Not automatically. Liability insurance excludes damage to property in your care, custody and control, and the customer's own policy is not intended for your business risk. The garage policy has a separate section for customers' motor vehicles. Check whether it covers both damage during work and theft and fire on the premises.

That depends on your conditions. Many policies require a member of staff to go along, or set requirements on age, holding a driving licence and recording the driver's details. An unaccompanied test drive that is not permitted can lead to recovery against your business after a loss. Put your arrangements on test drives in writing and keep a copy of the driving licence.

Yes. Trading brings a stock risk and, on top of that, liability as a seller: a concealed defect or an incorrect odometer reading leads to a claim by the buyer. Such a claim is about money and not about injury or damaged property, so the ordinary liability section offers no help. So always declare the trading activity when you apply.

Administrative fines and penalty payments cannot be insured, because they are a sanction and not compensation. Clean-up costs after soil pollution on your own premises fall outside liability insurance and belong on an environmental damage policy. Pollution at a third party's premises, for instance after a leak during work on site, is assessed differently.