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