Private Hire Insurance
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What is private hire insurance?
If you love to be behind the wheel, driving a taxi can be a great way to make a living. Cities like London are well known for their black cab drivers. But across other major cities like Birmingham, Edinburgh and Manchester, private hire apps like Uber are on the rise.
If you own your own vehicle, working as a private hire taxi driver can be a good alternative to driving a black cab. While your own car will already be insured, to carry private hire taxi passengers, you will need specialist taxi insurance.
Why do I need it?
Driving any car on the roads is not without risk. Carrying fare-paying passengers brings different risks. Whether your private hire vehicle is a minibus, saloon, limo or luxury airport taxi, you’ll need to be sure you are covered in case a claim is brought against you.
Driving for business use will usually mean you cover a greater mileage per year than for personal use. Your insurance policy will need to cover this. The greater your mileage, the more likely you are statistically to be involved in an accident.
Transporting members of the public also mean you need to have a specialist cover in place. If someone is hurt or injured while in your taxi, they could make a claim against you, leaving you out of pocket. Having the right type of cover means you are protected.
What insurance cover do I need?
Private hire taxis come in all shapes and sizes. Regardless of what vehicle you drive, it’s vital you have the right insurance cover in place. There are three main types of cover for private hire taxis:
Policy only – this is usually the cheapest type of cover.
Named driver cover – as the name suggests, this policy covers one named driver only.
Any driver cover – with this type of cover, any legal motorist will be insured to drive the vehicle.
Similar to private car insurance policies, you can choose varying levels of cover for your taxi.
- Third-party insurance will cover the cost of any damage to third parties if you are involved in an accident. Your own taxi repairs would not be covered.
- Third-party fire and theft cover gives you additional protection in case your taxi is damaged by fire or stolen. As well as covering third-party costs, the cost of replacing your own taxi is also covered. This means you can quickly get back to work if the worst happens.
- Comprehensive. This type of policy covers all the above, along with covering your own costs in the event of an accident.
Public liability insurance – Some taxi insurance policies may include this as standard but check with your provider. If your passenger is hurt or injured whilst in your taxi, they could bring a claim against you, which could leave you seriously out of pocket.
How to save money on private hire taxi insurance?
Taxi insurance is often much more expensive than car insurance for personal use. This is because of the higher risk of a claim. Driving in high traffic locations, increased mileage and the type of vehicles used as private hire cars can all mean higher insurance premiums.
Choose your car wisely
The larger and more powerful the car, the higher the cost of insurance. As many private hire vehicles need to accommodate multiple passengers, this can mean bigger insurance costs. Choosing a car in the lower car insurance groups as your private hire vehicle can be a way of keeping premium costs down.
Penalty points on your driving licence significantly increase the cost of your insurance. By keeping a clean driving record, you can ensure that you are not classed as high risk by insurers. Driving safely will reduce the likelihood of being involved in accidents. You can build up a no claims bonus, which will bring down the overall premium cost for your taxi.
Keep your taxi secure
Making sure your vehicle is secure will reduce the risk of theft. Make sure that all alarms or immobilisers are in good working order. When you’re not driving, aim to store your taxi in a secure location like a locked yard or garage. The greater the security, the lower the risk and cheaper your insurance policy will be.
Can I use my taxi for personal use too?
If you use your minicab for personal as well as business use, you will need to ensure you have separate cover in place for personal use.
How many passengers can I carry in my taxi?
The number of passengers legally covered for your taxi or minicab will depend entirely on the type of vehicle. You must be aware of the limits for your own vehicle. If you carry more passengers than this limit, your insurance will not be valid.
Is public liability insurance a legal requirement?
You are not obligated to have public liability insurance if you drive a private hire taxi. It is highly recommended to take out cover though. If a passenger is injured or even killed in an accident, you could find yourself with huge claims against you.
Do I need private hire breakdown cover?
As your taxi may be your main source of income, any time off the road can have an impact on your earnings. Some insurers include breakdown cover as standard on private hire policies, so check with your insurer. It may increase the cost of your premium, but in the long run could get you back on the road more quickly after an accident, preventing loss of earnings.
What is the difference between a private hire and public hire insurance?
If your taxi can be hailed on the street by any member of the public, you will need public taxi insurance. Private hire cabs can only be booked in advance, and are not allowed to pick up by the roadside.