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Whether you drive a black cab, an MPV, or anything in between, if you transport people commercially, you’ll need to have a taxi license – and taxi insurance to go with it. In 2021, cabs come in all shapes and sizes, and so do the insurance policies to go with them.
Simply put, if you drive a vehicle to carry passengers for a fare (either contracted or metered) then you’ll need a commercial taxi insurance policy. It’s a legal requirement in the UK and comes in two forms.
Keep reading to learn everything you need to know about taxi insurance, from what type of cover you’ll require to how premiums are calculated, and how you can keep them a bit cheaper.
There are two types of taxi insurance, and the one you need will depend on the way you interact with customers.
If you pick people up from the street without a prearranged booking, you’ll need public hire insurance. Simply put, it means any member of the public can hire your commercial service.
This type of insurance is required by those operating black cabs.
In contrast, private hire insurance is required when your pick-ups are prearranged; i.e you know the person and the place you’re picking them up has also been arranged in advance. This type of insurance is required by everything from airport pickup services, to pre-arranged minicabs for nights out.
If you pick people up and charge them for it – either with a meter or through a pre-arranged booking – you’ll need taxi insurance. Because of the number of miles involved and the hours you drive, it’ll tend to be more expensive than normal insurance – but there are ways of making your payments cheaper." - Curtis Moldrich - Automotive Journalist
Taxi insurance tends to be more expensive than standard insurance due to the more challenging requirements of the job. Taxi drivers will often find themselves covering more miles at busier hours and on less familiar roads: all of these things generate increased risk and therefore higher premiums.
As you’d expect, taxi insurance quotes are also calculated based on the driver, the car, and the type of policy you need.
Insurance is partly calculated on the type of car you’re trying to get insured on. Cars are sorted into a group between 1 and 50 for insurance purposes, and generally the lower the group, the lower the premiums
You can reduce your premiums by upping your voluntary excess and agreeing to pay more before the insurance company pays the rest. While it may seem like a great idea to hike your voluntary excess up, remember that you may have to pay it one day – so make it affordable
By comparing insurance policies here, you could save money and earn £35 cashback
Make sure your car uses a modern immobilizer or tracking device. Securing your car in a garage overnight may also help push your premiums down, as will installing CCTV and a dashcam within the vehicle
Paying for your car insurance year in one go could be a lot cheaper. You’ll avoid the added interest rates of paying monthly
Most insurance companies will increase your premiums if your car is modified – and others may refuse to insure it at all. Keep your car plain and stock for cheaper taxi insurance
Taxi insurance can be had with a variety of useful extras, but they’ll end up costing you more. Analyse your usage and be sure to only get what you really need
Just like conventional insurance, taxi insurance tends to get cheaper the older you are. However, some policies require drivers to be over the age of 21 or 25 – both key ages in the insurance world.
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When using the Compare service, you must take reasonable care to answer insurers questions fully and accurately and if you volunteer other information, you must take reasonable care to ensure that the information is not misleading. If any information that you have provided changes before you take out your insurance, during the life of the policy or at renewal you must inform the insurer or broker of the change. If you deliberately or carelessly misrepresent any information in relation to this insurance, then your policy may not pay all, or part, of a claim and could in certain circumstances be avoided altogether.
*Quidco ran a prize draw between 22.07.20 and 05.08.20 asking participants to test us by comparing two car insurance quotes: one from Compare and one from any other UK comparison site. Out of 2,392 participants, 82.25% received a lower premium from Compare with their cashback included.