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Taxi and private hire
Taxi insurance is motor insurance that covers a vehicle while it carries paying passengers, written for either public hire (hackney carriage) or private hire use. It matters because no licensing authority will license the vehicle without it, and a policy written for the wrong type of hire may not respond when a passenger or third party claims.
Part of: Commercial vehicle insurance
In short
Every taxi and private hire vehicle must be insured for the way it is actually used. A hackney carriage can be hailed in the street and wait on ranks, so it needs public hire cover. A private hire vehicle may only take pre-booked work through a licensed operator, so a private hire policy is usually the right fit. Councils outside London, and Transport for London in London, must be satisfied that insurance is in force before they license a vehicle. Operators and firms running several cars usually need further cover, such as public liability, employers' liability and a fleet policy.
The legal split is old. Under the Town Police Clauses Act 1847 a council may license hackney carriages "to ply for hire" (section 37), and section 45 makes it an offence to let an unlicensed vehicle ply for hire. Private hire vehicles outside London are licensed under Part II of the Local Government (Miscellaneous Provisions) Act 1976, which a district council brings into force by resolution (section 45). In London, Transport for London licenses taxis and private hire, the latter under the Private Hire Vehicles (London) Act 1998. Our private hire definition sets out the basics.
Insurers follow the same line. A public hire policy usually covers street hails, rank work and pre-booked jobs. A private hire policy usually covers pre-booked journeys only. The Department for Transport's statutory standards tell passengers that a private hire vehicle that has not been booked in advance "will not be insured and may not be licensed". Our public hire vs private hire guide covers the differences in detail.
| Vehicle | How it gets work | Licensed by | Policy usually needed |
|---|---|---|---|
| Hackney carriage (taxi) | Street hails, ranks and pre-booked jobs | District council; Transport for London for London cabs | Public hire |
| Private hire vehicle (fewer than nine passengers) | Pre-booked only, through a licensed operator | District council; Transport for London in London | Private hire |
| Vehicle carrying nine or more passengers for hire or reward | Pre-arranged hire | Traffic commissioner (PSV operator licence) | Minibus or passenger carrying vehicle cover |
Insurance is a condition of the licence itself, not just a motoring rule:
Behind all of this sits section 143 of the Road Traffic Act 1988, which makes it an offence to use, or cause or permit someone else to use, a vehicle on a road without insurance "in relation to the use of the vehicle". Councils can also add conditions to licences (section 48(2) of the 1976 Act), and many ask for the certificate at each renewal. Compulsory cover is explained in our compulsory motor insurance entry.
Ordinary business use classes do not usually extend to carrying passengers for payment. See hire and reward insurance for why that matters.
A business that takes bookings needs an operator's licence (section 46(1)(d) of the 1976 Act), and section 56(1) deems every hire contract to be made with the operator who accepted the booking. In D.E.L.T.A. Merseyside v Uber Britannia [2025] UKSC 31 the Supreme Court held that operators outside London need not contract as principal, but confirmed that section 56(1) makes the operator liable on the hire contract. In London, an operator whose operating centre is accessible to members of the public must hold public liability cover of at least £5,000,000 for any one event (regulation 9(2)).
If you employ staff, employers' liability insurance is compulsory, with a minimum of £5 million according to HSE guidance. Operators should read our private hire operator insurance guide, and businesses with several vehicles our taxi fleet insurance guide.
Executive and chauffeur work in a car carrying up to eight passengers is generally private hire. GOV.UK guidance says small limousines need a private hire operator licence, large limousines seating nine or more need a PSV operator licence, and vehicles with up to eight passenger seats do not need a licence for weddings and funerals. High-value vehicles and corporate contracts raise their own questions, covered in our chauffeur and executive car insurance guide.
Expect questions on the licensing authority and badge type, each vehicle (make, model, value, seats, any wheelchair conversion), each driver (age, years licensed, convictions, hire experience), the type of work (rank, pre-booked, school or council contracts, airport runs), mileage, overnight parking and claims history. Under the Insurance Act 2015 a business must make a fair presentation of the risk, so tell the insurer about changes such as a new licensing authority or a move into rank work.
Illustrative: a private hire driver accepts a street hail outside a club late at night and collides with a cyclist. The journey was not pre-booked, so it falls outside the private hire licence and likely outside the policy's permitted use. The insurer may dispute cover or try to recover what it pays out, and the driver faces licensing and criminal consequences.
Apex arranges taxi and private hire insurance for drivers, operators and fleets. A broker reads each enquiry and comes back with options, and there is no fee for a quote; cover is always subject to the insurer's acceptance and the policy terms. To quote we need your business activities, turnover, location and claims history, plus the licensing authority, badge type, vehicle details and values, and each driver's age and licence history. For operators, also tell us booking volumes and staff numbers.
Usually not. Standard business use classes commonly exclude carrying passengers for payment, which is hire and reward use. Driving paying passengers without the right cover risks an uninsured driving offence under section 143 of the Road Traffic Act 1988, and the licensing authority will not license the vehicle without suitable insurance.
No. Private hire vehicles may only take pre-booked work through a licensed operator, and private hire policies are usually written on that basis. The Department for Transport's statutory standards warn that a private hire vehicle not booked in advance will not be insured and may not be licensed. Street hails need a hackney carriage licence and public hire cover.
The council must be satisfied that a policy complying with Part VI of the Road Traffic Act 1988 is in force for the vehicle's use before it grants a private hire vehicle licence. Many councils ask for the certificate at each grant and renewal, and the proprietor must produce it on request under section 50(4) of the 1976 Act.
There is no general legal requirement for individual drivers, but some councils and contract clients ask for it, so check your licence conditions. In London, private hire operators whose operating centre is accessible to members of the public must hold at least £5,000,000 of public liability cover for any one event.
Transport for London licenses London taxis and private hire vehicles, drivers and operators. Outside London, local councils license them in England and Wales under the 1847 and 1976 Acts. In Scotland, local licensing authorities license taxis and private hire cars under the Civic Government (Scotland) Act 1982.
Tell us what your business does, your turnover and any claims. A broker reads every enquiry and comes back with options. No fee for a quote. Or call 0117 325 0027.
Start a commercial enquiry Request a callbackApex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales, company number 07014570. This page is general information, not advice on your individual circumstances, and it does not guarantee that cover will be available or on what terms.
