All businesses carry a certain amount of financial risk, and while it is possible to reduce risk to some degree, it can never be totally eliminated. However, it is possible to prepare and protect yourself from the financial damage that your business may suffer in the event that such risks become reality. For taxi drivers, the best means of protecting yourself and your business is by having a robust taxi insurance policy which covers you against the things that could negatively impact on your finances the most.
Here we’ll take a look at some of these big and potentially catastrophic risks, and at the types of taxi insurance that can shield you against such financial damage.
ehicle itself is of course the most crucial of all your assets, and it’s safe to say that without it you wouldn’t be in business for long. Therefore protecting your financial investment in it and your use of it should be a top priority. You do of course need specially tailored taxi insurance which takes into account your commercial use of the vehicle, the mileage you do and the specific risks of your work (such as whether you’re hackney or private hire). In doing so you should take care to make sure that your policy covers you for the full amount of the vehicle’s value, and you should ensure that you declare any modifications you have made (failure to do so may result in the policy being ruled void).
To provide full cover for your vehicle, including the cost of a replacement vehicle, you should opt for comprehensive taxi insurance coverage which will pay out in the event that your taxi is damaged or written off. It may also be worth considering investing in gap insurance which will pay out the difference between what your car is insured for and what its market value is reckoned to be when it is written off. Gap insurance will also help you to make sure that you can pay off any finance that may be left to pay on the vehicle which might not otherwise be covered by your standard insurance payout.
Finally in terms of your vehicle, taking out breakdown cover can help you get back on the road as quickly as possible and reduce any downtime which could otherwise be spent picking up fares. It may also be worth investing in cover which will provide you with a suitable replacement vehicle while your own is being repaired.
Protection against injury and illness
If you’re a self-employed taxi driver then it’s important to have a financial safety net to cover you for any periods in which you’re unable to work. Personal accident insurance can help to keep you afloat after an accident in which you suffer an injury, by paying out a lump sum or even covering any loss of earnings while you recover. Health insurance meanwhile can fund the cost of any treatment you require and help you get back on your feet as quickly as possible.
Protection against lawsuits
As you’re dealing with members of the public in your work every day, no matter how careful you are there is always the chance that you will be involved in an accident in which somebody suffers injury or loss and you are held to blame. In such an event, you may find that a compensation claim is made against you by a passenger or another member of the public, and if this is successful then you could potentially have to pay out a hefty sum in compensation. Public liability insurance will protect you in this eventuality, and will pay out the full amount of compensation, so you don’t have to worry about the money coming out of your own savings or your business.
These are the main ways that taxi drivers can secure their livelihood and protect their finances.
Marc Loud is a partner at Park Insurance, for over 30 years of experience who cover a range of specialist sectors including courier insurance.
