If you use your vehicle to earn money — by carrying passengers or delivering goods — you need hire and reward insurance. Standard car or van insurance won’t cover you. Here’s what it is, who needs it, and what happens if you don’t have it.
Taxi and private insurance
At insurd, we arrange taxi and private hire insurance for all licence types across the UK, with hire and reward included or as an add-on. Get a taxi insurance quote in minutes.
Hire and reward insurance — what it means
Hire and reward insurance is a type of motor insurance that covers you when you’re being paid to transport passengers or goods in your vehicle.
The “Hire” part means someone is paying you. “Reward” means you’re receiving something in return — usually money. The moment money changes hands for a journey or delivery, standard motor insurance stops applying.
It doesn’t matter whether you drive full-time or just a few hours a week. If you’re earning money from your vehicle, you need this cover.
Why standard insurance isn’t enough
Most people assume their car or van insurance covers everything. It doesn’t.
A standard policy covers you for:
- Personal use
- Commuting to a fixed workplace
- In some cases, business use — visiting clients or travelling between sites
It does not cover you for carrying paying passengers or delivering goods in exchange for payment. These activities are classified as hire and reward use — and they require a separate, specific policy.
If you have an accident while working without the right cover, your insurer can refuse to pay out. That means you’d be personally liable for damage, injury claims, or legal costs. You could also face prosecution for driving without valid insurance.
Who needs hire and reward insurance?
You need hire and reward insurance if you’re being paid to use your vehicle — either to carry people or to deliver goods.
Passenger drivers:
- Taxi drivers — black cabs, hackney carriages
- Private hire and minicab drivers
- Uber, Bolt, Free Now and other ride-hailing platform drivers
- Minibus operators carrying paying passengers
Goods and delivery drivers:
- Courier van drivers
- Food delivery drivers — Deliveroo, Uber Eats, Just Eat
- Parcel delivery drivers — Amazon Flex, Evri, DPD, Yodel
- Same-day and multi-drop delivery drivers
- Man and van operators
Even if it’s just a weekend job or a side income, you still need it. There’s no minimum hours threshold. The moment you accept payment for a journey or delivery, you’re operating on a hire and reward basis.
Is hire and reward insurance a legal requirement?
Yes. In the UK, it’s a legal requirement to have the correct class of insurance for the way you’re using your vehicle. Driving for hire and reward without the right insurance is illegal.
The Road Traffic Act 1988 requires that any vehicle used for hire and reward purposes is covered under a policy that specifically permits this use. A standard policy does not.
If you’re stopped by police, involved in an accident, or subject to a spot check while working without hire and reward cover, you face:
- A fixed penalty of £300 and 6 points on your licence
- Potential court prosecution, which can result in an unlimited fine
- Possible driving disqualification
Your vehicle could also be seized.
The difference between passenger and goods cover
Hire and reward insurance covers two distinct types of work — and it’s important to understand the difference.
Carrying passengers for hire and reward
This is sometimes called taxi insurance or private hire insurance. It covers you to transport paying passengers in your vehicle. The type of policy you need depends on your licence:
- Public hire (hackney carriage) drivers can pick up passengers without a prior booking — hailing on the street or at a rank. They need public hire insurance.
- Private hire drivers can only carry pre-booked passengers. They need private hire insurance with hire and reward cover.
Both types require a valid licence from your local licensing authority. The insurance and the licence must align — having one without the other isn’t sufficient.
Delivering goods for hire and reward
This is sometimes called courier insurance or delivery insurance. It covers you for transporting goods belonging to other people or businesses in exchange for payment.
If you’re delivering parcels, food, or any other goods as part of your work — whether full-time, part-time, or through a gig economy platform — you need a policy that includes carriage of goods for hire and reward.
The type of vehicle you use matters too. If you deliver in a van, you need courier van insurance. If you use a car, you need a car policy that includes hire and reward cover for goods.
Does my platform already cover me?
This is one of the most common questions — and the most important to get right.
Some platforms provide limited insurance while you’re actively on a delivery or ride. But this cover is almost always:
- Restricted — it only applies during specific parts of the journey, not between jobs or during personal use
- Third-party only — it doesn’t cover damage to your own vehicle
- Conditional — it may be voided by certain circumstances
Platform cover is not a substitute for your own hire and reward insurance policy. You need both.
For example, an Uber driver’s vehicle insurance during a trip covers basic liability. But if your car is damaged while you’re waiting for a job, or during personal use, you need your own policy in place. The same applies to delivery platforms.
What level of cover can I get?
Hire and reward insurance policies are available at three levels — the same as standard motor insurance:
- Third party only — covers damage or injury you cause to other people and vehicles. The legal minimum. Does not cover damage to your own vehicle.
- Third party, fire and theft — adds protection for your vehicle if it’s stolen or damaged by fire.
- Comprehensive — the highest level of cover. Protects your vehicle against accidental damage as well as third-party claims. Strongly recommended for anyone using their vehicle as a primary source of income.
What about goods in transit cover?
Hire and reward insurance covers your vehicle. It does not automatically cover the goods you’re carrying.
For a courier or delivery driver, goods-in-transit insurance is a separate policy that covers the items in your vehicle if they’re lost, stolen, or damaged during delivery. If goods are damaged and you don’t have this cover, you could be personally liable to the client or platform for the full value.
If you’re arranging courier insurance, it’s worth considering both policies together.
How to get hire and reward insurance
Getting the right cover starts with knowing exactly what type of work you do:
- Are you carrying passengers or goods? — different cover applies to each
- Do you have a licence? — taxi and private hire drivers need a valid licence from their local authority
- Which platforms or clients do you work for? — some have specific insurance requirements
- What vehicle do you use? — car, van, and minibus policies are different products
- Is it full-time or part-time? — both require cover, but the level of use affects your premium
At insurd, we arrange hire and reward insurance for taxi drivers, private hire drivers, and courier van operators across the UK. Our team can help you work out the right type of policy for your situation.
Get a taxi insurance quote, private hire insurance quote, or courier van insurance quote — it takes less than 5 minutes.
FAQs
Is hire and reward insurance more expensive than standard insurance?
Yes — typically. Hire and reward work involves more time on the road, higher mileage, and greater exposure to risk than standard personal use. This is reflected in the premium. The exact cost depends on your vehicle, your driving record, the type of work you do, and where you operate.
Do I need hire and reward insurance for food delivery on a bicycle or moped?
If you use a moped or motorcycle for food delivery, you need a motor insurance policy that includes hire and reward cover for that vehicle. Bicycles don't require motor insurance, but other considerations such as public liability may apply depending on your work arrangements.
Can I switch between personal and hire and reward use on the same policy?
Some policies cover both personal and commercial use — including hire and reward — under a single policy. This means you don't need a separate policy for your personal driving. When you get a quote, declare all the ways you use your vehicle and make sure your policy reflects that.
What happens if I forget to declare hire and reward use?
Your policy would not cover you for any accident or claim arising from your hire and reward activities. Your insurer can reject the claim, cancel your policy, and potentially report you for driving without valid insurance. Always declare your use accurately from the start.
