The difference between private and public hire taxi insurance is fairly simple, defining what you are and are not covered to do as a taxi driver by your license and insurance policy.
As the name suggests, private hire insurance is designed for vehicles that are only available to book in advance. It would be ideal for a taxi driver who doesn’t pick up customers that have flagged them down or Uber (and other taxi app) drivers who receive their bookings through a mobile app.
Public hire taxi insurance will cover you for both private bookings and customers who have not pre-booked. This means if you don’t have a customer in your vehicle, you’re welcome to pick one up roadside or from a designated taxi rank. Insuring public hire vehicles is naturally a little riskier for insurers – you may have to stop quickly to someone waving you down, and you’ll rarely have time to find a suitable place to park.
Compare that to a pre-booked driver, who knows where they need to be and when they need to be there, allowing them to find a safe spot to park up while they wait for their customer – considerably less dangerous than picking someone up from the side of a busy road. It isn’t hard to see why both need to be insured slightly differently. Don’t be surprised if taxi insurance is cheaper for a private hire taxi than a public hire taxi.
While it can seem like a very minor difference, it’s important to make sure you’re correctly licensed. Your local licensing authority will require proof of your insurance before giving you an operating license, so they’ll know what you are and aren’t covered to do. If you’re caught doing something you’re not covered for, the penalties can be severe, and you may lose your operating license altogether, especially if you’re a repeat offender.
Private hire taxi insurance
Private hire taxi insurance is designed to cover cabs that are only available to hire through pre-booking. This would include through a website, over the phone/radio, or through a mobile app (like the one used by drivers for Uber). Notably, private hire drivers are not covered to pick up passengers who haven’t booked ahead of time, so they can’t pick customers up roadside if they’re hailed down.
Private hire coverage is generally a little cheaper than public hire, so if you don’t anticipate taking passengers who haven’t booked, then it’s worth opting for private hire and saving the money. That being said, if you aren’t 100% sure whether or not you will, make sure to check with the company you work for – they should have a clear policy on whether or not drivers take non-booked passengers.
Saving on private hire taxi insurance works the same as it would for regular vehicle insurance. Drivers with more experience, driving less powerful/smaller vehicles who operate in less risky regions (away from airports, city centres, etc.) will find their quotes considerably cheaper than younger, less experienced drivers in city centres and/or a larger, more powerful vehicle.
Public hire taxi insurance
Public hire taxi insurance includes the same coverages as private hire but will allow you to pick up customers roadside if you’re hailed down. This comes with some additional risk, as having to stop at the side of busy roads, helping customers with their luggage, and getting on the move quickly create plenty of opportunities for accidents to happen.
You should expect to pay a little more for public hire as a result of this risk, but making sure you’re correctly covered is very important. If you’re caught accepting non-pre booked customers, you may lose your license altogether, which is not worth the extra cost of getting correctly insured.
Do I need public hire or private hire taxi insurance?
Which type of coverage you require will depend on how you accept bookings from customers. If you only take pre-bookings, perhaps through a mobile app or over phone/radio, then private hire taxi insurance will be best. However, if you allow customers to flag you down (or collect customers without a booking, say from an airport taxi rank), then you’ll need public hire.
There are only a few differences between the two, but they are important to be aware of. Private hire will not cover you to accept passengers who haven’t pre-booked, so if you intend to accept customers from the roadside, then you’ll need public hire. Keep in mind that your local licensing authority will ask to see proof of your insurance before issuing your license, so make sure you’ve signed up to the correct policy before submitting your documents – your license may be revoked if you’ve submitted the wrong policy.
Public hire will, unsurprisingly, set you back a little more than private hire, given the additional risks of collecting passengers from often busy roadsides and cab ranks, but is absolutely worth it just to make sure you’re not at risk of voiding your coverage or losing your license to operate.