious injury or even death;
Employers’ liability insurance
- if such an accident results in injury or even death to one of your employees, you may be held liable and ordered to pay a very substantial sum in compensation;
- to protect your employees’ rights to receive such compensation, the law requires that you hold a minimum of £5 million employers’ liability insurance, from which payment may be made;
Public liability insurance
- accidents may also happen – to customers, other visitors to your premises and passing members of the public – and once again you may be held liable and ordered to pay a large sum in compensation;
- although there is no legal obligation to hold public liability insurance as indemnity against such risks, the cover helps to ensure that you may meet these claims – rather than face what is likely to be an intolerable financial burden on your business;
- your public liability insurance also provides indemnity against claims arising from alleged defective workmanship on the part of your business, which results in financial loss or injury to your customers;
- a major insured event, such as loss or significant damage to your workshops or showrooms, or the breakdown of essential machinery or equipment, may lead to the loss of revenue otherwise generated;
- this is termed business interruption, and your motor traders’ insurance can include a degree of financial compensation (up to the limits prescribed in your policy) for such loss of revenue;
- you are a motor trader, so it is hardly surprising that motor insurance is going to play a large part in the type of insurance cover you arrange;
- this is designed to protect customers’ vehicles whiles under your care and to provide cover for the business use of your own vehicles, including those driven on accompanied demonstrations.
This short guide is unable to describe every aspect of every type of insurance for motor traders in any detail, but it may already be clear that the subject may become quite involved and encompass a wide range of risks. Securing the appropriate cover, therefore, is important to your business.