Trade plate insurance

Trade plates are temporary registration plates used by businesses in the motor trade industry, such as car dealerships or mechanics, to legally drive vehicles on public roads without having to register and tax each one. They are a vital tool for businesses that need to regularly move vehicles but don’t necessarily own them. They can be used for test drives, moving vehicles between sites and driving them as part of repair or service work. Trade plates and trade plate insurance provide cover for cars while they’re being driven on a public road. As the cars themselves aren’t continuously registered, the motor trade plate insurance covers them to ensure they are legally and adequately covered in the event of an accident.

Importance of Trade Plate Insurance

Trade plate insurance is crucial for multiple areas of the motor trade, including dealerships and mechanics. It allows you to legally move vehicles on the road that you don’t own, or stock vehicles in your possession for motor trade purposes. Without trade plate insurance, your only legal avenue is to separately register and tax each individual vehicle every time you need to take it on the road.

What Do You Get?

At Prime Cover, we can create a trade plate insurance policy just for you, built to cover all your needs. Trade plate insurance policies with us allows for cover in multiple areas of the motor trade industry.

  • Full road risk coverage when delivering vehicles using a transporter, trailer or trade plates
  • Cover for business partners, employees and spouse (if named on the policy)
  • Protection for stored vehicles, as well as freight forwarding and covering your risks if you work for a national recovery service
  • Coverage in the UK (specialist policies available for cover abroad)

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Understanding Trade Plate Insurance

Trade plate insurance and trade plates provide coverage for a range of risks which includes accidental damage if the car is involved in an accident. It protects against theft, vandalism or fire which might damage the car while it is in the policyholder’s possession and protects against damage to property, caused by the vehicle – and this is a legal requirement. There is a wide range of businesses involved in the automotive industry that need to frequently move cars for their operations, whether for test driving or transportation to other sites for sales.

Not everyone can obtain trade plates, they are available for vehicle manufacturers, dealers, repairers, testers and vehicle delivery agents. The business must be able to prove its legitimacy in the motor trade to qualify. Legally they have to be positioned clearly at the front and rear of the car, where they can be easily read, and they shouldn’t be used to cover the car’s registration number.

They can only be used for business purposes related to the trade and not for personal, social or domestic purposes as this can lead to a £5,000 fine or even imprisonment. Trade plates should be registered with the DVLA (Driver and Vehicle Licensing Agency) and the MID (Motor Insurance Database) and, as they are usually valid for 6 – 12 months, need to be regularly renewed to continue using them.

Coverage and Benefits of Trade Plate Insurance

A car dealership will have potential buyers wanting to take a possible purchaser out for a test drive, and trade plates allow the car to be taken out on the road whilst ensuring it’s covered if any accident occurs. Similarly, if a car needs to be transported to another location, such as for delivery or repair and the car isn’t insured by the owner, or road taxed, then having trade plate insurance and plates ensures coverage for both car and driver for that period of time, so long as the driver is named on a valid motor trade insurance policy.

The benefits of trade plate insurance to those in the automotive industry are wide and varied. Most of the vehicles traders are dealing with and transporting are very short-term and having trade plates and trade plate insurance means they don’t have to spend lots of time and money having to register and tax each vehicle. Several of the pivotal benefits of trade plate insurance in the UK are listed below.

Efficiency and cost-effectiveness

They allow vehicles to be legally used on the road without individual registrations.

Flexibility

Often cars need to move on short notice between sites, for delivery and for test drives. It also allows driving any vehicles in a diverse range to be driven under the same plates.

Legal compliance

A legal requirement, UK trade plate insurance and plates protect from potential fines, legal action and damage to reputation

Business operations

Car dealerships need to allow test drives as part of their sales process, and mechanics need to test vehicles after service or repairs to check everything is in order.

Protection against liabilities

Issues can arise from damage or accidents with third parties.

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Key Features of Trade Plate Insurance Policies

Businesses can apply for trade plates if they’re a motor dealer, trader or vehicle tester, meaning your business either sells, manufactures or tests vehicles such as other people’s cars on public roads. Also, if you collect or deliver vehicles, and this is all that your business does or if it also manufactures or repairs vehicles, then you can apply for trade plates and will require trade plate insurance. The vehicles you want to use trade plates on should be in your possession for a temporary period of time and for trade purposes. You can’t apply for vehicles you own or drive for personal use.

The requirements for applying for trade plate insurance will be evidence of certain documents and information. Trade plates themselves can be applied for from the DVLA and you may need to prove your legitimacy within the motor trade, as well as a motor trade certificate. When you have applied for, and received your trade plates, these must be registered on the MID (Motor Insurance Database), and the insurance policy can be set up to give you the peace of mind that your business, drivers and vehicles are covered.

How to Choose the Right Trade Plate Insurance

Finding the right insurance provider, policy and cost for your trade plate insurance is important and it’s best to get it right first time. Some steps to help you make an informed decision include:

  • Assess your needs and list exactly what you need and what your business covers.
  • Research providers – a specialised motor trade insurance provider is going to be able to understand and tailor to your needs better than a general insurer.
  • Compare quotes – if you get multiple quotes, you can compare the sense of the market rate and help you find the most ideal policy for your requirements.
  • Check coverage limits - make sure it covers the full value of the vehicles in your custody or control.
  • Look for reviews – other customers can help you discover if they’re a reliable service provider, what their claims process is like and overall reliability.
  • Consult a specialist in the area of motor trade insurance.

While cost is a significant factor, it shouldn’t be the only consideration. While considering how much trade plate insurance is for your business, it’s important to balance the quote with the reliability of the provider, the breadth of cover and the quality of customer service.

Cost Factors and Premium Calculation

Trade plate insurance premiums are calculated based on a range of factors that assess the risk associated with the activities undertaken by the business. The higher the perceived risk, the higher the premium is likely to be. The main factors that contribute to the cost of trade plate insurance are:

  • Level of cover.
  • Value and type of vehicles.
  • Business location.
  • Claims history.
  • Driver details such as age, experience and driving record.
  • Business operations – size and nature of the business.
  • Excess amount you agree to pay towards a claim.
  • Coverage extensions and add-ons.
  • Payment method.

The cost of your trade plate insurance is calculated based on the insurer’s assessment of the risk involved in insuring the business and vehicles. The actual calculation is made by combining all these factors with complex mathematical and actuarial formulas with sophisticated software tools.

Different insurers may weigh different factors based on their own experiences, strategies and objectives, which is why premiums can vary from one broker to another – and why comparing quotes from different insurance companies is important. Prime Cover has vast experience in finding relevant cover to suit multiple requirements for motor traders needing trade plate insurance, so get in touch today for a free, no-obligation quote.

Why Might I Need Trade Plate Insurance?

Businesses and people operating in the motor trade industry will need trade plate insurance. Trade plates are temporary vehicle registration plates used for unregistered vehicles, and they offer legal protection for those who utilise them.  

You could face fines, legal repercussions and possibly losing your trade license if you don’t have the right trade plate insurance. When a vehicle is being transported for inspection, maintenance or sale, this insurance guards against any mishaps, theft and damage. It guarantees adherence to legal regulations, protecting your business and means of subsistence and providing peace of mind in a heavily regulated sector. Therefore, if you require trade plate insurance, you must get it from a reputable trade plate insurance provider, like Prime Cover. 

Who is Eligible for Trade Plates?

  • Motor Traders 
  • Motor Manufacturers 
  • Leasing Companies 
  • Vehicle Collection Agents 
  • MOT Vehicle Testing Stations 
  • Motor Repairs/Body-shops   

What Can Trade Plates Be Used For?

Trade plates are temporary registration plates for vehicles at are mostly used by individuals and businesses in the motor trade sector. They permit the lawful transportation of unregistered automobiles for a number of uses, including test drives, the movement of recently manufactured vehicles, the removal of vehicles for maintenance and the exhibition of vehicles to prospective purchasers. Trade plates provide a practical means of conducting business while adhering to rules and regulations.  

FAQs

Trade plate insurance is specialised insurance designed to give you cover to legally move vehicles on public roads, using trade plates.

If you work in a sector of the motor trade that involves moving vehicles that aren’t taxed, you’ll need trade plate insurance. Most commonly, this applies to the likes of vehicle dealerships, mechanics and mobile mechanics, vehicle transportation services, and even car manufacturers.

To obtain trade plates, you need to register with the government and demonstrate your business’s need for them. Proof of insurance is often required before issue. Once acquired, they then serve to notify police and other officials that you’re driving a vehicle in a professional capacity, circumventing the need to register and tax lots of individual vehicles.

Trade plate insurance covers the vehicle on the road so that the vehicle can be legally moved, transported, or tested.

You can apply for trade plates if your business sells vehicles, manufactures or repairs vehicles, and/or tests other people’s vehicles on public roads. Vehicle delivery services will also be eligible if that is the only thing your business does, or you also manufacture or repair vehicles.

Trade licences and trade plates expire on either the 30th of June, or 31st of December, and you cannot get a trade licence for less than six months or more than twelve months at a time.

Consequently, when you initially apply for your trade licence, it will be valid for either six or twelve months, based on when you applied. Once you have your trade plates, you can renew them for six or twelve months at a time.

No, trade plates must only be used for the purpose that you stated when you registered for them, and they will not be granted for personal use.

To issue you with trade plate insurance, we’ll need to see documents such as your driving licence and any no-claims proof.

Like other insurances, trade plate insurance costs will be based on factors such as the number, age and history of drivers, the extent of cover that you choose, your claim history, and the area in which your business operates.

When selecting the right trade plate insurance provider, one of the first things you’ll need to establish is their level of experience working in the motor trade, as well as their ability to create custom policies, their customer reviews and how good their customer service is.

At Prime Cover, we have years of experience working almost exclusively in the motor trade and can create bespoke policies to suit your needs. We also offer a 24/7 claims and support line and are here for you whenever you need.

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