What’s the difference between car insurance and motor trade insurance?

When insuring a car it’s important to get the right type of policy. As an individual or family member, a conventional motor policy – either comprehensive or third party fire and theft – is normally all you need.

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However, if you are involved in the motor industry and regularly need to drive a range of different vehicles, including cars belonging to customers, to ensure that you are properly covered you need to have a specialist policy.

What’s covered

The principal difference between private and trade policies is that a private policy relates to a specific vehicle. This means when you change your car you need to inform your insurer and get the policy updated.

Motor trade insurance, on the other hand, covers you for a variety of different vehicles so you don’t need to revise or take out a fresh policy for each one. This can include cars that belong to your customers as well as cars that you have in stock to sell. A trade policy from a supplier like https://www.quotemetoday.co.uk/motor-trade-insurance will allow you to drive a wide range of vehicles including high performance models that might otherwise be tricky to insure.

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Complying with the law

Some private policies have a ‘driving other vehicles’ clause that allows you to drive other cars with third party cover. However, this doesn’t apply to driving vehicles for the motor trade, and you won’t be covered if you try to do so.

Similarly a motor trade policy does not mean that anyone can drive a vehicle. The police have cracked down on this in recent years, and it’s important not to use a trade policy as a way to cheat the system. Look at the detail of the policy and make sure you know what is and isn’t covered.

If, however, you have personal vehicles, for yourself and your spouse for example, you will usually be allowed to add these to your trader’s policy as vehicles for social use – although there may be a small extra cost involved.

Motor insurance is a complex area and it’s easy to get caught out if you don’t understand the rules or you try to cut corners. It’s therefore important to take the time to understand what is and isn’t covered and to get a policy that meets your needs.

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