The Essentials Of Insurance For Trade Plate Drivers

​For many in the motor trade, trade plates are an essential tool of the job. They allow drivers to legally move untaxed or unregistered vehicles without the need to register each one individually. This is especially important for collection and delivery agents transporting vehicles for dealerships, auctions, or private buyers.

However, while trade plates make life easier on the road, they do not provide insurance themselves. To operate legally and protect both your business and your customers, you need the right motor trade insurance in place.

Why Insurance Matters When Using Trade Plates

Using trade plates enables you to drive untaxed and unregistered vehicles, but it does not mean those vehicles are automatically insured. Without a motor trade policy that specifically covers trade plate use, you would be driving uninsured, which could lead to serious legal and financial consequences.

While motor trade insurance itself isn’t a legal requirement, it is the only way to obtain the correct insurance to drive vehicles under trade plates. Without it, you would be driving uninsured, which is illegal.

When you arrange cover, your insurer will register the trade plate details on the Motor Insurance Database (MID). This ensures your plates are recognised by Continuous Insurance Enforcement (CIE) cameras, helping you avoid penalties, fines, or even prosecution for uninsured driving.

Why Personal Car Insurance Isn’t Valid

Standard car insurance policies, whether for social, domestic, pleasure, or commuting purposes, are not valid when driving under trade plates. Trade work carries very different risks, and contracts for delivery often require indemnity levels of up to £100,000 per vehicle.

Only a dedicated motor trade policy, or “trade plates cover insurance”, is designed to handle these risks. Attempting to rely on personal car insurance would leave you unprotected if a vehicle were damaged, stolen, or involved in an accident while under your care.

What Cover Does A Motor Trade Policy Provide For Trade Plates?

A motor trade policy can be tailored to reflect the way you use your trade plates. At its most basic, it includes road risk insurance, which provides the legal minimum cover to drive vehicles on public roads. This usually comes in three levels:

• Third-party only
• Third-party, fire and theft
• Fully comprehensive cover

Policies typically name specific drivers, though options are available to add multiple plates, additional drivers, and even vehicle transporters to the same policy. Many businesses also choose to extend cover with extras such as legal expenses, employers’ liability, and public liability insurance.

The flexibility of these policies means you can create a level of protection that balances affordability with the cover required for your contracts.

Getting Trade Plates For Your Business

Before you can apply for trade plates, you will need to have valid insurance in place, which means getting a motor trade policy that covers the use of trade plates. Once insured, you can apply for a trade licence and complete a VTL301 form through the DVLA. You’ll also need to provide proof that you are operating as a legitimate motor trade business.

Failing to have the correct insurance in place before using trade plates can invalidate your licence and leave you open to penalties, not to mention reputational damage with clients.

Protecting Your Business On The Road

Trade plates make moving vehicles more efficient, but it’s your insurance that keeps you compliant and protected. By ensuring your trade plates are registered on the MID and backed by a tailored motor trade policy (referred to as trade plate driver insurance), you can carry out collection and delivery work with confidence.

At Crowthorne, we specialise in motor trade insurance that includes full trade plate insurance. With options to cover multiple plates, vehicle transporters, and high-value indemnities, we can help you protect your business, your clients, and your reputation. Contact us today.