Similar to taxis, private hire vehicles transport passengers. What separates them from other taxi services is that private hire vehicles must be pre-booked, so drivers shouldn't pick up passengers at taxi ranks if there wasn't a prior arrangement.
Another term for minicab, a private hire vehicle (PHV) could be used to provide a service to passengers through an on-demand ride-hailing app. This means modern taxi-like services including Ola, Gett, Bolt, or the most recognisable brand, Uber, all use drivers operating private hire vehicles. Similarly, you could work for a more traditional minicab company that takes bookings centrally through its website or office.
However you operate, if you're using your vehicle to provide a service then you need a specific type of business car insurance.
If you're new to minicab driving, you might be surprised at the relatively high cost of insurance compared with car insurance for domestic use.
Private hire taxi insurance is more expensive than standard car insurance because there is an increase in the perceived risks associated with this service. These include driving:
In addition to this, driving for private hire may involve transporting passengers who are loud and possibly distracting. Driving for Uber or other taxi-hailing apps may also be a second job, meaning drivers could be tired.
Together, all of these factors push the price of insurance up because insurance providers expect the likelihood of a private hire driver to be involved in a road accident to increase. As a consequence, in the eyes of the insurer, minicab drivers are more likely to make a claim.
To get the best value for money on your private hire insurance, compare taxi insurance quotes using Utility Saving Expert's free online comparison tool.
By reviewing your options and comparing policies from a wide range of insurance providers, you can browse the most competitive rates and choose the cover that makes your money go furthest.
The type of car you drive, the area where you live and the area you plan to cover for work will all impact the range of quotes you receive from insurers. Information about you and your driving history also influence what sort of deals you'll be offered. Some of these factors can't easily be changed. However, there are a number of things you can put in place to encourage better quotes from insurance providers.
In addition to shopping around for the best deals, you can aim to reduce premiums by:
If you are able to park your car in a safe area, preferably on a driveway instead of the side of a busy street, you can reduce your insurance premiums. This is because you reduce the chances of having your vehicle hit by a careless driver whilst it's parked or targeted by criminals, which tells insurers you'd be less likely to make a claim. Keeping your car safe whilst you're off-duty can lead to more affordable cover whilst you work.
Whilst monthly insurance payments might be practical, choosing to pay for an entire year's cover in one go will reduce the amount you pay in the long run. Insurance payments made annually rather than monthly almost always save money because this is more convenient for the insurance providers. As long as you can afford to pay one bulk payment per year, you'll benefit overall. Annual payments are also a good catalyst for ensuring you compare policies instead of rolling on year-on-year, prompting you to switch to a cheaper deal when renewal is coming up.
As with all car insurance, your provider will offer quotes in line with the associated costs of the vehicle you want to cover. The make, model and age of your minicab will all contribute to how much you pay. You'll find that a reliable car with cheaper parts will get you a better deal than a high-end motor with a large engine that is more costly to fix, should you claim on your insurance.
There are three levels of cover offered for private hire taxi insurance:
You may be familiar with these terms because they are the same whether you're purchasing a domestic car insurance policy or a specific type of business cover like minicab insurance.
Most people expect to pay the least for a third-party policy because it offers the least protection and covers just the legal minimum. Similarly, there's an expectation that fully comprehensive policies are the most expensive because they offer the most complete coverage. However, this is not always the case.
Often, for both domestic and business cover, you'll find comprehensive covers are reasonably priced and offer the best value for money, whereas third party cover does not always provide the cost savings to match the reduced value. It's best to compare your options to ensure you find the right cover for your needs.
Despite the high prices of some private hire policies, they won't always include insurance for personal use as standard. It's important to check you have read and understood the terms and conditions otherwise you might find your insurance only covers you whilst you're working and not when you're driving whilst off duty. If it isn't already included, most policies will offer personal cover as an optional extra.
It's not a legal requirement for minicab drivers to take out public liability insurance. Generally, it's not a requirement from taxi firms or ride-hailing apps either. However, for many private hire drivers, taking out public liability insurance provides extra peace of mind by covering worst-case scenarios such as legal costs, accidental injuries to passengers, or damage to their belongings.
Although you could be legally driving a vehicle from the age of 17, many local authorities and insurance policies enforce minimum age restrictions of 21 or sometimes 25 for cab driving. Those under these age limits may not be able to get minicab licenses or insurance cover, so it's a good idea to wait until you are over 25 and with more years of experience behind the wheel before you start minicab driving, or look into specialist insurers.