Compared to standard car cover, private hire insurance is usually more expensive. Taxi drivers will need this type of cover if they are transporting passengers. This will apply to those driving for ride-hailing companies such as Uber, or operating minicabs. If you are driving a private hire vehicle, you will not be able to pick up passengers from the street and your journeys must be booked in advance. Here’s our guide to insurance for private hire vehicles.
Why do I need private hire taxi insurance?
If you drive a taxi for a living in the UK, it is a legal requirement to have insurance. The purpose of cover is to protect you, your vehicle and your customers when you’re using a vehicle for commercial hire. To purchase a policy, you will also need a full taxi license.
How is private hire cover different from public hire?
As mentioned above, a private hire insurance policy means your taxi cannot be hailed in the street. All journeys must be pre-booked. Public hire has the addition of allowing your taxi to be stopped in the street by a passenger. These types of taxis are usually owned by a company and will have a sign displayed at the top of the vehicle.
Before you do compare private hire insurance and buy a policy, make sure you have the correct license.
Levels of taxi insurance cover
Third party only
This covers you for injury or damage you cause to other people. It is the minimum level of cover required to drive in the UK and provides compensation for other people that you have caused injury or damage to. Note that this level of cover does not provide any compensation for injury or repairs to you or your taxi.
Third party, fire and theft
This offers what a third party only policy does, in addition to cover if your vehicle is damaged by fire or has been stolen. It will not cover the costs of damage to your taxi in an accident.
This offers the highest level of protection, and is usually the most expensive. It includes everything in a third party, fire and theft policy, in addition to cover for you and your vehicle in the event of an accident. Some policies also include medical expenses and legal cover. However, do not assume every policy is the same, always read the terms and conditions so you know what is included and excluded.
What should private hire insurance cover?
Generally, private hire insurance should include public liability cover. This provides cover for a passenger who is injured or their property has been damaged while in your taxi. Legal and compensation claims that are pursued by passengers will be covered under this policy type.
Taxi drivers that take out private hire insurance normally drive a lot more miles, have regular contact with passengers and work during unsociable hours. For this reason, all of these will be accounted for in this specialist type of cover.
How can I get cheap private hire insurance?
There are a number of ways you can reduce your annual premium. First of all, choose a vehicle that falls into a low insurance group. As you will be travelling tens of thousands of miles each year, fuel consumption will also be a highly important factor when choosing your next car.
Building up a no claims discount can also help you get cheaper cover. Insurers want low risk drivers so being safe and responsible behind the wheel will ensure you pay less. This will also help you avoid receiving any penalty points and driving convictions, as these will increase the price you pay for private hire cover significantly.
Security is another area for you to consider. Your car should have an alarm, and you should also think about installing an immobiliser. A dash cam can also help record any incidents. You should park your vehicle in a safe location when it’s not in use.
Using an online comparison site to compare cheap private hire insurance is one of the smartest ways to save money. It’s quick and easy to do and you’ll be presented with quotes from a number of different insurers that can be filtered by price and features.
Why is taxi insurance more expensive than standard car cover?
There are a number of different reasons why it costs more to insure a taxi when compared to a standard car insurance policy. Firstly, you will be covering a lot more miles each year in comparison to someone who just travels to and from work. A lot more hours will be spent on the road, which increases your chance of being involved in an accident, even if you are an experienced driver.
Furthermore, you are also carrying passengers, increasing the chances of personal injury claims being made against you. Taxis also normally tend to fall into higher insurance groups as they will likely be larger vehicles to accommodate passengers. This also has an impact on your yearly premium.