What is hire and reward insurance?

Hire and reward (H&R) insurance goes by many names, including courier insurance and carriage of goods insurance.

It is a type of commercial car insurance that allows drivers to transport goods (like Amazon parcels or takeaway food) or passengers in exchange for payment.

Hire and reward insurance is a legal requirement if you want to work as a courier, a private hire taxi driver, or a food delivery driver.

This insurance will protect you from any risks associated with carrying passengers or goods, like causing damage to what (or who) you’re transporting and members of the public.

Note: Hire and reward insurance will cover your vehicle, but not the goods you’re transporting. You will need a separate “goods in transit” insurance policy.

What are the features of hire and reward insurance?

Here are some key features of H&R insurance:

• It’s a legal requirement: You legally need H&R insurance if you wish to transport passengers (like a private taxi driver) or goods, or if you hire out your car. Without the right policy in place, you can face fines, points on your licence, and possibly even a suspension of your operations.
• Covers the vehicle: This type of insurance will cover the vehicle used for commercial purposes (although the exact events covered will depend on the level of cover).
• Public liability insurance: H&R insurance commonly includes public liability cover, which protects you if a member of the public makes a claim against you due to damage or injury you caused.
• Opt for goods in transit cover: This type of cover is not always included but will be a good idea as it protects the products you’re transporting from theft or damage.

Which levels of cover are available?

As with standard car insurance, you can get the following levels of cover for your hire and reward insurance policy:

• Third-party only (TPO) – This is the minimum legal requirement in the UK. It covers you if you injure a third party or cause damage to their property. Neither you nor your vehicle will be covered if you’re at fault.
• Third-party, fire and theft (TPFT) – It includes TPO and protects your vehicle if it is damaged by fire or is stolen.
• Comprehensive cover – Includes TPFT as well as additional cover for damage to your own vehicle, personal injuries, medical expenses, legal expenses, and breakdowns.

Who needs hire and reward insurance?

This depends on the type of business you’re in. If you transport people or goods in exchange for money, you’ll need hire and reward insurance.

If you don’t have hire and reward insurance when doing this kind of job, you won’t be covered if you suffer losses or cause damage to a member of the public. Not to mention, it’s illegal to continue business operations without H&R insurance.

The following people usually require hire and reward insurance:

• Taxi drivers (especially private hire taxi drivers)
• Chauffeurs
• Uber drivers
• Food delivery drivers
• Parcel delivery drivers (e.g. Amazon drivers)
• Furniture removers
• Vehicle transportation companies
• Haulage or freight companies

Which types of vehicles are covered by hire and reward insurance?

Hire and reward insurance covers the following vehicles:

• Motor car
• Van (although check your policy as you might need van insurance)
• Motorbikes
• Scooters

Each insurer will have different prices, but you can expect to pay on average:

• Pay-as-you-go insurance – £0.80 per hour
• Monthly insurance policies – £110 – £130 per month
• Annual insurance policy – £1,100 per year

Which factors influence the cost of H&R insurance?

Each hire and reward policy is different, but insurers consider the following when determining the cost:

• Driver’s age and experience
• Annual mileage
• Type and value of the vehicle
• Which goods you carry
• Location where you drive and park
• Hours of work