What is hire and reward insurance, and when do you need it?

Reviewed by: Lee Evans
Business & Leisure Insurance Expert

Written by: Katie Gawley
Insurance Content Writer

Fact-checked by: Quotezone Editorial Team

This content follows our Editorial Guidelines

Last Updated: 13 October 2026
Read time: 12 min

A standard personal motor policy usually does not cover carrying other people’s goods, or passengers, in return for payment. Hire and reward insurance is the motor cover that includes that work.

This guide explains what the law asks for, how your certificate decides whether you are covered, and what driving outside it can cost.

Jump to information on:

• What is hire and reward insurance?
• Does the law require it?
• What does the policy pay for?
• What the policy usually leaves out
• Who needs this cover?
• Is business use the same thing?
• What happens if you deliver without it?
• How much does the cover cost?
• Hire and reward insurance FAQs

What is hire and reward insurance?

Hire and reward is a class of use on a motor policy that lets you carry goods or people for payment. Other classes include social, domestic and pleasure (SDP), commuting, business use and carriage of own goods. The Quotezone guide to van insurance classes of use explains each one.

For goods, the term covers paid delivery of things such as parcels, takeaway food and groceries, as Quotezone’s product page describes. That includes work for delivery apps.

For passengers, the Public Passenger Vehicles Act 1981 sets a test for its own purposes in Great Britain. A vehicle is treated as carrying passengers for hire or reward when:

“payment is made for, or for matters which include, the carrying of passengers, irrespective of the person to whom the payment is made”.

If you need cover for paid delivery work, you can compare hire and reward quotes on Quotezone with one short form.

Quotezone matches your details to policies from a range of UK insurers, so the quotes you see are ones that fit your work. Providers shown include Onesure, Riviera Business and Arma Insurance.

Does the law require it?

Yes, in effect, if you are paid to carry goods or passengers. In Great Britain, section 143 of the Road Traffic Act 1988 makes it an offence to use a motor vehicle on a road or other public place without insurance. The policy must be in force “in relation to the use of the vehicle by that person”.

In Northern Ireland, Article 90 of the Road Traffic (Northern Ireland) Order 1981 sets the same duty. The other Road Traffic Act sections quoted on this page apply in Great Britain only.

Your policy has to cover what you are doing on the journey. Driving outside your class of use means the policy does not cover that trip. GOV.UK states that “Third party insurance is the legal minimum.”

What does the policy pay for?

A hire and reward policy covers your vehicle while you use it for paid work, at the cover level you choose. Section 145 of the Road Traffic Act 1988 sets the compulsory part, and the rest depends on the policy.

GOV.UK notes that third party cover “does not cover any other costs like repair to your own vehicle”. Check your schedule before you assume repairs are included.

What the policy usually leaves out

The biggest gap is the goods themselves. Section 145 says a compulsory motor policy does not have to cover “damage to goods carried for hire or reward in or on the vehicle”. To cover the parcels or the food, you would need separate goods in transit insurance.

Quotezone’s product page lists other typical exclusions to look for in your wording:

• Use outside the insured class, even where the work is also paid delivery.
• Drivers not named on the policy. You can add named drivers or choose any driver cover.
• Work outside the UK, unless the policy includes specific European cover.

Who needs this cover?

Unless one of the exceptions below applies, you need it when someone pays you to carry goods or passengers in a vehicle you drive, however few hours you work. As the Motor Insurers’ Bureau (MIB) says, “If you start making deliveries, you’d need hire-and-reward cover.”

Food and grocery delivery

Paid delivery of takeaways or shopping, for an app or a restaurant, needs this class of use. Food delivery insurance is written for that work.

Parcel and multi-drop delivery

Multi-drop parcel rounds need it too, including work through a parcel delivery app. Courier insurance is the version for this work in a car or van, or on a motorbike.

Removals and man and van work

Moving other people’s furniture for payment can fall outside a policy for carriage of own goods, depending on the certificate’s wording. In a 2023 Financial Ombudsman decision, a van insured for own goods was stolen. The insurer declined the claim after the owner described his work as furniture removals.

The ombudsman found that removals did not fall within carriage of own goods on that certificate. It ordered a premium refund and let the decline stand.

Carrying passengers for payment

Paid passenger journeys count as hire or reward unless they fall within the lift-share rule in the FAQs. In England and Wales you also need a taxi or private hire driver licence from your local council, or from Transport for London. GOV.UK notes a different process in Scotland and Northern Ireland. The cover itself is private hire insurance.

Larger vans and lorries

In Great Britain, you’ll usually need a goods vehicle operator licence to carry goods for hire or reward in a vehicle over 3.5 tonnes gross plated weight. Where there is no plated weight, the threshold is 1,525kg unladen.

The same guide also requires a licence for some international hire or reward work in lighter vans. In Northern Ireland, the Department for Infrastructure handles operator licence applications. Quotezone’s guide to operator’s licences covers the thresholds in more detail.

When you don’t need it

Carrying your own tools or stock is carriage of own goods. Lift sharing, legal e-bikes and employers’ vehicles are covered in the FAQs.

Is business use the same thing?

No. The MIB describes business use as driving beyond your commute to a single workplace, such as travelling between sites or to a meeting. Quotezone’s hire and reward page notes that standard motor policies do not include carriage of goods for hire and reward, “even if you have business use cover”.

The exact wording on your certificate decides it, as the restaurant case in the FAQs shows. If your policy says business use and you’ve started delivering for pay, ask your insurer before your next shift. Quotezone’s guide on how your job affects car insurance covers declaring your work.

What happens if you deliver without it?

If your policy does not cover the work, you are using the vehicle uninsured for that journey. In Great Britain, the police can give you a fixed penalty of £300 and 6 points “if you’re caught driving a vehicle you’re not insured to drive”, according to GOV.UK.

They can also seize the vehicle under section 165A of the Road Traffic Act 1988, and GOV.UK says they can destroy it in some cases. In court, you face an unlimited fine and possible disqualification.

The offence is recorded as endorsement code IN10. Its 6 to 8 points stay on your record for 4 years from the date of the offence.

If an insurer pays the person you hit, section 151 of the Road Traffic Act 1988 gives it a right in some cases to recover that sum from you. Quotezone’s guide to driving without insurance covers the wider consequences.

The Department for Transport consulted from January to May 2026 on motoring penalties, including driving without insurance. The outcome had not been published on 13 October 2026.

How much does the cover cost?

This guide does not quote an average price. Quotezone’s hire and reward page lists what a quote is based on. That includes your vehicle, your age and driving record, where you work, your hours and mileage, and what you carry.

You might also need

• Goods in transit insurance: for the parcels or food you carry, which a motor policy can leave out.
• Van insurance: for the van itself when it is not on paid rounds, or if you move from a car to a van.
• Private hire insurance: if your paid work moves from goods to pre-booked passengers.

Hire and reward insurance FAQs

Do you need it if you only deliver part-time?

The law asks whether your policy covers the use you are making of the vehicle, however few hours you work (section 143). A paid delivery on an SDP policy usually leaves you uninsured for that journey. The exact result depends on your certificate’s wording, so check the limitations as to use before you start.

Does lift sharing count as hire and reward?

In Great Britain, not if you stay within section 150 of the Road Traffic Act 1988. Separate fares are treated as within an SDP policy if the vehicle is not adapted for more than eight passengers and is not a motorcycle.

The fares must not exceed the journey’s running costs, including wear and depreciation, and be agreed before the journey. The rule covers passengers only.

Can an online insurance check show your class of use?

It cannot. The MIB’s free Check Your Vehicle service shows whether a live policy exists on your own vehicle. The MIB says it does not tell you whether you hold the right policy for what you use the vehicle for.

Its paid search on another vehicle, askMID, is being renamed Check Their Vehicle, the MIB has announced. Your certificate is where the class of use appears.

Sources

1. legislation.gov.uk, “Road Traffic Act 1988, section 143”, https://www.legislation.gov.uk/ukpga/1988/52/section/143. Accessed 13 October 2026.
2. legislation.gov.uk, “Road Traffic (Northern Ireland) Order 1981, Article 90”, https://www.legislation.gov.uk/nisi/1981/154/article/90. Accessed 13 October 2026.
3. GOV.UK, “Vehicle insurance”, https://www.gov.uk/vehicle-insurance. Accessed 13 October 2026.
4. legislation.gov.uk, “Road Traffic Act 1988, section 145”, https://www.legislation.gov.uk/ukpga/1988/52/section/145. Accessed 13 October 2026.
5. legislation.gov.uk, “Public Passenger Vehicles Act 1981, section 1”, https://www.legislation.gov.uk/ukpga/1981/14/section/1. Accessed 13 October 2026.
6. Quotezone, “Hire and Reward Insurance”, https://www.quotezone.co.uk/courier-insurance/hire-and-reward, last updated 9 March 2026. Accessed 13 October 2026.
7. Motor Insurers’ Bureau, “How to check if you’re properly insured”, https://www.mib.org.uk/check-and-stay-insured/am-i-insured/. Accessed 13 October 2026.
8. Financial Ombudsman Service, “Decision DRN-4522437”, https://www.financial-ombudsman.org.uk/decision/DRN-4522437.pdf, final decision December 2023. Accessed 13 October 2026.
9. GOV.UK, “Driver licences for taxis and private hire vehicles”, https://www.gov.uk/taxi-driver-licence. Accessed 13 October 2026.
10. Traffic Commissioners for Great Britain, “Goods vehicle operator licensing guide”, https://www.gov.uk/guidance/goods-vehicle-operator-licensing-guide, last updated 2 October 2025. Accessed 13 October 2026.
11. nidirect, “Goods vehicle operator licensing: licence applications”, https://www.nidirect.gov.uk/articles/goods-vehicle-operator-licensing-licence-applications. Accessed 13 October 2026.
12. GOV.UK, “Vehicle insurance: Driving without insurance”, https://www.gov.uk/vehicle-insurance/driving-without-insurance. Accessed 13 October 2026.
13. legislation.gov.uk, “Road Traffic Act 1988, section 165A”, https://www.legislation.gov.uk/ukpga/1988/52/section/165A. Accessed 13 October 2026.
14. GOV.UK, “Penalty points (endorsements): endorsement codes and penalty points”, https://www.gov.uk/penalty-points-endorsements/endorsement-codes-and-penalty-points. Accessed 13 October 2026.
15. legislation.gov.uk, “Road Traffic Act 1988, section 151”, https://www.legislation.gov.uk/ukpga/1988/52/section/151. Accessed 13 October 2026.
16. Department for Transport, “Proposed changes to penalties for motoring offences”, https://www.gov.uk/government/consultations/proposed-changes-to-penalties-for-motoring-offences, published 7 January 2026, closed 11 May 2026, outcome not published. Accessed 13 October 2026.
17. legislation.gov.uk, “Road Traffic Act 1988, section 150”, https://www.legislation.gov.uk/ukpga/1988/52/section/150. Accessed 13 October 2026.
18. Motor Insurers’ Bureau, “Check your vehicle insurance status”, https://www.mib.org.uk/check-and-stay-insured/check-your-vehicle/. Accessed 13 October 2026.
19. Motor Insurers’ Bureau, “askMID”, https://www.askmid.com/ (replatforming notice). Accessed 13 October 2026.
20. Financial Ombudsman Service, “Decision DRN-5614078”, https://www.financial-ombudsman.org.uk/decision/DRN-5614078.pdf, 2025. Accessed 13 October 2026.
21. GOV.UK, “Riding an electric bike: the rules”, https://www.gov.uk/electric-bike-rules. Accessed 13 October 2026.
22. nidirect, “Electric bikes (electrically-assisted pedal cycles)”, https://www.nidirect.gov.uk/articles/electric-bikes-electrically-assisted-pedal-cycles. Accessed 13 October 2026.

This article is intended as generic information only and is not intended to apply to anybody’s specific circumstances, demands or needs. The views expressed are not intended to provide any financial service or to give any recommendation or advice. Products and services are only mentioned for illustrative rather than promotional purposes.