Motor Trade Insurance. Hmm...

[Mad Mark 0]

Hi guys,

I hope you're all well. 

So I'm new to the business and looking to start out with maybe 1 car at a time in the hope to sell 3-4 cars a month, however I've hit a major snag after putting in the research for the last 2 weeks I probably should have checked motor trade insurance prices first - bummer!

Phoned up Bollington insurance which I've read people got good deals from on here and was quoted over £3,000 for the year, which I just can't afford. The kind chap however did say that I'd be maybe best going down the temporary insurance route for each car I get so it allows me to drive it home etc for around £50 a car. 

The only issue I then seen was what if a buyer wants to test drive the car, would they require to be insured or do most buyers just chance it? As I'm sure there are many private sellers out there just selling the odd car without motor trade insurance.

And if the buyer did just chance it on a test drive and we got pulled over by the police who would be at fault and be hit with the points? 

Appreciate any feedback. 

[Row 71]

If you are doing 3 or 4 a month then pay for proper insurance then you don't have to worry.

[Mad Mark 0]

4 minutes ago, Row said:

If you are doing 3 or 4 a month then pay for proper insurance then you don't have to worry.

Thanks for the reply. What do you mean by proper insurance? 

[D&M 66]

17 minutes ago, Mad Mark said:

And if the buyer did just chance it on a test drive and we got pulled over by the police who would be at fault and be hit with the points? 

 

It be the driver at the time of being pulled over!

So the buyer gets to test drive your car, pulled over, 6 points and your car towed away. Can't see that being a sucessful sales pitch! Oh, and don't forget your Trade plates too - well, you can't have those without proof of insurance, so you've got no road tax either.

Phone around and get some other quotes. Do it properly, or not at all. The bear minimum is to be legit on the test drive!

[Mad Mark 0]

1 minute ago, D&M said:

It be the driver at the time of being pulled over!

So the buyer gets to test drive your car, pulled over, 6 points and your car towed away. Can't see that being a sucessful sales pitch! Oh, and don't forget your Trade plates too - well, you can't have those without proof of insurance, so you've got no road tax either.

Phone around and get some other quotes. Do it properly, or not at all. The bear minimum is to be legit on the test drive!

You seem to know your stuff which is helpful. Do most buyers want to test drive the car I take it? Was thinking of offering at least a 3 month warranty to cover them for any issues. But I can only afford a car for £900 - £1000 at auction. With expenses and tax taken into consideration I'd be looking at £300 - £500 profit per car and that's hoping nothing major needs done to the car. Guess a mechanics and condition report at auction would help to prevent any extreme costs, if it didn't show anything major? Thanks

[D&M 66]

Yes, almost all buyers will test drive cars that you are selling in the £1000-£2000 range.

Its unlikely that you will be buying cars with reports in that price bracket. May be more sensible for you too look out for cheapies for sale privately so you can have a good viewing and a test drive.

You need to cover yourself with your paperwork. I'd highly recommend downloading the 'How to be a car dealer' guide on the forum as it'll give you much more helpful advice.

Every day is a school day, I don't consider myself an expert. There are a lot more experianced voices than mine on the forum, so pay attention to the advice given to you.

But first, insurance is a must. You'll need to to register with most auction houses, to collect your cars and run them too and from MOTs / garages, to test drive. Also, you'll be covered for SD&P on your own personal car too. When you work out the costs, you'll see that trade insurance is probably more cost effective than day insuring a car every time you want to use it.

 

[Mad Mark 0]

Cheers I'll take a look at the how to be a car dealer guide. I watched this video https://www.youtube.com/watch?v=yTBicGsgHXo and he made £900 profit (before tax) on the car, for a car he bought for £1000. Would you say profits like this on a £1000 car at auction or bought privately are few and far between, if so what would you say are more realistic profit figures for buying a car for £1000? 

Are there any insurance companies you'd recommend for cheap motor trade insurance for new dealers? 

Sorry for all the questions. I've fired in a few hearts for your help happy to keep them coming!

 

[Casper 272]

Try think insurance last time I used them they got me a good price and have helped a few other traders I spoke to when starting out 08002218077 should be there number there also very flexible with motor trade policy types to get you the one most suitable 

like you I was getting quoted daft money when I first started out years ago and someone recommended them to me 

hope this helps 

Edited December 18, 2019 by Casper

[justina3 518]

3 hours ago, Mad Mark said:

Cheers I'll take a look at the how to be a car dealer guide. I watched this video https://www.youtube.com/watch?v=yTBicGsgHXo and he made £900 profit (before tax) on the car, for a car he bought for £1000. Would you say profits like this on a £1000 car at auction or bought privately are few and far between, if so what would you say are more realistic profit figures for buying a car for £1000? 

Are there any insurance companies you'd recommend for cheap motor trade insurance for new dealers? 

Sorry for all the questions. I've fired in a few hearts for your help happy to keep them coming!

 

Almost impossible to obtain that margin, flipping cars is an experienced outfit who has been in the trade for years hardly a newbie. 
 

auction houses will eat you up and spit you out before you even know what’s happened your more likely to lose £900 than you are to make it, try buying private allowing you to haggle hard and test drive the car must importantly avoid fees.

[Arfur Dealy 823]

8 hours ago, Mad Mark said:

Hi guys,

I hope you're all well. 

So I'm new to the business and looking to start out with maybe 1 car at a time in the hope to sell 3-4 cars a month, however I've hit a major snag after putting in the research for the last 2 weeks I probably should have checked motor trade insurance prices first - bummer!

Phoned up Bollington insurance which I've read people got good deals from on here and was quoted over £3,000 for the year, which I just can't afford. The kind chap however did say that I'd be maybe best going down the temporary insurance route for each car I get so it allows me to drive it home etc for around £50 a car. 

The only issue I then seen was what if a buyer wants to test drive the car, would they require to be insured or do most buyers just chance it? As I'm sure there are many private sellers out there just selling the odd car without motor trade insurance.

And if the buyer did just chance it on a test drive and we got pulled over by the police who would be at fault and be hit with the points? 

Appreciate any feedback. 

Welcome Mark. You will need insurance. The link below explains what most insurance providers will require from you. 
 

https://www.onesureinsurance.co.uk/motor-trader-insurance

[Rory RSC 596]

One of the cheap ones like tradewise or tradex to get started, bollington type broker a bit further down the line. Everyone has to start somewhere.

[Mark101 536]

9 hours ago, D&M said:

It be the driver at the time of being pulled over!

Wrong! It will be the driver AND the vehicle owner for allowing that person to drive without insurance.

[have a word with the wife 299]

18 minutes ago, Mark101 said:

Wrong! It will be the driver AND the vehicle owner for allowing that person to drive without insurance.

Correct, and some customers will say there insurance covers other cars, it does'nt, because there will be no insurance on the car that they are test driving, if they don,t insure it "till they get home" after purchase, i tend not to get involved if i can help it other than, if your local, i will deliver it, a common thing amongst many car dealers i reckon this "i will insure it when i get home " ?

[MarkTVS 209]

From memory most auction houses will want a copy of your trade insurance before allowing you to open a trade account. 
 

i May be wrong with that but that’s how it was years ago when I set up my accounts

[trade vet 704]

Hi Mad Mark

The bottom line if you have no experience.If you haven’t got 20 grand don’t even bother and if you have ,be prepared to blow most of that in the first 18 months.As for Flipping Cars,he seems a good guy but he only made 3 grand last year so he may not be as good at this job as you think.The guys on here who do well,despite what they say put in huge effort and work very hard and regularly cope with set backs that cost a lot of money.This job is now very complex and you need rhino skin to compete,so good luck.

[Casper 272]

19 minutes ago, MarkTVS said:

From memory most auction houses will want a copy of your trade insurance before allowing you to open a trade account. 
 

i May be wrong with that but that’s how it was years ago when I set up my accounts

Think it's still the same mark tvs I know I provided it when i opened my ones but to be fair like you they've been open years 

also have a lovely Christmas and new year 

Edited December 18, 2019 by Casper

[15Cars 16]

9 hours ago, Mad Mark said:

Cheers I'll take a look at the how to be a car dealer guide. I watched this video https://www.youtube.com/watch?v=yTBicGsgHXo and he made £900 profit (before tax) on the car, for a car he bought for £1000. Would you say profits like this on a £1000 car at auction or bought privately are few and far between, if so what would you say are more realistic profit figures for buying a car for £1000? 

Are there any insurance companies you'd recommend for cheap motor trade insurance for new dealers? 

Sorry for all the questions. I've fired in a few hearts for your help happy to keep them coming!

 

As a relative newcomer (140 sold so far) if I had to offer one piece of advice for new starts,  it would be to avoid the major auction houses atm - especially at the £1000 range!

Edited December 18, 2019 by 15Cars

[JA Trader 58]

11 minutes ago, 15Cars said:

would be to avoid the major auction houses

Agreed 6 months ago it was much cheaper not sure what has happened.

[15Cars 16]

33 minutes ago, JA Trader said:

Agreed 6 months ago it was much cheaper not sure what has happened.

Agreed, I had a good time in the summer. I think 69 plate sales have been crap hence the lack of nice straight part exchanges.

I'm in awe of some of the regular 'traders' at my local auction house buying the current crop of shit from the dealer part exchange events. How they make a profit is beyond me - I clearly have a lot to learn

[Rory RSC 596]

1 hour ago, trade vet said:

Hi Mad Mark

The bottom line if you have no experience.If you haven’t got 20 grand don’t even bother and if you have ,be prepared to blow most of that in the first 18 months.As for Flipping Cars,he seems a good guy but he only made 3 grand last year so he may not be as good at this job as you think.The guys on here who do well,despite what they say put in huge effort and work very hard and regularly cope with set backs that cost a lot of money.This job is now very complex and you need rhino skin to compete,so good luck.

For once I agree.   Every trader I know who does well works incredibly hard. It has to be almost obsessive and 247. You can't be motivated all the time, no one can. You have to be really disciplined and keep on at it.  Also in the current day and age most of the businesses I consider a success and most of the people who seem to do well don't have prior motor trade experience.  I sometimes think 'the way it was' is a hindrance more than a help. 

[Casper 272]

I guess It's the same for every business and every job you get rewards if you put in the hard work suppose for a lot of us it's all we really know but I'm friends with a couple of people that spring to mind one has a haulage business and does ok due to his hard work in a difficult industry and also one who has a plant hire and property development  business again does well because he puts the work in 

yet I've seen others in both industries that fail like I have people in the motor trade over the years due to not putting the work in 

but whatever road you go down I wish you all the best 

Edited December 18, 2019 by Casper

[David Horgan 564]

1 hour ago, trade vet said:

Hi Mad Mark

The bottom line if you have no experience.If you haven’t got 20 grand don’t even bother and if you have ,be prepared to blow most of that in the first 18 months.As for Flipping Cars,he seems a good guy but he only made 3 grand last year so he may not be as good at this job as you think.The guys on here who do well,despite what they say put in huge effort and work very hard and regularly cope with set backs that cost a lot of money.This job is now very complex and you need rhino skin to compete,so good luck.

To Mad Mark 

******Heed the above from trade Vet with every word , this is the absolute truth of the motor industry . *****

save up is a good plan before you start .

Insurance and trade plates are essential 

A good idea of the workings of cars is essential too . 

It can be done as I've made my Son do it the hard way from one car to where he is now . BUT he is a mechanical Genius and was before it all  started . 

You will need to be , a sales man , customer care person , financial advisor , telephone personality , mechanic , valeter , book keeper , warranty genius , very patient at times , be able to work people out as some are horrible nasty bastards , some are normal and some are delightful  . It will take an enormous amount of your time up and you have to think of it in a very professional way , its not a job its a life style change 

There are a lot of additional items you need to keep your self within the regulations and the laws . 

If you are going to do this job DO IT CORRECTLY . Or not at all . 

[JA Trader 58]

50 minutes ago, 15Cars said:

Agreed, I had a good time in the summer. I think 69 plate sales have been crap hence the lack of nice straight part exchanges.

I'm in awe of some of the regular 'traders' at my local auction house buying the current crop of shit from the dealer part exchange events. How they make a profit is beyond me - I clearly have a lot to learn

I brought so many cars in late august for peanuts cant get anything at the moment

[Casper 272]

9 minutes ago, David Horgan said:

To Mad Mark 

******Heed the above from trade Vet with every word , this is the absolute truth of the motor industry . *****

save up is a good plan before you start .

Insurance and trade plates are essential 

A good idea of the workings of cars is essential too . 

It can be done as I've made my Son do it the hard way from one car to where he is now . BUT he is a mechanical Genius and was before it all  started . 

You will need to be , a sales man , customer care person , financial advisor , telephone personality , mechanic , valeter , book keeper , warranty genius , very patient at times , be able to work people out as some are horrible nasty bastards , some are normal and some are delightful  . It will take an enormous amount of your time up and you have to think of it in a very professional way , its not a job its a life style change 

There are a lot of additional items you need to keep your self within the regulations and the laws . 

If you are going to do this job DO IT CORRECTLY . Or not at all . 

Sound advice and may I add to it don't give up its hard at the start with you will always get the jack the lads telling you there making a fortune

you will at some point buy a wrong it happens to everyone it's how you resolve it that matters 

good luck 

[D&M 66]

5 hours ago, Mark101 said:

Wrong! It will be the driver AND the vehicle owner for allowing that person to drive without insurance.

Yes your right! But it'd be the Driver at the wheel who will get the 6 Points and the fine. I'm sure the owner will just get a fine. Unless the owner tells the police he didnt give permission and the driver would get done for TWOC (although it'd be funny to try and tell that to a copper with a straight face when you're sat in the passenger seat )