Similar to commercial truckers, taxi drivers require a special type of insurance above standard auto insurance to help cover their vehicles and other possible costs in the event of an accident. Due to the large amounts of time spent driving, as well as the extra potential for injury with multiple people in the car, the cost of taxi insurance can be quite high in comparison to regular auto insurance.
Just as auto insurance is required for noncommercial drivers to operate their vehicle legally, taxi drivers need to be insured with taxi insurance to legally operate their business and comply with standards. Generally, high levels of coverage are needed to help protect the company against potential damages, so premium rates are often high enough to warrant weekly billing. In addition to weekly premium payments, a premium down payment is often required to offset costs to the insurance company if a claim is made early in the process.
This is generally about 20% of the annual policy cost, and can be a big obstacle in obtaining an excellent level of coverage as costs can easily get out of hand. Unfortunately, many taxi companies operate in a manner that results in multiple extraneous claims being filed which drives the cost of premiums up for the industry as a whole. However, some insurance providers offer discounts for safe driving and taking proper precautions, as well as following procedure during the operation of taxi services.
To reduce costs up front, operators can opt for a third-party only insurance that only covers damages to a third-party, but this may result in high costs to the operator in the case of their own vehicle being damaged.
Two main types of taxi insurance exist, one for public hire or “black cab” services, and one for private hire services. Private hire taxis require booking in advance and do not operate with a taxi sign or search for hire in the streets. In obtaining taxi insurance, many providers have a set of criteria to help protect themselves against excessive claims. Some of these may include requiring owners to have a certain level of experience, as well as putting a limit on the age of vehicles that can be insured. Additionally, well-documented safety procedures and a fairly clean accident record may be required to obtain the insurance initially, as well as reduce premium costs after the policy is drafted. Not all providers will provide insurance to public hire services, so it is important to research what is offered.
Though costs may be high, taxi insurance is a required and vital part to the operation of a successful taxi service. By opting to pay a little bit more up front, vehicles and drivers will be protected against potential risks of driving day in and day out, and the company has added financial security in the event of an accident.
Just as auto insurance is required for noncommercial drivers to operate their vehicle legally, taxi drivers need to be insured with taxi insurance to legally operate their business and comply with standards. Generally, high levels of coverage are needed to help protect the company against potential damages, so premium rates are often high enough to warrant weekly billing. In addition to weekly premium payments, a premium down payment is often required to offset costs to the insurance company if a claim is made early in the process.
This is generally about 20% of the annual policy cost, and can be a big obstacle in obtaining an excellent level of coverage as costs can easily get out of hand. Unfortunately, many taxi companies operate in a manner that results in multiple extraneous claims being filed which drives the cost of premiums up for the industry as a whole. However, some insurance providers offer discounts for safe driving and taking proper precautions, as well as following procedure during the operation of taxi services.
To reduce costs up front, operators can opt for a third-party only insurance that only covers damages to a third-party, but this may result in high costs to the operator in the case of their own vehicle being damaged.
Two main types of taxi insurance exist, one for public hire or “black cab” services, and one for private hire services. Private hire taxis require booking in advance and do not operate with a taxi sign or search for hire in the streets. In obtaining taxi insurance, many providers have a set of criteria to help protect themselves against excessive claims. Some of these may include requiring owners to have a certain level of experience, as well as putting a limit on the age of vehicles that can be insured. Additionally, well-documented safety procedures and a fairly clean accident record may be required to obtain the insurance initially, as well as reduce premium costs after the policy is drafted. Not all providers will provide insurance to public hire services, so it is important to research what is offered.
Though costs may be high, taxi insurance is a required and vital part to the operation of a successful taxi service. By opting to pay a little bit more up front, vehicles and drivers will be protected against potential risks of driving day in and day out, and the company has added financial security in the event of an accident.
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