Insurance For Part-Time Motor Traders

Motor trade insurance allows you to drive vehicles in connection with your business, such as customer vehicles or those you’re buying, selling, or repairing.

However, it doesn’t mean you can drive any car for personal use unless it’s specifically included in your policy.

Always review the terms of your coverage in the policy schedule to determine which vehicles are covered and under what conditions.

If you’re a motor trader, you need road risk insurance and various types of additional covers to protect your livelihood.

From accidental damage to customer vehicles and costly liability claims, a proper motor trade policy safeguards your finances and reputation.

As a result, your business can operate smoothly even when unexpected events happen.

From our experience, we’ve been able to insure motor traders from as little as £39.37** per month.

However, the cost of your premium depends on many factors, such as the size of your business, the cover you need, and the type of motor trade work you do.

** The lowest motor trade insurance premium shown is based on our lowest available price, £392, paid in ten monthly instalments of £39.37, totaling £460.34. This includes a £66.64 deposit and interest charged at a 21% APR. The price is based on the most affordable policy we sold in 2025 under ideal risk conditions, and may not reflect the quote you receive based on your individual circumstances.

Yes, it’s entirely possible to be a part-time motor trader. In fact, many people start this way to test the waters before going full-time.

You can operate in your spare time, trading a few cars a month, often from home or through online platforms like AutoTrader, eBay Motors, or Facebook Marketplace.

As long as you treat it like a business by following legal requirements, registering properly, and keeping accurate records, it’s a legitimate and common way to get into the industry.

Getting started in the motor trade is relatively straightforward.

First, you should register as self-employed or set up a limited company, depending on how you want to operate. Then, you’ll need motor trade insurance to legally drive and sell multiple vehicles.

Some traders also apply for trade plates from the DVLA, which allow you to drive untaxed vehicles legally for business purposes. Once that’s in place, you can begin sourcing vehicles from auctions, private sellers, or part exchanges, and then advertise them for sale online or locally.

Make sure to keep proper sales records, as this can contribute to proving you’re a legitimate motor trader when it’s tiem to renew your cover!

Part-time motor trade insurance is often cheaper than full-time cover, primarily because the risk is a bit lower. Essentially, this is because you’re spending less time driving, handling fewer vehicles, and probably not using commercial premises. 

That said, the actual cost depends on your personal driving history, the type of vehicles you drive, your location, and whether you want coverage for things like tools, premises, or liability.

Not all insurers offer policies for part-time traders, so having a chat with our experts can help you find the best deal.

There’s no fixed number of cars you can sell before you’re considered a trader. As a general rule, if you sell more than three to six cars in a year, making a profit, HMRC and the DVLA may consider you a trader.

Even selling just one car can qualify as trading if you do so with the intention of making a profit and repeat the activity.

The key factor is your intent and frequency, not just the number of vehicles. If you are buying and selling regularly, you need to register as a trader and ensure you’re following consumer and tax laws.