Driving a taxi can be a great way to earn money, but it comes with its own risks. Not only do you need to protect your passengers, you also need to keep yourself and your business covered. That's where taxi insurance comes in.
Taxi insurance is a type of policy that covers drivers who carry fee-paying passengers (it’s also known as hire and reward). It protects you, your vehicle and your business against any damages or injury claims made by passengers or members of the public.
Taxi insurance is a broad term that can be applied to insurance for private hire vehicles, black cabs and Uber drivers. In this article, we look at the different types of taxi insurance, including public hire and private hire insurance, how you're covered to carry passengers, and things that can affect the cost of your insurance.
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What is private hire taxi insurance?
Private hire insurance provides cover for licensed drivers who carry pre-booked passengers in return for payment. Private hire insurance is sometimes called taxi insurance, minibus insurance or PCO insurance — it’s specifically for people who drive passengers for a living. Your standard motor insurance (known as social, domestic and pleasure) does not cover this type of business activity.
What is public hire taxi insurance?
Public hire insurance is essential for all vehicles licensed as a Hackney Carriage. It’s also known as black cab insurance. Public hire insurance offers similar cover to private hire insurance, but the main difference is that it covers taxis that can be hailed down by customers on the street, or picked up at a taxi rank.
Do Uber drivers need taxi insurance?
Yes, you will need private hire taxi insurance to drive for Uber. Insurers see Uber drivers as operating a private hire taxi service, so you’ll need to have the right taxi insurance in place. If you’re involved in an accident while driving for Uber and you don’t have the right insurance, you will likely have your claim turned down.
What taxi insurance cover do I need?
Taxi insurance policies are usually available in 3 different levels of cover:
- Third party only
- Third party, fire and theft
- Fully comprehensive
Here are a few other things you should consider when getting a taxi insurance quote:
Public liability insurance
Public liability insurance for taxi drivers provides protection against claims that you, as a driver, could be found liable for. It protects you if a passenger suffers a personal injury or damage to their property while either in, entering or leaving your taxi. It will cover you against any legal or compensation claims.
Personal use cover
You need personal cover if you plan to use your taxi for day-to-day use. Check with your local authority to see if unregistered drivers can drive licensed taxis, as not all do.
Unlimited mileage
As a taxi driver, you'll drive a lot of miles, so an unlimited mileage policy will protect you from unexpected fees.
Breakdown cover
Taxis and private hire vehicles spend more time on the road than most, which increases their breakdown risk. Not all insurers offer taxi and private hire vehicle breakdown policies. As a taxi or private hire driver, your vehicle is your business. Finding the right cover can help you keep going if it breaks down.
Along with the options above, you can usually choose between:
- Named driver cover: Covers the taxi driver only.
- Any driver cover: Provides cover for anyone driving your taxi, providing they are licensed and able to do so.
How much does taxi insurance cost?
The cost of taxi insurance is affected by the same things as your standard motor insurance, like where you live, your driving history, and the type of vehicle you drive. But taxi insurance is typically more expensive than a regular car insurance policy. Here’s why:
- Taxi drivers tend to drive more miles each year than regular drivers.
- Carrying passengers will increase the likelihood of a personal injury claim.
- Taxi work can involve driving in busy areas at the busiest times of day.
All of these things increase your risk of being involved in an accident, which can drive up the cost.
How do I get cheap taxi insurance?
There are a number of ways to reduce the cost of your taxi insurance. It's always sensible to shop around and compare quotes, but you can also:
- Choose a moderately-priced vehicle with a smaller engine size.
- Install extra security features and CCTV in your taxi.
- Build up your no-claims bonus history.
- Choose an annual insurance policy and pay for it upfront.
- Choose a behaviour-based insurance policy, like Zego Sense (it uses data to measure how well you drive — when you drive safely, you pay less for your insurance renewal).
Get a quick quote now — it only takes a minute.
Do taxis need special insurance?
Private hire taxis need a specific type of insurance known as ‘hire and reward’ (or H&R for short). It protects drivers and their vehicles from damages following an accident, and usually includes public liability insurance to protect against personal injury or compensation claims if a passenger or member of the public gets hurt.
If you're driving a taxi in London, there are a couple of extra things you'll need to think about:
English Language Requirement
In 2016 Traffic For London (TFL) introduced an English Language Requirement (ELR) — an English language exam that all London taxi drivers must pass to get their licence.
PCO Licence
As a private hire driver In London, by law your vehicle must be covered by hire and reward insurance at the point of licensing.
PCO stands for ‘Public Carriage Office’, a governing body that is part of Transport for London (TFL) that oversees all taxis in the capital.
Can I charge people with my normal business insurance?
If you're driving a paying customer, most standard car or van insurance policies won't cover you. Instead, you'll need taxi insurance (known as hire and reward insurance).
Decommissioned taxi insurance
Decommissioned taxi insurance is a type of insurance coverage for taxi drivers who are no longer actively driving their vehicles as taxis. This type of insurance is often needed by drivers who have retired, sold their taxis, or stopped operating them for other reasons.
Decommissioned taxi insurance can help protect against any liability or damages, even if the vehicle is no longer being used as a taxi. It’s important to notify your insurance provider if you have decommissioned your taxi so that they can adjust your coverage accordingly.
Steps to buying Zego UK taxi insurance
Our flexible taxi insurance provides you with all the cover you need to work as a private hire taxi driver. You can buy a policy in just 5 simple steps:
- Have your car details and private hire licence ready.
- Get an online quote in under a minute.
- When you’re happy, accept the quote.
- Receive your policy documents online or through our app.
- That’s it. You’re ready to roll.
Choose from a 30-day or annual policy to suit how you work. And don’t forget about Zego Sense, the smart policy that rewards good drivers with lower prices!
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