Motor Trade Insurance

By: EconomyWatch   Date: 26 May 2010

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Motor trade insurance provides coverage against damage to the vehicles, employees and any third party in the course of the motor trade business. Occupations covered under a motor trade insurance policy are car dealers, mechanics, goods transit, body repairers, car importers and recovery agents. For some of these businesses, buying motor trade insurance is a legal requirement. However, for others it is a precautionary step to secure against heavy losses due to unforeseen situations. The availability of a number of insurance agents and companies makes buying motor trade insurance convenient.

Types of Motor Trade Insurance Policies

Broadly, there are three types of motor trade insurance policies one can choose from:

Motor Trade Road Risks Policy: Any individual engaged in the motor trade business, full time or part-time, can qualify for this policy. This policy provides cover against damage while the vehicle is on the road or parked at the policyholder's address or business partner's location.

Liability Insurance: Such a policy shields the policyholder against damage due to liability factors. An employer's liability insurance provides cover against damage or bodily injury sustained by an employee in the course of business. Public liability insurance covers damage to a third person due to an accident by the insured vehicle. Sales and service indemnity insures the policyholder against damage or bodily injury arising from:

  • Sales or supply of motor vehicles including pre-delivery checks
  • Sales or supply of motor parts
  • Repairing, testing, maintenance or inspection of vehicles.

    • Comprehensive Insurance: This policy provides a wide range of cover, including business premises, stock material, machinery, equipments, sales and service liability, road risks, employer's liability and personal accidents.


    Tips to Buy Motor Trade Insurance

  • Check the credibility and credit score of an insurance company.
  • Check the claim settlement procedure and time.
  • Understand the personal insurance requirements to buy the most suitable policy.
  • Consider quotes from different companies.
  • Ask for detailed information from insurance agents/companies.
  • Look for additional benefits over and above the basic insurance needs.
  • Look for customer support facilities and availability of local branches.

    • Due to the commercial nature of motor trade insurance, it has several exclusions. It is highly recommended that one reads the policy disclosure agreement thoroughly to understand the terms and condition as prescribed by the company.


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