Taxi Insurance Buying Guide

The taxi service system in the UK can be confusing, but the taxi insurance system is even more complex. There are about as many Hire and Reward insurance schemes available as there are types of taxi services in the UK. However, following the steps in this  purchasing guide may make buying your policy at least a little easier to do.

Step one: Conduct budget and risk evaluations

Purchasing the right amount of cover is just as essential as buying the right type. It is very easy to become over and under insured simultaneously. So itís vital to know exactly what your requirements are and what they may be in the near future. You canít adequately protect yourself, your employees, your vehicles, and your passengers, if you have no idea of what risks need to be addressed.

Things to you should take into consideration are:

∑ The value of your vehicles, including the cost of operating, maintaining, and replacing them in case of theft, fire, or accidental damage
∑ Security issues, such as theft, vandalism, or someone committing an assault on you, your employee, or your passenger
∑ Possible cost of legal and medical fees if any claims are made against you or any of your employees for any reason- Can you comfortably meet the cost of the claim by using the money you have saved up?
∑ The penalties for operating without proper taxi insurance and licensing
∑ Are there any ways to reduce or eliminate any of the risks?
∑ Are any of the risks covered by other types of insurance you currently carry?

Step Two: Select the right type of policy

The type of vehicle you drive, where you ply your trade, and what type of service you offer makes a huge difference in which insurance scheme is best for you. To choose the right coverage, itís vital to determine which primary and subcategory best describes your specific type of Hire and Reward service. Each subcategory comes with its own unique set of risks, requirements, and regulations.
The two primary types of taxi insurance are Private Hire and Public Hire. Private Hire is for the taxi drivers who are only licensed for carrying passengers on a pre-arranged basis which are booked through licensed operators. Public Hire is for black cab and hackney/carriage drivers who are licensed to pick up passengers without any prior arrangements. The subcategories mostly belong to the Private Hire category. These insurance schemes usually belong to Private Hire:

∑ Minicab
∑ Chauffeur
∑ Limousine
∑ Corporate Executive

All the cover for both main categories will fall under third party, third party fire and theft, or comprehensive/full coverage policies. Both types may also include added on features such as breakdown, replacement vehicle, windscreen/glass, and legal fees. Moreover, both primary categories may include insurance schemes such as:

∑ Minibus
∑ Multiple Purpose Vehicles, Multiple Passenger Vehicles
∑ taxi fleet
∑ taxi base office
∑ multi-driver

In some areas, the local licensing authorities may require having Public Liability or Third Party Liability insurance. Even if not required, you may want to consider having both, Public Liability and loss of income coverage. It may be feasible to check into special types of taxi business related cover combined with various motor insurance cover.

Step three: Compare policies and prices

Recent surveys revealed that many UK citizens do not do any type of comparison shopping for insurance. This lack of shopping may cause the citizens to pay too high for their coverage. However, thereís no real excuse for not doing at least a little bit of comparison shopping, since it can now be done online or off-line. To do online comparison shopping, just:

1. Visit several insurance comparison websites, as well as the websites of insurance brokers and specialists. Accurately fill out their brief forms and submit them. It may be tempting to alter or omit some of the facts in order to get a better price. However, doing so can invalidate your cover later if you do attain insurance based on that information.
2. Wait for the insurers to contact you with their offers.
3. When the insurers contact you, ask them questions, such as what kind of discounts do they offer and what criteria are they basing your premiums on. Ask them to tell you exactly what is included and excluded in the offers they present to you. Donít be afraid to ask the insurer to modify the policy to include and exclude the services you may or may not need. Thereís no reason to pay a higher premium for services you donít require
4. Compare all the policies and determine which one best fits your own requirements and financial situation. Be sure you look for any hidden charges and fees. Some insurers offer low upfront fees, but have several hidden charges and fees, or more restrictions than those with higher premiums. Also take into consideration the companyís financial stability and customer care services. Youíll want a company that provides easy and convenient access to their specialists, especially if you ever need to file a claim or correct a billing statement.

Step four: Buy your policy

The fourth step is to purchase whichever cover seems to best fit your requirements at the most reasonable price. If youíve done your in-depth comparison shopping diligently, you should have several offers to choose from. If you havenít received many offers, go through this entire process again, conducting research both online and off-line.

Once you have purchased the cover, carefully read the entire policy to ensure it contains accurate information. Have any inaccuracies corrected right away, as they may affect any claims you make later. Then store the insurance documents in a safe place. Then just follow the steps in this guide whenever you have to renew or purchase new taxi insurance. The discounts and standard policies may change over time, but the taxi insurance purchasing process will not.

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