With billions of pounds spent on motor trade insurance each year, businesses have been advised to ensure they are fully aware of the terms and conditions of their policy before going ahead and buying cover.
The Association of British Insurers (ABI) advises people that in the event a vehicle is stolen or damaged beyond repair, a motor trade insurance company will only pay the amount that it currently costs to replace the automobile with a similar model.
Businesses are reminded they will not get the sum they originally paid for a vehicle when making a claim on motor trade insurance, due to the fact that the majority of cars lose value over time.
Maggie Craig, acting director general for the ABI, states: "In the current economic climate, it is even more important people are not underinsured or put off getting vital cover because they don't understand how insurance works."
Earlier this month, Defaqto urged motor trade insurance providers to ensure that their consumers consider factors other than price when it comes to taking out cover.
