FCA authorised · FRN 724952 0117 325 0027Quote & buy →
Motor trade insurance
Garage insurance is a motor trade policy for independent repairers that combines premises, tools, liability, customers' vehicles and road risks for road tests. It matters because one workshop holds several risks at once: staff under raised vehicles, other people's cars and repairs that customers rely on.
Part of: Motor trade insurance
In short
An independent garage usually needs cover in five areas: the premises, tools and equipment; customers' vehicles in its care; public and products liability for injury or damage caused by its work; employers' liability of at least £5 million if it employs anyone; and road risks for road tests, collections and deliveries. Faulty workmanship is the area most often misunderstood, because products liability commonly pays for the damage a bad repair causes but not the cost of redoing the repair. Cover is subject to the insurer's acceptance and the policy terms.
Most independent garages buy a combined motor trade policy built from sections. A typical structure looks like this:
| Exposure | Section that commonly responds | Typical questions from insurers |
|---|---|---|
| Fire, theft or damage to the unit, tools, lifts and diagnostic equipment | Material damage | Construction, alarm, sums insured, hot work |
| Customers' cars damaged or stolen on site | Customers' vehicles | Highest value and total held, key storage |
| A visitor injured in the workshop | Public liability | Whether customers can enter work areas |
| A repair causes an accident or damage later | Products liability | Type of work, brakes, steering, tyres |
| An employee injured or made ill at work | Employers' liability | Number of staff, wageroll, training |
| Road tests, collections and deliveries | Road risks | Drivers, ages, points, level of cover |
| Lost profit after a fire closes the workshop | Business interruption | Gross profit, indemnity period |
Section names and scope vary between insurers, so the schedule and wording decide what you have.
Business interruption deserves a second look in a garage. A fire that damages the workshop may also destroy lifts, diagnostic equipment and parts stock that take months to replace, and customers may move to another garage in the meantime. Insurers usually ask for your gross profit and how long you want the indemnity period to run, which should reflect a realistic time to rebuild and win the work back. See business interruption insurance.
Lifts, jacks, compressors and diagnostic kit are high-value and essential. Insurers commonly ask how lifting equipment is examined, because a lift failure can injure staff and damage cars at the same time.
The HSE's guidance on working under vehicles says vehicle lifts should be thoroughly examined by a competent person, recommending every six months, and that other lifting equipment such as trolley jacks and engine hoists should be examined every 12 months. It also says vehicles falling or rolling off incorrectly positioned jacks or stands are one of the main causes of fatal accidents in motor vehicle repair. The general HSE guidance on thorough examinations sets six months for lifting accessories and 12 months for most other lifting equipment, unless an examination scheme says otherwise.
Tools are a common gap. Technicians often bring their own tool chests, and those may not be covered automatically under the business contents, so tell the insurer if staff keep their own tools on site. Keep the examination reports too. They help at renewal and after an incident. Engineering inspection cover can sometimes be added to arrange the examinations.
Fire is the other premises risk. The responsible person for a workplace must carry out a fire risk assessment under article 9 of the Regulatory Reform (Fire Safety) Order 2005. Insurers commonly ask about welding and cutting, fuel handling, battery charging and waste storage.
Every service you supply to a private customer must be performed with reasonable care and skill under section 49 of the Consumer Rights Act 2015. If it is not, section 54 gives the consumer the right to require repeat performance or a price reduction, alongside other remedies such as damages.
Insurance treats this in two parts:
Illustrative: a garage replaces brake pads and leaves a caliper bolt loose. A week later the customer has a low-speed collision. A claim for the customer's injury and the damage to the third party car would normally be looked at under products liability. The cost of redoing the brake job would usually fall on the garage.
If you employ anyone, including apprentices, you need employers' liability insurance of at least £5 million under the Employers' Liability (Compulsory Insurance) Regulations 1998. GOV.UK states the fine is £2,500 for every day you are not properly insured. See employers' liability insurance.
Workshop exposures go beyond falling vehicles. The HSE's COSHH guidance for motor vehicle repair lists substances including fuels, brake fluids and lubricants including waste oil, welding and cutting fumes, dusts from abrasive wheels, degreasers, adhesives and fillers, and battery acid. Insurers commonly ask about training, protective equipment and how these are controlled, because injury and disease claims can arise years after exposure.
Customers' cars on site need their own limit, set for the most valuable car and the total you might hold. Key storage conditions are common. For more detail see customer vehicles in your care.
Road tests, collections and deliveries need road risks cover that meets section 143 of the Road Traffic Act 1988. Every technician who drives must fit the driver terms, and the level of cover should include damage to the customer's car if that is what you want. The road risks gap scenario shows how this goes wrong.
If a customer never collects a car, section 12 of the Torts (Interference with Goods) Act 1977 gives a bailee a power of sale in set circumstances after the required notice. Take legal advice before using it.
Many garages also sell cars, test MOTs, fit tyres or work on electric vehicles. Each activity changes the questions an insurer asks and may need its own section or declaration. Relevant pages:
Leaving an activity off the proposal can matter at claim stage. Under section 3 of the Insurance Act 2015 a business must make a fair presentation of the risk, which includes what it actually does.
Apex arranges motor trade insurance for garages and mechanics, including combined cover for premises, stock, liability and road risks. A broker reads your enquiry and comes back with options, with no fee for a quote. We need what the business does, the premises address, who drives (ages, licences, points), turnover, the values of your own stock and customers' vehicles, and claims history. Cover is subject to the insurer's acceptance and the policy terms.
Two covers are legal requirements. Any vehicle used on a road, including road tests, must be insured under the Road Traffic Act 1988, and a garage with employees must hold employers' liability insurance of at least £5 million. Premises, public and products liability and customers' vehicles cover are not compulsory by law but are commonly needed.
Usually in part. Products liability is designed to cover injury or damage caused by faulty work, subject to the wording. The cost of redoing the repair or refunding the customer is commonly excluded as faulty workmanship, although some insurers offer a limited extension. Check the exclusions before you rely on it.
They can be if the policy includes road risks for customers' vehicles and the driver fits the policy's driver terms. Check whether cover is third party only or includes damage to the customer's car, and make sure every employee who road tests vehicles has been declared where the policy requires it.
HSE guidance on working under vehicles recommends a thorough examination of vehicle lifts by a competent person every six months, and every 12 months for other lifting equipment such as trolley jacks and engine hoists. Insurers commonly ask whether examinations are up to date, and keeping the reports helps at renewal and after an incident.
The Torts (Interference with Goods) Act 1977 gives a bailee a power to sell uncollected goods in set circumstances, after notice of intention to sell or reasonable steps to trace the owner. You must be reasonably satisfied the customer owns the car and account to them for the proceeds. Take legal advice before selling.
Not always. Business contents cover is designed for the business's own property, and tools owned by employees may need to be declared separately or covered by an extension with its own limit. Tell the insurer how many technicians keep their own tools on site and roughly what they are worth, and check how theft from a locked workshop is treated.
Tell us what your business does, who drives, your premises and vehicle values. A broker reads every enquiry and comes back with options. No fee for a quote. Or call 0117 325 0027.
Start a motor trade enquiry Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information, not advice on your individual circumstances, and it does not guarantee that cover will be available or on what terms.
