The first part of getting a private hire driver job in London is selecting a suitable car and joining a driving platform, but the process doesn’t stop there. Among the most crucial areas to comprehend are PCO car insurance. When you’re in a position to hire passengers for fare or reward and you’re driving an Uber, Bolt or other licensed private hire company, you will require the proper insurance for this. Private hire is not just about ordinary social, domestic and commuting cover. New drivers might find insurance also confusing as they can be covered through a PCO car hire package or taken on a separate basis, depending on the vehicle and the deal. This guide covers the basics of PCO insurance, what this type of insurance covers, what new drivers need to know, and how insurance plays into the cost of running a private hire car.
PCO car insurance, what is it?
PCO car insurance is specialist motor insurance coverage for private hire. Private hire vehicles are required to be licensed in London and all PHV vehicles should have hire and reward insurance. All vehicles need to be insured under hire and reward insurance as a licensed vehicle and when used as a private hire vehicle, TfL says. It is not the same as regular auto insurance coverage. Personal driving, commuting or other uses approved by the motor policy may be covered. It does not automatically allow you to carry paying passengers. The bottom line for Uber/ Bolt drivers is:
Your insurance should cover you to hire the car for private hire and also people to travel with you for a fare. If not covered properly, you may have serious financial and licensing issues.
What makes PCO drivers require special insurance?
Private Hire driving provides more exposure on the road than many other personal trips. It can be several hours of driving a day to pick up passengers, transport to jobsites, and in peak hours. Private hire usage is treated differently by insurers to the way in which it is treated when using a car as a personal vehicle.
This kind of commercial driving is what PCO insurance is based on.
It is especially vital to:
- Uber drivers
- Bolt drivers
- Private hire drivers
- This represents the new PCO licence holders.
- Full-time ride-hailing drivers
Part-time drivers who work as private hire drivers.Part-time private hire drivers. Additionally, TfL has powers to inspect insurance documentation, and they serve as enforcement. The insurance documents being missing when requested is one of the areas of private hire non-compliance mentioned in its compliance guidance. Insurance isn’t just another cost. It is a legal and responsible way to operate.
What is typically covered by PCO insurance?
Actual coverage will vary based upon your insurance policy and coverage terms. So never presume that two policies offer the same level of coverage. Typically, the damage to your own car is included in an extensive PCO policy along with third party claims and other car insurance covered risks, subject to the conditions, exclusions and excess of the policy. The key point for a new driver, however, is to make sure that that particular policy covers the private hire element of driving for hire/reward.
The most complete form of PCO insurance.
Private hire drivers may opt for full cover insurance which may offer more comprehensive coverage than third party only.
But comprehensive isn’t comprehensive — there are situations that aren’t covered.
Always to check:
- Drivers who are covered by insurance.Insured drivers.
- What can be done for a private hire use.
- The policy excess
- Whether claims relating to passengers, including where they are based, are covered.
- Any exclusions
- Where the vehicle can be driven
- Does it have any mileage limitations
- After an accident, what should be done?
- Does the policy continue to be valid on the platform you want to use?
The term “comprehensive” is not sufficient to designate a policy.
Does PCO insurance come with car hire?
This will depend on the provider and the agreement that is selected.
Primal Cars currently says that their PCO car hire packages will cover fully comprehensive insurance as well as PCO licensing, servicing and maintenance, road tax, MOT and 24/7 breakdown cover. The Rent to Own information also includes full comprehensive insurance in the plan, servicing, maintenance, road tax (6-monthly) and MOT and 24/7 breakdown cover. This can simplify the budgeting process for drivers as several key aspects of vehicle expenses are consolidated in a single contract. However, do read the agreement before entering into an agreement. Inquire specifically about the cost of the weekly payment and if there are extra insurance conditions or expenses.
PCO insurance and TfL licensing
Being a compliant London private hire driver is no simple matter as insurance is just one element. TfL have individual licences for private hire drivers, vehicles and operators. TfL says that for drivers, applicants need to be above age 18, have a valid driver’s licence, have the right to work, a DBS check and medical fitness. The car must also comply with the private hire regulations. This is significant because driver licensing is different from vehicle licensing. A driver may have a valid PCO driver licence and require a well-licensed and insured PHV. Prior to starting work, ensure that:
- Your private hire driver licence is valid.
- The vehicle has the necessary PHV licence.
- There is an insurance policy for private hire.
- The vehicle is compliant with the appropriate TfL requirements.
- Your ride hailing platform has accepted the necessary documents.
- These measures can help avoid unnecessary delays.
What is the price of PCO insurance?
No one PCO insurance price fits all drivers.
The premiums may differ according to:
- Driver age
- Driving experience
- Claims history
- Licence history
- Vehicle type
- Location
- Intended use
- Annual mileage
- Policy excess
- Level of cover
A more experienced private hire driver may therefore be able to offer you a different quote, if you are a new driver. That’s why it’s more helpful to examine the total weekly driving expense than just the insurance amount. For example, consider: Cost of the vehicle, insurance, charging/fuel, maintenance, road charges, other costs per week. A less costly vehicle may cost more if it’s more expensive to run, or has additional maintenance expenses.
Renting a PCO car can simplify insurance
Buying a car and arranging private hire insurance yourself can create several upfront costs.
You may need to consider:
- Vehicle purchase
- Insurance
- PHV licensing
- MOT
- Servicing
- Road tax
- Repairs
- Breakdown cover
PCO car hire can simplify this structure.
Primal Cars states that its PCO-ready plans bring together vehicle rental with key inclusions such as fully comprehensive insurance, servicing and maintenance, road tax, MOT and 24/7 breakdown assistance. For a new driver, this can reduce the amount of vehicle administration needed before getting on the road. It also makes weekly budgeting easier because you can understand the main fixed vehicle costs before calculating your expected driving income.
Rent to Own vs Car Finance – Traditional.Rent to Own vs traditional car finance
There are those who wish for flexibility in the beginning of their private hire career. Others want to work towards ownership. This is where Rent to Own can come into play. In the traditional financial system, you typically take out a loan for a vehicle, and then make payments on the loan over a period of time. A Rent to Own contract is a different story. Under the contract you pay regular installments to become owner of the property. Primal Cars has Rent to Own plans for PCO drivers and calls it a “flexible payment path to owning a car”.
Which one of the following is more effective?
There is no single solution.
PCO hire might be the right choice for you if:
- This is your first time working for private hire clients.
- You want flexibility.
- You don’t want to get a big car in the beginning.
You would like all important car expenses to be in one package.
Rent to Own can be of benefit to you when:
- The car will last you several years.
- Vehicle ownership is a long term goal.
- You want to work towards owning the car.
- You want to receive a consistent income from an arranged agreement.
Compare the full agreement, rather than the weekly amount.
Electric, PCO or hybrid PCO car – which is better?
The correct one is going to rely on the way you drive. For those who drive a lot, and have good access to proper charging stations, electric PCO cars may be an appealing choice. Electrics and plug-in hybrid vehicles are available in all the vehicles currently in Primal Cars’ lineup, including the Kia Niro EV2, Toyota bZ4X, Kia EV6 and several electric versions of the Mercedes. Another solution is hybrid and plug-in hybrid vehicles that can help those looking to reduce their fuel consumption but still drive a little further.
When looking at an EV vs hybrid, think about:
- The average number of miles you drive every day.
- Access to charging
- Charging time
- Electricity costs
- Fuel costs
- Passenger requirements
- Vehicle range
- Your preferred Uber and private hire type of service.
- London road charges
Never select an electric or hybrid car just because it is electric or hybrid. Select the vehicle’s transmission system for use that matches the actual mode of operation.
Earnings example for a new PCO driver
Suppose there is a new driver who drives five days a week.
They should NOT work out their earnings as:
Profit = all the money that is earned from the sale of a ticket minus the cost of a car’s weekly payment.
1.This doesn’t include the relevant expenses
However, a more realistic calculation takes into account:
Gross driving income
minus:
- The expenses of owning or renting a vehicle.
- Insurance, if separate
- Fuel or charging
- Road charges – congestion or other charges that may apply.
- Parking
- A fee or commission charged by the platform for using its services.
- Cleaning
- Other work-related costs
The other number provides a clearer indication of your operating position.
It is a way to avoid the frequent error people make of assuming they will make money if they have a busy week.
Some of the common mistakes that new drivers make when it comes to PCO insurance
- Assuming that normal car insurance is sufficient
Private hire driving should have the correct hire and reward insurance. Don’t assume anything!
When selecting a policy, only opt for the cheapest one.
The lowest priced premium might not give you the coverage you need.
- Ignoring the excess
Sometimes, a low premium can be accompanied with a higher excess. Know what you could have to pay following a claim.
- Not monitoring your insurance coverage.
Your policy may change as a result of a change in circumstances. Notify your insurance company if there are pertinent changes and adhere to the policy.
- Not checking vehicle eligibility
The insurance, vehicle and private hire requirements must be integrated.
Not maintaining records.
The TfL compliance officers have the right to request insurance documentation. Maintain up-to-date and easily accessible records.
Situational: You are a new Uber driver.Real life scenario: You are a new Uber driver.
Think of a driver who has just been issued with their London private hire driver’s licence. They need to get on the road as soon as possible, but they don’t have much experience in controlling a commercial vehicle’s costs. Purchasing a car, arranging insurance, sorting out the MOT, road tax and even maintenance may mean a range of separate tasks. Rather they should look at a PCO rental package that takes care of some of the components that are essential in the deal. Primal Cars states that its cars come PCO ready and that packages may contain insurance, servicing, road tax and MOT and breakdown assistance. The driver may then concentrate more on acquiring the platform and gaining a better understanding of the demand in London and develop a more efficient working routine.
Where Primal Cars fits in
Primal Cars has been around since 2013 and specialises in car hire and Rent to Own solutions for PCO Drivers in London. It offers today, PCO ready cars, electric vehicles, plug-in hybrids and executive models. The company also offers flexible rentals and quotes full comprehensive insurance, servicing and maintenance, road tax as well as MOT and 24/7 breakdown assistance under the corresponding plans. A driver who is looking at options will find the biggest advantage isn’t actually just being able to get their hands on a car. Understanding what is covered in the arrangement as a whole.
Transparency is important when it comes to managing weekly private hire earnings
Before you decide to hire or Rent to Own a PCO, check out the specific vehicle, weekly charges, insurance and contract details. Useful checklist before you start up your PCO driving. Before taking on your first private hire job, please ensure that you inspect the following:
- Your private hire driver licence from TfL is in good order.
- You own a car with the appropriate PHV licence.
- Your insurance company allows hire and reward.
- You know what the insurance excess is.
- You understand what you’re paying for each week on your vehicle loan.
- You have a current MOT and Licence.
- You know what to do to support yourself when you break down.
Fuel/Charging costs have been estimated.You’ve thought about the charges for driving in London.You’re aware of the conditions of your rental or Rent to Own contract.Taking a few minutes to check can save costly issues down the road.
Closing remarks
Understanding how PCO car insurance works should be a part of the basic knowledge that every London private hire driver gains from day one.The basic rule here is easy – you need the correct insurance to match your driving habits.Insurance cannot be considered separately; it should be taken into account along with the vehicle payment, licensing, repairs, MOT test, car tax, refueling/fuel charges and other expenses. While for some drivers PCO car hire will be an obvious choice, for others Rent to Own may become a way to achieve vehicle ownership.The ideal solution for each of you depends on your driving plans, budget and driving miles.When choosing between PCO car hire or Rent to Own, Primal Cars can offer all necessary information about its current fleet and plans packages in order for you to base your decision not on weekly price but on overall cost.
FAQs
1.Insurance requirements when driving with Uber in London?
Yes. In the event that you are taking people as a driver of private hire transport, then you will require insurance for hire and reward purposes.
2.Does PCO Insurance Cover Primal Cars?
It is noted that the insurance coverage included in the Primal Car plans includes full comprehensive insurance cover. This can be seen from the information provided for Primal Car’s Rent to Own package.
3.Is insurance possible for new PCO drivers?
Yes, but whether they can get insured or not depends on their situation. There could be many aspects to consider, such as age and experience.
4.Are comprehensive insurance and PCO insurance the same thing?
No. The term “comprehensive” relates to the coverage itself, whereas PCO insurance relates to how the car can be used.
5.Is there any insurance in PCO car rental?
In some PCO rentals, insurance is included, but there are some where one needs to get insurance on their own. According to Primal Cars, some of the PCO schemes they have include comprehensive insurance as well as other vehicle inclusions.
