Road Risk Insurance

What is road risk insurance?

Road risk insurance is a minimum legal requirement for anybody driving vehicles in the motor trade. From sole traders to dealers, garages to mobile mechanics, road risks insurance allows you to drive for professional purposes.

Taking out a motor trade road risks insurance policy allows you to add demonstration cover for test drives. You can also add other protection, like employers’ liability and public liability insurance. And as your business grows, you can upgrade to a traders’ combined policy for more comprehensive cover.

What does a road risk policy cover?

Road risks insurance can cover:

• Customer vehicles left in your care, custody, and control – for example, a car left for servicing at a garage.
• Vehicles ‘in the trade’ – for example, a car purchased at auction for selling.
• Some business vehicles — in some cases, you can insure a commercial van under your motor trade policy, e.g. if you also work as a builder.

Check your policy carefully to make sure you have the cover needed.

Road risks insurance does not cover:

• Family fleets, as it isn’t designed to cover personal use. It’s not a multi-car policy. To purchase personal car insurance, you can get a quote from our sister company, Quoteline Direct.
• Vehicles expressly excluded from the policy. These might be high-performance sports cars or grey imports, for example.
• Other people’s vehicles. A motor trade policy is purely for cars being worked on or sold in the trade.

If in doubt, check your policy wording.

Third-party only, third-party fire and theft, or comprehensive cover?

Just like a private car policy, there are three levels of road risk insurance:

• Third-party only – covers injury or damage to third-party property or people, but offers no protection for the driven vehicle.
• Third-party fire and theft – adds cover for fire damage or theft to third-party-only cover.
• Comprehensive – offers the highest level of protection by providing cover for the vehicle driven.

With comprehensive cover, it’s worth bearing in mind that most motor trade policies will only pay the trade value of a written-off vehicle. For example, if a car sells for £10,000 on Auto Trader but only costs a dealer £7,500 to buy, you would receive the lower amount from the insurer. If you require additional cover, let us know.

Whichever option you pick, make sure to select an affordable excess level. You may find it cheaper to purchase an excess protection policy, which covers the excess in the event of an accident. In doing so, you can bring the overall cost of your policy down. Speak to us for more details.

Which businesses need road risks insurance?

All motor traders who drive vehicles for use in the trade need a road risks policy. This can include:

• Car dealers
• Mobile mechanics
• Service and repair garages
• Tyre fitters
• Breakdown and recovery operators
• Part-time traders
• Valeters
• Motorcycle traders
• Young motor traders
• Classic car restoration
• Body shops
• Vehicle sales
• Start up traders
• MOT stations
• Auto electricians
• Delivery & collection agents

To summarise, a business that buys, sells, services, or repairs vehicles is legally required to have road risks insurance before they get behind the wheel.

How much does motor trade road risks insurance cost?

Road risks cover starts at the equivalent of £8.73 per week* for third-party only insurance. Every trader has different circumstances, though, so prices can vary depending on several factors, including:

• Age and driving experience of named drivers.
• Previous motoring claims or convictions.
• The location where vehicles are kept overnight.
• The amount of cover required.
• Whether you choose third-party, third-party fire and theft, or comprehensive cover.
• The amount of excess you choose to pay on the policy.
• The type of vehicles you want to be covered.
• Your trade.
• Which insurer from our panel offers you the most suitable cover.
• The staff you employ.

Other factors can influence the cost of your policy, too. For a personal quote, get a road risks insurance quote online or get in touch with us for advice.

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What other covers can you get with road risks insurance?

Even if you are a sole trader or work part-time, you might benefit from additional motor trade insurance, including:

Employers’ liability and public liability cover

These liability covers protect against claims made by employees or members of the public for alleged injury or damage to people or property. Employers’ liability is a legal requirement for anyone who employs staff. Public liability is beneficial if people come on-site while work is happening, e.g. into a garage, where they might slip, trip, or fall.

Demonstration cover

Choose from unaccompanied demonstration cover (for safe test drives during the Covid pandemic) or accompanied demonstration insurance. These policies allow traders to demonstrate vehicles to purchasers before they buy them.

Motor trade combined cover

Larger motor traders will benefit from additional motor trade combined cover. This protection can cover your business premises, tools, stock of vehicles, money stored on-site, and much more – all in one policy, with one renewal date.

Still got questions? Read our ultimate guide to motor trade insurance for more help.

Get your road risk only motor trade quote today.