Hire and Reward Insurance
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Hire and reward insurance: Compare insurance quotes for cars, vans, motorbikes and lorries with Quotezone.co.uk
Working out what insurance you need when you transport goods and passengers for a living can be confusing. But it’s vital to have the right kind of cover to ensure your courier vehicle, passengers and your delivery merchandise are protected – here’s what to consider.
What is hire and reward insurance?
Hire and reward insurance, sometimes referred to as ‘class 3 business insurance’ or ‘carriage of goods for hire and reward’ is a type of courier insurance. It’s a specific type of insurance that covers you if you transport items or make a number of deliveries to different people within a particular area – for instance if you’re a furniture remover or courier.
Hire and reward delivery insurance isn’t the same as haulage insurance although it’s easy to confuse the two. Haulage insurance is only suitable if you’re covering long distances making one or two deliveries, like HGV drivers travelling across the UK or Europe.
With trends showing the demand for various forms of delivery drivers continuing to increase in the wake of the pandemic, thousands of motorists across the UK are seeking to cash in on the trend. With all these additional drivers looking to make a side hustle out of delivering merchandise and passengers, there is naturally an increase in invalid insurance claims.
The reason for this is that unfortunately many drivers assume their standard vehicle insurance for day to day driving is sufficient coverage for making deliveries for payment. These drivers are stung by insurance invalidations when their vehicles are damaged or cause damage in the event of an accident due to not disclosing their new part-time job.
Many drivers do not realise that their current insurance policy will only cover them for personal use and not business related activities, leaving them uninsured in the event of an accident. Due to this it is paramount that you secure the correct insurance before getting behind the wheel for any business related activities.
What does hire and reward insurance cover?
If you have a fully-comprehensive hire and reward insurance policy then both third parties and your own delivery vehicle would be covered if you’re ever involved in an at-fault accident. Given the busy nature of a delivery drivers job, it is unfortunately never a guarantee that you will not accidently cause damage to other road users. Even the best drivers can find themselves making mistakes and sometimes luck isn’t on side. Due to this is is recommended that delivery drivers opt for as comprehensive a policy as is affordable, as this will increase your protection and mean you won’t be left out of pocket should you cause an accident.
The levels of cover for a hire and reward policy typically include the following:
- Third-party – Coverage against damages you cause to other drivers.
- Third-party, fire & theft – Coverage against damages you cause to other drivers as well as cover against fire damage and theft to your vehicle.
- Comprehensive – Coverage for your own vehicle as well as third party vehicles in the event of an at fault accident, fire and theft coverage is also typically included in this policy.
Some insurers will allow you to include ‘goods in transit cover’ as part of your hire and reward insurance policy, which means the goods you’re transporting would be covered from loss or damage also.
Insurers do set their own policy features and exclusions however, so when you compare policies it’s crucial to check terms and conditions so that you’re clear about what is and isn’t covered. Price comparison platforms such as Quotezone.co.uk can help you compare a variety of policies from across the UK market in moments. This increases your chances of finding the right policy for you with all the coverage and add-ons you may require.
Does hire and reward insurance cover food delivery?
In short the answer is yes, since you will be making food deliveries for payment this brings it under the criteria for hire and reward insurance. If you are planning on becoming a food delivery driver in the UK you will need to have some form of specialised coverage for the time you are making deliveries. This coverage will need to specifically insure deliveries and cannot just simply be your standard insurance policy which you use for your regular day to day driving. With this said you’ll also need to retain your standard insurance policy for when you aren’t making deliveries, this is to cover you for when you are driving whilst not working. Like with all road vehicles in the UK, this will need to be a minimum of third-party coverage to meet the legal requirements.
However, remember that insurers set their own terms and conditions so it’s a good idea to double check that fast food or takeaway delivery is covered under their specific hire and reward policy. Some providers don’t automatically cover food deliveries which could be down to the perceived increased risk of driving, mainly at night.
If you’re in any doubt over a hire and reward policy will offer you the necessary protection, it’s always best to ask the insurer just to be on the safe side.
Must I have hire and reward delivery insurance by law?
Yes, you’ll need some form of hire and reward, courier insurance or food delivery insurance before you start making deliveries, because a regular, run-of-the-mill insurance policy won’t cover you while you’re delivering goods. This is due to the nature of the role and the inherent risks involved with making deliveries for payment. Due to this, insurers will require that a driver takes out a specialised form of insurance to cover their food deliveries during the time they are working. Insurers will not accept any claims made for accidents that occur whilst you are making deliveries under your standard day to day insurance policy.
In fact, if you begin making deliveries on a ‘hire and reward’ basis and you only have a standard insurance policy that policy could be invalidated. Further, if you are pulled over by police making deliveries on the wrong insurance policy, you can face six penalty points on your license as well as up to £300 in fines.
Are there other types of hire and reward besides car hire and reward insurance?
Yes, although car hire and reward insurance is one of the most popular types, you can take out this type of policy for other vehicles too. Motorbike couriers can take out motorbike hire and reward insurance, for instance, while delivery drivers who use a van can take out van hire and reward insurance. Essentially the vehicle you use will not change the type of insurance coverage you need but it will impact your risk profile with the insurer. For example an electric van would be more costly to repair than a standard delivery scooter, so you can expect to pay more for a hire and reward policy covering an electric van.
What our experts say:
“There could be thousands of delivery drivers working across the UK without realising their insurance is not valid. With the cost-of-living soaring, millions of people are taking a hard look at their finances and seeking additional ways to earn a little extra cash” – Greg Wilson, Founder of Quotezone.co.uk.
How much does hire and reward insurance cost?
Premiums for hire and reward insurance will vary depending on a number of factors. Some of these factors you will have more influence over than others. However it is important to remember the best strategy for finding the cheapest hire and reward insurance is to compare multiple quotes, regardless of your insurance risk factors. Some of the more common factors that can influence the cost of your reward insurance include the following:
- The overall policy you choose and any other features it includes, for example: a comprehensive policy including hire and reward plus a courtesy van is likely to cost more than a policy offering just third party only cover plus hire and reward.
- Whether you’ve made an insurance claim in the last five years, a recent claim can push up your premiums as you’ll naturally be viewed as a higher risk to insure due to the previous claim.
- The nature of your job and the types of goods you’re delivering or transporting.
- The type of vehicle you own – the larger or more powerful it is, the more you can expect to pay.
When it comes to comparing quotes, it’s vital that any policy you choose covers your needs. If it doesn’t, you could find yourself footing the bill for expensive repairs and covering the cost of damaged goods.
While price is undoubtedly an important part of choosing a policy, it shouldn’t necessarily be the overriding factor when you’re trying to compare hire and reward insurance. Cheaper policies may have more exclusions or limitations which could mean you need to add on the protection you need – increasing the cost.
On the other hand, more expensive policies might already include everything you need, in which case, they could represent better value for money.
*Idling your vehicle while making a drop off is a mistake many new delivery drivers make when they hit the road. This is damaging to the environment and health of those living in the area. It can also lead to fines should you be caught by law enforcement.
What do I need to do to get hire and reward insurance?
As with other forms of insurance, you will need to enter some basic details about yourself, your delivery vehicle and the type of cover you wish to take out. This can be done in a few moments and will give you a wide variety of policies, removing the need to manually search between individual provider sites.
You should also ensure that all the relevant information given on your policy is up to date and correct. Failing to provide this could lead to your insurance being made invalid when you need to make a claim, leaving you out of pocket. Always check the documentation of a policy before buying to ensure you are getting the correct level of coverage for your needs.
Is taxi insurance the same as hire and reward insurance?
Hire and reward can offer relevant coverage for those who drive pre-booked passengers for payment as private hire taxis. Hire and reward insurance is sometimes referred to as private taxi hire insurance. Essentially these insurance polices take into consideration the unique risks of operating a private hire taxi and transporting passengers. As with other forms of hire for payment work, taxi drivers require a specialised insurance coverage that standard car or van insurance simply won’t meet. This is once again due to the fact that insurers will differentiate between driving for reward and driving for personal use. Because of this insurers will require taxi drivers to be under a specialised policy in order to be covered. A reward and hire insurance policy will cover you for the following should you be involved in an accident:
- Damage to third party vehicles
- Legal expenses
- Injury cover
- Public liability
- Damage to your Taxi (Depending on level of coverage)
The best way to make sure you have the cheapest insurance policy for your taxi is to compare multiple insurers and not let your policy auto-renew when possible. By allowing for auto-renewals you may be missing out on cheaper alternatives on the market and so limiting your savings potential.