Driving a taxi is a good way to earn a living — but the moment you start carrying paying passengers, your everyday car insurance stops working for you. Here's what cover you actually need, in plain English.

Taxi insurance covers drivers who carry fee-paying passengers. You'll also see it called hire and reward (or H&R). It protects you, your vehicle and your livelihood if a passenger or another road user makes a claim against you.

“Taxi insurance” is really a catch-all. It covers private hire vehicles, black cabs and drivers working for platforms like Uber and Bolt. Below, we break down the different types, what each level of cover gives you, and the things that push the price up or down.

Private hire vs public hire: what's the difference?

The type of licence you hold decides the type of cover you need. There are two.

Private hire insurance covers licensed drivers carrying pre-booked passengers for payment. If someone books you through an app or rings the office ahead, that's private hire. You'll sometimes see it called minibus or PCO insurance. This is the cover most app-based drivers need.

Public hire insurance covers Hackney Carriages — the licensed cabs that can be flagged down in the street or picked up at a rank without booking ahead. It's also known as black cab insurance. The cover is similar to private hire; the difference is how you pick up your fares.

One thing both have in common: your standard motor policy — the social, domestic and pleasure cover most drivers have — won't cover you for either. Carrying paying passengers is a business activity, and it needs a business policy.

Do Uber and Bolt drivers need taxi insurance?

Yes. If you drive for Uber, Bolt or any other ride-hailing platform, insurers treat you as running a private hire service — so you need private hire taxi insurance in place before you start taking fares.

It matters more than the paperwork suggests. If you have an accident on the job without the right cover, your claim will very likely be turned down — leaving you to foot the bill yourself. It's not worth the risk.

What level of cover do you need?

Taxi insurance comes in the same three levels as regular car insurance:

Third party only — the legal minimum. Covers damage or injury you cause to other people, but not your own vehicle.

Third party, fire and theft — the above, plus cover if your vehicle is stolen or damaged by fire.

Fully comprehensive — the fullest cover, including damage to your own vehicle even when a claim is your fault.

Beyond the level itself, a few extras are worth weighing up as a professional driver:

Public liability cover. This protects you if a passenger is injured, or their property is damaged, while getting in, riding in, or getting out of your taxi. It covers the legal and compensation costs that can follow — and for many drivers it's the single most valuable piece of the policy.

Personal use cover. Planning to use the same vehicle for the school run or the weekly shop? You'll want cover for personal driving too. Check with your local licensing authority first, as the rules on driving a licensed taxi off-duty vary from area to area.

Unlimited mileage. Taxi drivers clock up serious miles. An unlimited-mileage policy means you're not caught out by extra charges for going over a cap.

Breakdown cover. Your vehicle is your business, so a breakdown isn't just inconvenient — it's lost income. Taxis spend far more time on the road than most cars, and not every insurer offers breakdown cover built for them, so it's worth checking.

You can also usually choose who's covered to drive:

• Named driver cover — just you.
• Any driver cover — anyone suitably licensed and able to drive your taxi.

What affects the cost of taxi insurance?

Taxi insurance is priced on many of the same things as ordinary car insurance — where you live, your driving history, the vehicle you drive — but it usually costs more. Three reasons why:

• Taxi drivers cover far more miles a year than the average driver.
• Carrying passengers raises the chance of a personal injury claim.
• The job often means driving in busy areas at the busiest times of day.

Each of those nudges up your risk of an incident, and that's reflected in the price.

How to bring the cost down

You can't change the fact that you drive for a living — but you can do plenty to keep the price fair:

Pick a sensible vehicle with a smaller engine.

Fit extra security, like a dashcam or CCTV.

Build up your no-claims history.

Pay annually and upfront rather than monthly, if you can.

Choose a policy that rewards how you actually drive — like Zego Sense, which uses app-based data to measure your driving. Drive well, and you could pay less at renewal.

And the golden rule: always shop around and compare before you commit.

Extra requirements for London drivers

If you're driving in the capital, Transport for London (TfL) sets a couple of extra hurdles:

English language requirement. Since 2016, TfL has required all licensed private hire drivers to prove their English before getting a licence. Our guide to passing the TfL English test walks you through it.

PCO licence. As a private hire driver in London, your vehicle must be covered by hire and reward insurance from the point of licensing. PCO stands for Public Carriage Office — the part of TfL that oversees the capital's taxis.

What is decommissioned taxi insurance?

If you stop driving your vehicle as a taxi — because you've retired, sold up, or moved on — decommissioned taxi insurance covers you for any liability or damage while it's no longer working as a cab. Always tell your insurer when you decommission, so they can put the right cover in place.

Can I carry paying passengers on my normal car insurance?

No. If you're driving a paying customer, a standard car or van policy won't cover you. You need taxi insurance — hire and reward — before you take your first fare.

Get the right taxi cover with Zego

We know your vehicle is your livelihood. Whether you drive for Uber, Bolt or a local operator, the right cover keeps you and your passengers protected every day.

Our Private Hire (Hire & Reward) insurance is built for professional drivers, with the flexibility to choose 30-day or annual cover. Both are fully comprehensive and designed to get you back on the road quickly if things go wrong.

Choose a Zego Sense policy and your driving does the talking — our app-based telematics rewards good driving with a fairer price at renewal.

Get a quote — it only takes a minute.

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