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Taxi Insurance Tips
Quotiva can help you find cover for both public hire and private hire taxis. If you're starting out you may still be undecided as to what type of taxi you want to drive:
- Typically private hire vehicles are booked for appointment via a taxi office -- drivers are contacted on two-way radio and then make their way to wherever their passengers need picking up. Private hire cars are often called minicabs too.
- Public hire taxis can be hailed by the public on the street at any time. These are known as black cabs (confusingly even when they're not painted black!) and hackney cabs/carriages. These vehicles can often seen be seen queueing at taxi ranks in most town centres.
Both taxis offer different kinds of service to the public, a lot of private hire vehicles may focus on certain kind of journeys -- be that acting as an airport shuttle between London and Heathrow, Gatwick, Stanstead etc or perhaps as a school run service. Black cabs are typically used around town centres and the suburbs, for when public transport doesn't cut it or when people need to get somewhere in a hurry.
One thing to remember -- if you are thinking of driving a black cab in London / within the PCO plating authority you will need to take The Knowledge, which means you must be able to find the quickest and most appropriate route from A to B in London, using nothing but your brain ...not for the faint hearted!
What should you look out for when searching for taxi insurance?
You've probably already noticed that taxi insurance is complex stuff -- that doesn't mean it has to be complicated though. It's best to look at essentials first.
If you're driving a vehicle on a public highway in the UK, at the very least -- and as a legal requirement -- you will need third party motor insurance. Of course, standard car insurance policies won't cover you for carrying passengers on a hire and reward basis. Also, as your taxi will effectively become your "office", many drivers opt for comprehensive cover as their vehicle is essential to business. These are the kind of things brokers will be looking for:
Where are you based?
Your location -- indicated by your plating authority or by the postcode of your taxi office -- can make a very big difference to how much your taxi premium will cost you. Private and public hire drivers in large cities such a London, Birmingham, Manchester, Bradford and Glasgow will face more risks than drivers in rural areas. These risks are not just found on the busy urban roads (more traffic means that there is more chance of an accident), but can also be due to thriving nightlife and drunken misbehavior, sadly both taxi drivers and their vehicles are often subjected to thoughtless abuse. Crime rates are often higher in inner city areas and taxis are more vulnerable to theft and vandalism.
Who will be driving the taxi?
If you're reading this, it's likely that it will be you driving your taxi. The reason we ask is because if you are adding additional drivers that are much younger than yourself to your policy -- particularly if it's not 100% essential that they are able to drive your vehicle -- it's likely that you will be increasing your premium unnecessarily. With the taxi insurance market in its current state it is often very difficult to find reasonably priced cover for drivers under 25. However, whilst cover for drivers of this age may be more costly, it's not impossible to find.
Driving license and taxi badge
Generally insurance brokers will be looking for drivers who hold a full UK license. The amount of time they require a driver to have held this for will differ from broker to broker. Taxi badge is another matter -- most brokers will only start offering discounts on your taxi insurance after a driver has held their badge for a year or more. If you have held your taxi badge for less than this time, it is by no means impossible to find cover -- it may just cost more than it will after building up some experience.
No Claims Bonus
Like all motor insurance, if you have no claims bonus (NCB) on your private hire or public hire insurance it will lead to a discounted premium. Of course, drivers who are starting out in the taxi world have not had the opportunity to build up any taxi NCB. Thankfully, there are brokers out there that are able to mirror the NCB you may have built up on your standard private car insurance policy. Good driving records will not be ignored!
What type of vehicle do you drive?
Whether you're a black cab or minicab driver, there are many different kinds of vehicles you could use to ferry passengers about in for your taxi business. From saloons (be that an Audi, VW, Vauxhall, Renault etc) to minibuses, from MPVs to estate cars and of course the standard black cab (TX1, Tx4, FX, Mercedes Vito). The type of vehicle you drive will affect your cover for various reasons. Looking purely at the vehicle itself, cars with very large and powerful engines generally cost more to cover. However, the type of fuel the engine runs on -- standard petrol or diesel -- can have an affect on your insurance cover, as does the age of the vehicle.
The most important factor for your taxi cover though, when it comes to the type of vehicle you use, is the number of passengers you are licensed to carry. If you are using a private hire minibus, it's likely that you will be carrying out different journeys than drivers in public hire black cabs. Of course, how much your vehicle is worth will also affect your premium.
Whilst traditional car insurance premiums are influenced by mileage, taxi policies are a bit different. Whilst it may be possible to agree a limited mileage deal with a broker and cut down on costs, many taxi brokers actually offer unlimited mileage deals, meaning if business is good you won't need to watch the mileometer.
How is the vehicle stored overnight?
This is a common factor that has an impact on nearly all kinds of motor insurance. Keeping your taxi garaged or on a driveway can cut the cost of your premium. Vehicles left on a public road will be exposed to more risks.
As with all insurance policies there are so many factors that could affect your premium it's hard to list them all. One to remember is voluntary excess -- if you have the money to pay towards claims and expenses, insurers are often willing to lower the cost of your premium for you. There are also many add ons that taxi brokers may ask you about. For example, they may offer you taxi breakdown cover -- this would mean that should your cab let you down, they will help to get you back on the road quickly. In fact some brokers, may offer a replacement taxi to ensure you can keep your business rolling if your own vehicle is off the road.
As the UK becomes more and more litigious anyone who works with the public may want to consider public liability cover. If you were to have an accident in your cab that caused injury or damage to a third party or their property, they may make a claim against you. PL cover will provide you with protection should an unhappy customer wish to make a claim.