With so much business uncertainty currently, it may be necessary to change or update your motor trade insurance policy mid-term. It could simply be a change of address notification, adding a young driver to an existing policy or getting a new piece of kit insured on your contents policy.
Don’t panic, it’s not as complicated as you think as most insurance companies are only too willing to talk you through the process. However, if your situation has changed and you have failed to inform the insurance broker, you could find any future claim might be cancelled. You should bear in mind that there are some changes that need to be kept updated with your insurer if you are to stay legal and covered.
What is MTA?
In insurance jargon, mid-term adjustment (MTA), also called mid-term change or mid-term modification, denotes a change to an insurance policy prior to the end of the contract period. The policy change might result in a revision of the premium: an increase is usually called AP (additional premium) and a decrease is shown as an RP (returned premium). Effectively this is any change made to your insurance policy once it has already begun.
Insurers also need to notify any changes to the Motor Insurance Database so that if the police check you are insured you will not be stopped because the database details are incorrect.
Changing Your Policy
Here are some of the main changes you need to update your broker about, which may impact your motor trade insurance cover.
- Change of Address: If you move to a new house or motor trade business premises, then you should contact your insurer to let them know. Some locations (such as inner cities or country locations) affect your policy coverage, so it’s good idea to check if your insurance company is still able to offer insurance for that region before you make the move. The same goes for additional locations for any business purposes, including stock storage or if your vehicle parking changes because of the move.
- Vehicle type: You may have sold a vehicle and bought a new, more powerful one, so your policy cost might go up. If you have added extra racking or ladders or a lot of expensive equipment and tools, your insurer may need to increase your cover amount. Conversely, if you have added new locks or increased security equipment, you could see a reduction in your premium, so it is worth letting your broker know. The same would go for a fleet of vehicles, especially if you start to invest in different vehicles than on your original policy.
- Drivers: If you intend to add other drivers to your policy, including your spouse, business partner or new employees, you can do this under mid-term. Remember though, your additional driver’s circumstances might affect whether coverage will be granted. Any criminal or driving convictions and penalty points should always be declared. Age might also play a factor in whether they can be covered (adding a named driver under the age of 21), and what exactly they can be covered for, which is especially pertinent when adding new drivers to the policy.
- Level of Cover: If you decide you want to increase or decrease the level of cover on the policy mid-term because of changes to your business, then you can do so. For example, if you have a second job outside of the motor trade, then you might want to add additional part-time business use to your motor trade insurance policy.
- Company status: Changing your business from that of sole trader to a limited company will need to be updated on your policy mid-term, not left until your policy expires or is renewed. This would also be true if you were to change the name of your company
- Public and Employer’s liability: As your business expands, you may find you need the addition of public liability insurance, especially if it involves more contact with the general public. If taking on employees, you will legally need to take out employer’s liability insurance and all of this can be done mid-term.
If you are in any doubt about the MTA, give us a call at Tradex and we’ll talk you through all of the options available to you.