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Under the Road Traffic Act 1988 all private hire insurance operating in the UK have to have the correct type of motor insurance. Failure to do so is an offence under the Act which is liable to prosecution. The courts can impose fines and/or penalty points on the driver’s license and in some cases driving bans.

The only exception to this requirement is private Hire Vehicles which are only used for weddings and funerals. They still require valid motor vehicle insurance but not one that is specifically designed for all other types of private hire insurance.

Private hire services and operators work in all manner of different situations, from taking people to the airport, stretch limousines for special occasions, tourist guides or those who take and collect people for a night out or collect from a supermarket. All are required by law to have an operator’s license and valid private hire insurance cover.

To make it easier for the public to have peace of mind that the private hire operator is legitimate the driver should wear their operator’s license card at all times. This includes a photograph and the name of the driver. It is an offence for drivers not to make their operator’s license visible at all times.

It is illegal for a private hire vehicle to be flagged by in the street by a fare paying passenger. Only licensed hackney carriages are allowed to do this. private hire drivers who stop and pick up un-booked customers can find themselves liable to prosecution and facing hefty fines and penalty points on their license.

Members of the public who wish to use the services of a private hire vehicle must pre-order by phone, online or by calling into the operator’s business office.

Operators are required to keep a log of all customers which includes the collection address and the customer’s name. They should also determine whether any special arrangements are required - such as having the ability for including an assistance dog within the vehicle. Again it is an offence for them to fail to comply.

Don’t be caught out be agreeing an insurance policy which does not provide the necessary cover for your business needs. There are different private hire insurance policies available from insurance companies who specialise and are knowledgeable of the requirements needed to operate a legitimate private hire business. They will discuss individual needs and budgets and provide advice accordingly.

For added peace of mind it may be worth looking to see whether the insurance company is regulated by the Financial Services Authority. As with most other types of motor insurance savings can be made if the driver has earned no claims discount which can be proven.

Other savings can be made by having third party only cover; however it is advisable to opt for additional Public Liability cover as the public are the people using the private Hire services.

Those who operate in high risk areas, such as inner cities and large towns may also be advised to go to the next level of private hire insurance which provides third party cover plus additional cover for fire and theft.

Paul Headley is a specialist insurance article writer. Staveley Head are a leading UK insurance broker for
private hire insurance

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