ALERT: CHECK YOUR INSURANCE! “
Article by Dave Lawrie, Director NPHTA
dave@nphta.co.uk
This month we focus on insurance policy wording, check the details, make sure you are clear in the insurance that you need. This comes following an alert raised to us by Colchester council which sent an email out to operators that read:
“Dear Operator
It has come to our attention that some hackney carriages that are sub-contracted to undertake journeys via private hire operators may not have adequate insurance in place.
If a hackney carriage undertakes journeys for a private hire operator, even only occasionally, they are required to have both public hire insurance and private hire insurance.
As an operator you have a duty to check the vehicle insurance policies for the vehicles you use. Please check the wording of the vehicle insurance policy carefully to ensure there is the correct cover in place and ask the vehicle owner to check with their insurance provider if you are unsure.
Where vehicles do not have adequate insurance for their use, the council will take enforcement action, which is likely to result in the suspension of vehicle licences and the issuing of penalty points
If an incident occurs whilst a vehicle is working for you without the correct insurance, you are at risk of prosecution.”
I was confused about this suggestion, and reached out to as for a copy of such policy wording, which the council were kind enough to provide as follows:
“
EXCLUSIONS The Policy does not cover use
(a) for hire or reward other than for the carriage of passengers for hire or reward under a Hackney Carriage Licence.
Now this was not expressly excluding pre-booked, since of course it states “under a hackney carriage license, which is allowed by law to fulfil prebooked jobs.
”
Is this wording correct? But there was another example as follows:
42 LIMITATIONS AS TO USE
Use for the business of the Policyholder as a Public Hire operative including the carriage of passengers for Hire and Reward purposes and in accordance with the requirements of the declared licensing authority.
Use in connection with the Policyholders business or profession, including Social Domestic and Pleasure purposes.
EXCLUDING
Use for racing, pacemaking, competitions, rallies, track days, trials or speed tests whether on road, track, off-road, land prepared for such use....... carriage of passengers for Private Hire, carriage of goods for hire and reward, commercial travelling or any use in connection with the motor trade.
We found this situation particularly unusual, so we contacted our insurance partners who all agreed that the policy wording is ambiguous and open to interpretation.
”
Their view was that, while a private hire policy does not cover taxi work (i.e. journeys that are not pre-booked through an operator), the reverse does not necessarily apply. This makes the wording confusing and potentially concerning.
As we know, any hackney carriage (taxi) can legally undertake pre-booked journeys accepted from any source, whether booked directly with the driver in advance or through a private hire operator. The “triple lock” rule does not apply to hackney carriages. This is one of the reasons why there was a significant increase in hackney carriage licence applications following the Berwick case, which helped clarify the legislation. Given this, it is difficult to understand why an insurance policy would seek to exclude this ability.
With that in mind, we strongly recommend that you carefully review your insurance policy wording. If the wording is incorrect or misleading, it could potentially create licensing issues through no fault of your own. More importantly, you may find that you are not insured for work you reasonably believed was covered.
However, it is worth noting that most insurers are extremely helpful. During the Covid pandemic, for example, many were quick to extend policies to include food delivery work to help drivers continue earning during difficult times.
JULY 2026 PHTM
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