Written by Michael Foote, Insurance Expert
The level of cover you’ll need as a motor trader depends on your line of work, whether you operate from premises, and if you employ staff. This guide breaks down common business types within the motor trade and the typical insurance cover required for each.
Author Note: As always, if you want an accurate quote or any advice for your particular business, fill out the short quote form via the “Get Quotes” button below to get free, no-obligation advice and accurate insurance quotes from up to 5 motor trade specialists.
Mechanics
Running a garage or mobile repair service means working on customer vehicles and dealing with equipment. Most mechanics will require:
- Public Liability: £2 million to £5 million, depending on customer footfall and contracts
- Employer’s Liability: £10 million (legal minimum if you employ anyone)
- Road Risk: Third-party minimum, but comprehensive preferred for test drives
- Tools Cover: Varies – insure total value of diagnostic and hand tools
- Premises Cover: Buildings/contents insured at full reinstatement value
Learn more about cover for mechanics
Car Valeters and Detailers
Working on customer vehicles involves risks to paintwork and interiors. You may need:
- Public Liability: £1 million minimum, often £2 million if mobile or high volume
- Employer’s Liability: £10 million if hiring staff, even part-time
- Treatment Risks: Add-on required to cover damage during valeting/detailing
- Road Risk: Required if you move client vehicles
Find the right insurance for car valeters
Tyre Fitters
Whether mobile or operating from a premises, tyre fitters are exposed to roadside risks and public interaction.
- Public Liability: £2 million is typical, but £5 million often needed for commercial contracts
- Employer’s Liability: £10 million mandatory if staff employed
- Road Risk: Needed if vehicles are moved
- Premises/Stock Cover: Optional but recommended for equipment, tyres, etc.
Cover options for tyre fitting businesses
Car Traders (Dealers)
From home-based traders to forecourts, insurance needs vary:
- Road Risk: Third party at a minimum – many opt for comprehensive for stock vehicles
- Public Liability: £2 million standard, £5 million for large forecourts
- Employer’s Liability: £10 million if you employ valeters or sales staff
- Stock Cover: Cover total market value of cars onsite
Compare motor trade insurance for car dealers
MOT Stations
Operating a test centre means strict regulation and constant footfall. You’ll likely need:
- Combined Cover: Required to cover buildings, contents, ramps, and tools
- Public Liability: £5 million often expected due to high footfall
- Employer’s Liability: £10 million minimum
- Business Interruption: Optional but valuable for downtime during equipment failure
- Road Risk: Needed for customer test drives
Insurance requirements for MOT stations
Scrap Metal Dealers
Scrap dealers face unique risks tied to environmental liability and dangerous goods.
- Public Liability: £5 million is common due to hazardous environment
- Employer’s Liability: £10 million for site staff
- Environmental Liability: Add-on or separate policy may be needed
- Road Risk: If vehicles are collected or transported
Explore cover options for scrap dealers
Car Transporters
Businesses moving vehicles commercially require specific cover:
- Road Risk: Third party is the legal minimum – comprehensive for fleet vehicles preferred
- Goods-in-Transit: Covers customer vehicles in transit – typically £50k to £100k per vehicle
- Public Liability: £2 million to £5 million depending on depot risk and contracts
- Employer’s Liability: £10 million if you have drivers or depot staff
See insurance considerations for car transporters
Businesses with Premises
If your motor trade operation runs from a physical location:
- Buildings & Contents: Must reflect full rebuild and equipment replacement cost
- Public Liability: £2 million minimum – £5 million preferred
- Employer’s Liability: £10 million mandatory
- Stock, Tools, and Business Interruption: Consider total exposure
Insurance for traders with a business premises
Conclusion
Every motor trade business faces different risks, and insurance needs vary. Understanding your cover requirements helps avoid underinsurance and ensures you’re protected against the most likely issues in your line of work.
