Table of Contents

Introduction

Document Aim

This document aims to give ATB’s and Motorcycle Instructors a simple explanation of each type of insurance cover that is essential to the training industry. It is sponsored by Devitt Insurance Services, they are one of the UK’s leading providers of Motorcycle Training School Insurance. They have been arranging insurance within the motorcycle industry for over 40 years and look after the insurance for the majority of ATBs in the UK.

Ensuring You Have the Correct Cover

Insurance is something that should be taken extremely seriously, it is not a business budget item and must fully cover the ATB, its staff and customers. It cannot be emphasised enough, how important it is to have the right protect, comprehensive cover must be the most essential consideration for any business owner.

Understanding What Is Covered

Choosing the right cover takes time, a thorough understanding is required of each section of insurance cover. The ATB owner must fully understand and know what each category of insurance they have, what it will and won’t cover.

Need more information?

Legal comment

Inherent risks

Running a business, no matter how small, attaches with its inherent risks, and in particular relation to your motorcycle training business, those risks can become even more acute. The most obvious protection your business requires will relate to your students, other road users, employees and your business generally
In addition, there are many other risks which you might not recognise at first blush and in certain circumstances, those risks may not be perceived to be very likely in the grand scheme of things, for example, natural disasters. However in a litigious society, cutting corners when taking out the appropriate level of insurance should be avoided altogether, no matter how tempting.

Appropriate Cover

No business owner has a crystal ball to predict what might happen. Sadly, in my line of work, I have come across clients who have tried to do just that and have left themselves open to a range of legal, financial and ethical ramifications. It could simply be one accident, one disgruntled employee or even a broken contract that causes irreparable ruptures to your business if you do not have appropriate insurance cover.

Escalation

Even if you manage to win a case should a dispute escalate to the court arena, you are lumbered with the time and cost of entertaining the claim, including any backlash this type of publicity can have on your business and future reputation. You would therefore rightly be asking yourself at this point whether it is truly worth putting you, your business and its stakeholders through those uncertainties.

Protection Of Assets

From a legal point of view alone, working against the urge to reduce your insurance premiums will ensure you prioritise what your business needs to operate legally and properly. This should encompass protection of all your valuable assets, for example, your employees, and not just your business premises or bikes. It is vital that you undertake research to know what type of insurance cover you require and whether it protects your interests, including liability claims or potential lawsuits. You are likely to find that many contracts you enter into require you to have certain insurance cover in place already. So be prepared to shop around and listen out for recommendations made by other users within your field of work.

Potential Breach Of Contracts

Failure to undertake these steps could lead to you breaching contracts, attracting fines or other court penalties, all of which could cost considerably more than the price of an insurance policy. This can have a crippling effect on how credible your business can come across with the relevant authorities but also the public at large.

By having appropriate insurance cover, you are rubber stamping good practice and working within the confines of the law. This allows you to focus your full attention on what you do best.

The Approved Training Body (ATB)

Protection For Your Business

As a training school, you’ll have a range of bikes – anything from a scooter with a small engine to a powerful super-bike, to suit riders of all ages and abilities. It’s important that you get the correct cover to protect your business. You can tailor your cover on business needs, pick and choose the right protection to build a bespoke policy.

The policy must cover the motorcycle for third party damage, fire and theft. The cover will include trainees of all ages and ability while they are under guidance and tuition. Make sure that all vehicles are added to the policy and any changes should be made immediately, to ensure they are covered on the policy.

Trade Policy Additions

Freelance, subcontractors and self employed Instructors must be properly covered too, with adequate personal business cover if they ride their own machine. This kind of cover can be added to the trade policy for a small premium and ensures a blanket cover for all instructors. Professional Indemnity is strongly suggested for all motorcycle instructors – regardless of the cost.

In this day and age with the sue culture, it is imperative that the business is fully compliant and covered for all eventualities, if proper business cover is not in place the individual instructor and/or the ATB Owner is personally liable.

The table below gives a rough guide to certain scenarios:

Incident Insurance Required
Rider not injured
Bike damaged
N/A
Motorcycle covered on policy
Rider Injured - at fault Personal Accident Policy
Rider injured - non fault Other parties insurance
Rider injured - non fault Other party not covered
Compensation through Motor Insurance Bureau
Rider injured - blames instruction Professional Indemnity
Rider trips on step in office Public Liability
Employee has accident in office Employers Liability
Theft from premises Premises and Stock Cover
Fire in premises Premises and Stock Cover
Can’t trade - fire next door Business Interruption Cover

Public Liability Insurance (PL)

Protection Against Claims From Third Parties

Covers you against claims from Third Parties for property damage or injury, in basic terms falls, slips and trips (excluding employees).

However well prepared you think you are, accidents do happen and the simplest accident can be financially devastating. Public liability insurance pays out if a client or member of the public is injured, or their property is damaged because of your business activity.

Public liability insurance covers you for the cost of a claim made by a member of the public that has suffered injury or damage to property as a result of your business or a product it has supplied. It protects you against the cost of compensation to be paid out, as well as the legal expenses incurred by the claims process.

NB:

If working from a home address, the home insurance must have adequate business cover. The ATB Owner should declare that the home address is the place of business.

Employers Liability Insurance (EL)

Cover For Employees

Covers injury to your employees as a result of your negligence (this cover is Compulsory by Law if you have employees)

Employers liability insurance will help you pay compensation to employees who get injured or fall sick as a result of your business activity. Employees may get hurt completely by accident or as a result of their work being mentally or physically demanding. However, if any damage caused is directly as a result of the work they are doing for the company, the employee has the right to sue, claim or demand compensation. For this reason, it is important for companies to have EL as a way to protect their employees and business interests.

Employers Liability Insurance for Self-Employed Workers

It is a tricky subject when it comes to self-employed workers or freelancers. If you only work with people who are self-employed and have no other employees, then employee liability insurance is not a legal requirement for your business.

However, if self-employed people work at your premises, use any of your equipment and given instructions by the business, you are still responsible for their health whilst in the workplace. Therefore appropriate cover is required.

Professional Indemnity Insurance (PI)

Cover For The Business

As a professional business providing advice and services to clients, Professional Indemnity cover must be seen as essential in the business insurance package. It is important to be confident in the quality of work the business delivers but even with the best intentions, things can go wrong.

If a client was to sue because they were unhappy with the service your business provided, Professional Indemnity insurance provides cover for your business. Even if you have not made a mistake legal cover is necessary to fight a claim against you or your business.

You will need Professional Indemnity Insurance if you:

Vulnerability to Claims

The reality is that any small business providing a professional service that can be challenged is vulnerable to a claim of negligence when the advice or service fails to meet a client’s expectations. These kinds of claims can be costly in time and money and disruptive regardless of whether they are legitimate claims or not.

NB:

In general policies will exclude the use of mechanical vehicles and bodily injury. For ATBs to be properly covered they must have these exclusions removed from the policy

Personal Accident cover (Personal Injury)

An Addition To Existing Cover

Personal Accident cover is an additional premium that can be added to existing motorcycle insurance, it provides compensation and some financial security in the event of bodily injury as a result of an accident. The quality of the policy is the decision of the individual.

Personal Accident policies pay out in the event that any of the following occurs as a direct result of an accident (policy dependant):

NB:

There are different policy levels of Personal Accident cover, the more you pay the more coverage is given. Cheaper policies will only payout on death, whereas more expensive policies will pay out on minor injury.

Premises and stock cover (can include Business interruption cover)

Protection For Premises & Stock

Your business equipment and furnishings are vital to the daily running of the business. Contents and stock insurance cover helps make sure that you can continue trading if the things you keep on your business premises are lost, stolen or damaged.

It covers the cost of replacing them, getting you back on your feet to continue trading. Depending on the policy, replacing stock may be based on its cost price and not the retail value.

Protection in the event of an occurrence causing disruption to your business

It is designed to protect businesses from any financial loss due to any damage to the business premises such as fire, flood or storm damage. Whilst buildings insurance will only give cover in the event of physical damage to the property, business interruption insurance will cover any potential financial loss of income that the business would have received had conditions been normal.

Depending on the severity of damage to the premises, this could mean the difference between continuing business as normal, and closing the company. If your business is unable to trade because of an interruption, business interruption insurance should cover lost income for up to 12 months.

Passive Income and revenue share

Affiliate Schemes

There are many Affiliate Schemes with motorcycle insurance companies. It would be wise to have as many affiliate schemes as possible to encourage clients to take insurance with one of the Insurance Companies affiliated to the ATB.

This way a passive income stream will be added to the ATB portfolio.

Customers need insurance for their motorcycle, so why not point them to an affiliate scheme where the ATB earns commission for the recommendation.

What you can expect from an affiliate partner: