Any business dealing in the sale, repair, or purchase of cars needs a motor-trade insurance cover. In fact, dealers sign up for additional covers as they need to protect the vehicles, parts, and other equipment used in such settings. Motor vehicle dealers and body shop owners can reduce this cost by identifying areas that they can reduce their claims and those against them. The text below highlights smart tips to reduce your motor-trade insurance.
Perform a Full Business Activities Review
The motor industry experiences rapid changes over short periods. Monitoring these changes can help a business make significant savings on the monthly or yearly premiums. To begin with the type of business you are running affects the motor-trade insurance you pay. A motorist should be straightforward about the kind of business he is running as some motor-trade businesses attract higher premiums than others. Businesses that specialize in vehicle salvage, breakdowns, and recovery are riskier compared to motor-trade firms selling used cars.
The value of the vehicle also determines the amount of premiums paid. Since companies allocate a certain percentage to the depreciation of motor vehicles, motorists should liaise with insurance providers to ensure that the vehicle reflects the actual trade value. Motor-trade owners should also review all their current employees to ensure they are not insuring those who no longer work for them. And since motor-trade businesses use different types of vehicles, owners should review insurance policies for all the cars to identify areas they can save.
Insurance providers assume young drivers (usually under 25 years) to be more prone to accidents than their older counterparts. As a result, insurance providers charge higher premiums to the young motorists. Motor-trade owners can hire older drivers to reduce the insurance burden.
Motor-trade businesses need two types of insurance covers- a road risk policy and a combined policy. Road risk policies are for dealers who deal in vehicles they don’t own; they can, however, buy, sell, or repair these automobiles. A combined policy offers all the benefits of a road risk policy along with protection against loss or damage of the vehicle stored at the dealer’s premises. Dealers should determine the kind of policy they need for their premises to minimize insurance costs.
Combine Your Insurance Policies
A motor-trade cover is one sure insurance a motor-trade business can’t do without. However dealers are compelled to sign up for additional policies as they deal with various items. They may sign up for five or more policies to cover the vehicle, tools and equipment, drivers, and road risks, among others. Motor-trade owners can consolidate all such policies and negotiate for more favorable terms with their providers to help reduce the administrative tasks and the amount of insurance paid.
Paying Upfront & Protecting Your Claims Bonus
Making monthly insurance payments is more expensive than annual payments. This is because insurance providers charge an additional 10% for making monthly payments. Motor-trade dealers can avoid such extra charges by making up-front payments and maintaining a good record with few claims. Your provider may also award you with a no claims bonus.
With insurance costs making up the largest expenses for most motor-trade businesses, any dealer would appreciate ways to reduce this cost. The smart tips discussed above come in handy.