Changing From Sole Trader To Limited Company

[Pauly]

So i am about to change my business into a ltd company and my insurance is due for renewal soon so while i was checking prices and comparing quotes i wondered if it made any difference to the price what the business type was so i clicked on limited company to see what happened and when changing to a ltd the price went up about 20-30% !! (im a high risk driver (points/claims) so this equates to quite a price hike

Not sure why as all other details remained the same but now the question is, i am still a sole trader and will be when my insurance renews but am planning to change to ltd mid term, do i need to tell them ? Will i still be insured ?

My accountant reckons i could also lose my no claims bonus as its personal and not in a company name but not sure how true this is

Anyone else had any experience of these things ?

@PukkaT6

 

[Colner]

Not sure about the Ltd company price hike but most insurance companies will transfer the bulk of your NCB when changing from personal to business and vice versa...

 

[Dellmassive]

Same with me, sort off.

I have personal FComp car insurance with full NCB Etc for me and missus SDP use.

But the van had to be insured as business use, (Ltd company, company owns van, van reg in company name, company pays all the costs, I'm the main named driver + 2nd driver) so needed a separate policy with new NCB and everything.... plus its named driver only and not allowed to drive anything else.

So I have to pay for 2 polices over the year, both have there Own NCB and discount rates Etc, all separate.

Been the same for the last 15yrs.

So if your starting a fresh then 20-30% price increase might explain the start of a new NCB?(for the Ltd business policy)

Fyi.... I'm with A-plan for both motor policies.... and PLI too. (I try to get a bulk discount)

 

[Salty Spuds]

I’m Ltd, I’m the registered keeper, the company owns the van. The insurance is in my name, the company pays. I transferred my NCB to the van. Im paying about £300/year, full protected no claims. 2 named drivers me & the missus. It’s with Quoteline direct, Aviva policy.
HTH

 

[Murdoch]

Could you not ring around to get a better idea of the costs?

 

[Pauly]

I could but was on a comparison site checking renewal prices and it was just one button to click to say sole trader or ltd so i clicked it, just seemed strange how much it went up considering i left my 8 years NCD on there

Has anyone changed to ltd mid term and had any issues ?
Just trying to figure it out as i have four policies in my name all with named drivers so any price increase would be x4 and if i lose any NCD it could work out expensive

 

[Murdoch]

Just remember that not all insurance companies are on comparison sites ......

How come you have 4 polices, are you a sole trader with 3 employees?

 

[Pauly]

3 work policies (me and employee) and a personal one (wife)

I did try aviva etc but they always come out expense, I seem to always have a couple of claims/convictions that don’t help

 

[Keeff]

I have just changed mine from a ltd back to personal as I am changing jobs . It’s the vat that you will need to be careful with as you can have the van in your name and insure it for company use or in the company name and insure in your name but tell them it belongs to the company and not you . If you want the vat back on it then it should be owned by the company . Mine was about £100 cheaper in my own name with business use . If tha insurance is in company name then you will be a named driver but if you have a accident in it it will still go against you with other personal insurances as I found out .
Hope this makes sense.

 

[Lord Mfwic]

I could but was on a comparison site checking renewal prices and it was just one button to click to say sole trader or ltd so i clicked it, just seemed strange how much it went up considering i left my 8 years NCD on there

Has anyone changed to ltd mid term and had any issues ?
Just trying to figure it out as i have four policies in my name all with named drivers so any price increase would be x4 and if i lose any NCD it could work out expensive

Go with a single fleet policy for all the company vans, all company employees can drive any company vehicle. If possible bring the wifes car into the company as well. You should save a fortune.
And my advice fwiw, don't go with the cheapest, go with a recognised brand/company. These cheap insurance companies can bite you hard when you try and make a claim. I use Direct Line and they're only a couple of quid more than the cheap brigade. Look on their website, they offer cheaper quotes for online enquiries.

 

[Pauly]

Have tried fleet before and most companies seemed to want min of 5 vehicles and the ones that would accept less quoted crazy prices

 

[Lord Mfwic]

Have tried fleet before and most companies seemed to want min of 5 vehicles and the ones that would accept less quoted crazy prices

I had that problem once so I bought a cheap old van just to make 5. Rarely used it but it brought down my insurance cost so significantly that it far out weighted the cost of the scrapper including the tax and MOT and it was handy to have a spare van if 1 ever broke down. To be fair I did have 2 high grouped cars which I brought into the company that were rather expensive to insure on their own.
It might be a route worth re-exploring as I'm assuming the reason for going Ltd is because you're getting busier, so you may need that extra van soon anyway.

 

[Pauly]

Food for thought, thanks

 

[Dannyb6467]

Paul.
Speak to Elicia at NFU Bridgnorth and explain what you are doing.
Going LTD from ST will not effect your insurance if the vehicle isn't associated to the business. If the use of the vehicle changes then yes it would.
If the vehicle is a commercial then it's best from a cost point of view to register it to the company and you be a named driver, you get to keep and use your NCB. My policy with NFU is much cheaper doing it this way.
I have all my insurance with Elicia as she knows this side of the industry inside out.
Don't forget to ask her about PLI and ELI too.