What kind of insurance is necessary for your taxi?
Here is all the information you need to know about taxi insurance, regardless of whether you are a novice cab driver seeking coverage or you have years of expertise and are looking for the best policy.
What is insurance for taxis?
A specialized auto insurance plan called “taxi insurance” is made to protect vehicles used for commercial hire. A standard auto insurance policy won’t be sufficient to protect you if you work as a cab driver. However, taxi insurance will safeguard not only your passengers but also you and your car. Whether you operate a black cab, a private hire car, or Uber, it is mandatory.
Do you need insurance for cabs?
If you make a living as a cab driver, it is legal. If you work as a driver, you are legally required to have a valid taxi insurance policy. Depending on the type of cab you operate and the location you drive it, you will need a particular level of taxi insurance coverage, as explained below.
PCO coverage
Black taxis and microcabs in London are licensed by the Public Carriage Office, a subsidiary of Transport for London (TfL). PCO insurance is consequently required for cabs with PCO licenses.
Insurance for public-use taxis
Public hire taxi insurance protects drivers of cabs that customers can either hail on the street or order at a taxi stand. These cabs are equipped with a taxi sign. Your ability to pick up random customers is only covered by public hire taxi insurance. If you pick up clients on demand, the only insurance that will protect you is public hire taxi insurance.
Private hire taxi insurance & Chauffeur-driven cab insurance (private hire and reward)
Private hire taxi insurance provides coverage for taxis that need to be reserved in advance, including the majority of minicabs and big multipurpose vehicles (MPV) taxis like people movers. The insurance, which is also known as private hire and reward insurance and chauffeur insurance, does not cover picking up clients who have not made reservations from locations like train stations or taxi ranks.
Do Uber drivers require coverage?
The best form of coverage for drivers who work for Uber and its rivals is private hire insurance. Although Uber prefers not to identify itself as a private hire business, insurers will view Uber drivers as running a taxi service and will require them to. Even though Uber does not want to refer to itself as a private hire business, insurers will view Uber drivers as running a taxi business and will demand that they carry the necessary insurance.
According to Transport for London, as long as the booking originates from the region in which they are licenced, Uber drivers from anywhere in the UK can currently pick up and drop off in London.
TfL issued a warning, noting that it is pleading with the federal government to exercise more control in this situation. We are presently addressing our concerns with the government to make sure we have the necessary safeguards, the statement read. “We do not have the authority to prevent this type of cross-border operation.”
Can I increase the number of paying passengers covered by my standard auto insurance policy?
You will require a commercial private hire coverage in place of your regular car or van insurance if you are transporting a paying customer. Additionally, Uber drivers must make sure they have public liability insurance, whether it be provided by Uber, their auto insurance, or a separate policy (more on this below).
Temporary taxi insurance
Part-time taxi drivers may find that short-term taxi insurance is a wise decision because it provides flexible coverage and may be less expensive than purchasing a yearly policy. Short-term insurance normally provides coverage starting at one week and going higher from there.
Who is eligible for taxi insurance?
Many taxi insurance companies won’t provide coverage unless you:
- have a driver’s license that has been active for at least a year.
- have reached a certain age, typically 21, although some only permit those who are at least 25.
- an active taxi driver’s license
What to watch for when applying
You must confirm your operating area when you apply for taxi insurance. To avoid wasting an application, thoroughly review the eligibility requirements first. You might not be covered to work outside of this. The type of coverage you can obtain might be constrained by the location of your workplace. Check your policy carefully because some policies only provide fully comprehensive coverage if you are registered in specific places.
Which cover is required?
The same three tiers are available for taxi insurance. The three types of protection available with taxi insurance are fully comprehensive, third party, fire and theft, and third party only policy. In our guide, you can determine which level is best for you.
However, you need also take into account other coverage choices that are unique to taxi insurance, such as:
Public liability insurance:
Public liability insurance safeguards you in the event that a passenger is hurt or property is damaged while in, entering, or exiting your taxi. Any resulting legal or compensation claims will be covered by it. Most taxi insurance policies will automatically include this coverage, but carefully read the policy because not all do.
Persona use cover:
If you intend to utilize your cab, you must have personal use insurance. If you want to use your taxi regularly while you are not working, you must have personal use coverage in place. Check with your local authority to see if unregistered drivers are permitted to operate licenced taxis if you also want your partner to use the vehicle, as not all do.
Unlimited mileage:
Unlimited mileage: As a taxi driver, you’ll travel a lot of miles annually; having coverage that doesn’t charge you extra if you go over your allotted mileage will keep you from facing financial penalties. To determine whether this coverage is worthwhile, consider how many miles you typically travel each year.
Breakdown coverage: Should your taxi break down while transporting customers or in between drop-offs and pick-ups, this will give roadside assistance.
Legal protection:
Legal protection: pays for the costs of defending you in the event that someone makes a claim against you or vice versa after an accident.
Additionally, you typically have a choice of:
- The cheapest and most basic type of insurance is “coverage only,” however adding additional drivers will raise the cost.
- Provides protection just for the taxi driver under the name driver cover.
- Any driver protection: offers insurance to anyone operating your cab, provided they are at least a particular age (typically 25). The most expensive choice is this one.
What is the price of taxi insurance?
Taxi insurance typically costs more than ordinary insurance because:
- You’ll log more miles annually.
- The number of passengers you transport will increase the danger of injuries to individuals.
- You’ll log more miles annually.
- By carrying additional people, you run the possibility of lawsuits for personal injuries.
- Due to its size compared to standard vehicles, taxi taxis will fall under a higher insurance classification.
- Taxis frequently operate at odd hours and travel through congested areas.
The same variables that affect the cost of regular auto insurance also affect taxi insurance, including the vehicle you drive, your residence, where you keep your cab, and your driving history.
This article includes a comprehensive guide of all the elements that may have an impact on how much your insurance will cost.
How to lower the cost of your insurance
Comparison shopping and price comparison are the best ways to discover affordable coverage.
Comparison browsing and market price evaluation are the best possible ways to discover affordable coverage. Although you can discover specialized businesses that do, the majority of standard auto insurance do not cover cabs.
By maintaining a good claim-free record, selecting a responsible vehicle, and adding security systems like CCTV to your taxi cab, you can also lower your taxi insurance premiums. More information on how to reduce the cost of your taxi insurance may be found in our guide.
