If you plan to charge customers for driving them from A to B regular car insurance won't suffice. Instead you'll need to look to taxi insurance to get the protection you need.
However there is more than one type of taxi insurance out there, and while the right cover will protect you financially, the wrong policy could leave you liable for costs that you cannot afford.
Before you begin to look at taxi insurance companies or specific quotes it is vital that you understand what taxi insurance is and what you need from a policy.
What is taxi insurance?
It can be split broadly into two categories; public hire taxi insurance and private hire taxi insurance.
Public hire taxis are allowed to be hailed by customers without prior booking, they're also known as 'hackney carriages' and the best example is a London black cab.
Private hire taxis can only be dispatched to appointments arranged by a customer.
Most insurers offer private hire taxi insurance and/or public taxi hire insurance options across their policies, so make sure you choose the option that reflects your work.
What types of taxi are covered?
The types of taxi covered does vary from policy to policy but generally black cab insurance, hackney carriage insurance, London taxi insurance, taxi minibus insurance and MPV taxi insurance are available from most insurers.
Mini cabs usually fall into the MPV insurance bracket - multi purpose vehicles (i.e. people carriers) used as private hire taxis. Often mini cab insurance cannot be extended to other types of vehicle.
Some UK taxi insurance providers offer taxi fleet insurance to cover multiple vehicles, although this tends to be via specialist taxi fleet insurers only.
The maximum number of passengers each type of taxi is allowed to carry per journey is limited by law. You need to make sure you know how many passengers you're allowed to transport at one time and ensure that your taxi is insured up to that limit.
What level of cover?
UK taxi insurance offers the traditional options of Third Party, Third Party Fire & Theft, and Comprehensive insurance.
However there are some aspects of taxi insurance cover that are particularly valuable, so you should check:
What type of taxi is covered? Some insurers restrict their cover based on private or public hire, so make sure your custom is covered by any policy you consider. The same applies to checking that the type of taxi you drive is protected by the policy too.
Is public liability insurance included? Not all providers offer public liability cover, but it can give you vital financial protection against healthcare or damages costs from your passengers.
Unlimited mileage policies: If driving is your job, you don't want to be penalised for it. However, check your annual mileage is high enough to warrant the slightly increased cost.
Who is the driver?
Because of the level of risk for the insurer, the minimum age for cover by a taxi insurance policy is often set slightly higher than standard car insurance policies.
Insurance under 25 can therefore be a little more difficult to find, but it is available from some providers although you may find you have to pay more. You're likely to find that there is a difference in the minimum age for public hire and private hire taxi insurance cover so if you're a young taxi driver your options may be limited.
You can usually opt to name additional drivers on a policy if you need, although the cost of taxi insurance tends to rise with the number of drivers. Any driver policies are also available which effectively insures the car rather than its drivers.
Some insurers allow drivers to transfer their existing No Claims Discount across from a personal policy, but not all. A taxi insurance comparison will help you find companies that offer discounts for NCDs.
Many taxi insurance policies will insure you for personal use in addition to commercial use - this is something worth checking if you use your taxi to get around when you're not working. However, check with your local authority before paying to name a spouse or partner on your policy, as unregistered drivers aren't always permitted to drive registered (plated) taxis.
Length of cover needed?
Many taxi insurance companies now offer short term insurance, e.g. a 1 month term. However 12 month policies are still the most common so you'll need to shop around amongst policies that offer a suitable level of cover.
Terms and conditions
You need to check the terms and conditions of any policy that you take out and make sure you adhere to them so you don't invalidate your insurance.
Many insurers request full details of all of your previous claims for a minimum length of time, e.g. the last 5 years. This may change by insurer or by policy, so find out what information they require and make sure you can provide it.
Some insurers don't cover London based taxi drivers, so if you that's what you need, it may be worth searching for insurers that specialise in a policy that is right for your needs.
How to get the best taxi insurance quote
Check if taxi breakdown cover is included in the policy, available as an add-on, or if you have to make separate arrangements. Also check if the policy offers plated courtesy cars and replacement taxis, this could be invaluable if you are a sole trader.
Some taxi insurance companies offer discounts for new drivers and new ventures. If this applies to you, look for these discounts on suitable policies to find a cheap taxi insurance online quote.
Once you decide what level of cover you need, you can use our taxi insurance comparison to view policies that offer the right level of cover side by side and find the cheapest private or public hire taxi insurance possible.