What is Livery Insurance?
Livery insurance is an auto insurance policy specifically designed for businesses that make a living by transporting passengers around.
In Illinois, for instance, any livery operator has to keep at least $350,000 in liability coverage. By law in the Illinois Administrative Code, Title 92 states that minimum requirement for livery services.
Meanwhile, over in Texas, for-hire vehicles have to have at least $500,000 in liability coverage, according to the Texas transportation code Chapter 643.
The big insurance companies that write livery policies include Progressive Commercial, National Interstate and GEICO Commercial, plus some specialist insurers.
Companies like State Farm and Allstate don't offer livery insurance as a standard part of their auto policies, for-hire use is explicitly excluded. If you want to follow law and operate your business properly you'll need a dedicated livery policy.
Types of Livery Insurance
Taxi Insurance
Chicago taxi operators are required to prove their insurance coverage to the City of Chicago Department of Business Affairs and Consumer Protection. The city demands that taxi operators have a minimum of $350,000 in combined single limit liability coverage.
Carriers who write policies for Chicago taxis include Progressive Commercial, National Interstate, and American Access Casualty. If you've got a fleet of 5+ vehicles, you might qualify for a fleet discount of between 10 & 15%.
Limousine Insurance
In Illinois, limo and black car operators need to have $1 million in liability coverage if the vehicle can seat 8-15 people. That's a state requirement set out by ICC regulations. As for the actual cost of insuring a Lincoln MKT or a Cadillac Escalade ESV, that can range from $8,000 to $12,000 a year.
If you've got a stretch limousine or a party bus that can carry a lot of people, then you're going to need to have insurance that covers 1.5 million to $5 million. This can increase the cost up to $15,000-$25,000 a vehicle per year. Companies that specialize in limo coverage include Lancer Insurance, National Interstate, and APCIA members.
Rideshare Insurance
Uber and Lyft only offer contingent liability coverage while you're logged in to their app with a passenger. However, as soon as you turn your app off, you're only covered up to $50,000 per person for bodily injury.
That's why you really need to get gap coverage through a rideshare endorsement from a carrier like Progressive, Allstate or GEICO.
This can cost anywhere from $15-$30 a month and is usually tacked on to your existing personal policy. If you're driving for Uber or Lyft fulltime and logging 30+ hours per week, then you should probably consider a commercial livery policy to keep you covered.
Non-emergency Medical Transportation (NEMT) Insurance
Non-emergency medical transportation operators in Illinois need to get registered with the Illinois Department of Healthcare and Family Services and have a minimum of $1 million in liability coverage. If you've got a vehicle with a wheelchair lift, then you'll also need additional hired and non-owned auto coverage. Some carriers that write NEMT policies include National Interstate, Philadelphia Insurance Companies, and Protective Insurance Company. As for Medicaid-contracted NEMT providers, they've got to comply with a whole heap of extra rules set out in 89 Ill. Adm. Code 140.490.
Charter Bus or Motor Coach Insurance
Interstate charter bus and motor coach operators are subject to FMCSA jurisdiction and as such are required to have at least a $5 million liability insurance policy under the rules outlined in 49 CFR 387.33. Here in Illinois though, if you are just doing local trips then you'll need to have at least a $1.5 million policy as per the rules set out by ICC.
The list of insurance companies writing motor coach policies includes names like Lancer Insurance, National Interstate and also Great American Insurance Group. Insuring a 56-passenger motor coach will cost you anywhere from $12,000 to $20,000 every year.
Coverages Available For Livery Drivers
Livery insurance offers the following coverage listed below.
Liability Insurance
Liability insurance covers bodily injuries and property damage you cause in a collision. If you are at fault, it pays for the other party’s repairs and medical expenses. It can also help with legal fees should the other driver sue you.
To operate a livery service in Illinois you are going to have to have a minimum of $350,000 CSL liability coverage. If you hold a Chicago taxi medallion then you are also going to need to file form IL 444-2790, this is the form the city requires to show proof of insurance.
Collision Insurance
Collision insurance coverage pays for damage to your vehicle following an accident, no matter who was at fault.
For livery companies, Collision coverage is especially important because of those high daily mileage numbers. When it comes to deductibles, you're generally looking at around $500 to $2,500 with commercial livery policies.
Comprehensive Insurance
Comprehensive covers all the things that can go wrong including theft, vandalism, weather damage and so on. For a limo operator, that includes damage to all the nice extras like leather seats, entertainment systems and partition glass.
Uninsured/Underinsured Motorist Coverage
In Illinois, your car insurance policy must include Uninsured and Underinsured motorist coverage which will match your liability limits, unless you opt out in writing.
Given the fact that in Illinois over 12.6% of drivers are uninsured according to the Insurance Research Council, it would be a good idea to look into keeping your UM/UIM limits at their fullest.
How Much Does Livery Insurance Coverage Cost?
Livery insurance premiums can vary wildly, ranging from $4,000 to $12,000 per vehicle per year. This depends on the type of vehicle you've got and which state you're in.
If you're a taxi or black cab operator in Chicago, for example, you're likely looking at an average of $6,000 to $9,000 a year per vehicle.
Limousine operators tend to face even higher premiums, around $8,000 to $15,000 per vehicle per year. This is largely because they need such high liability limits and are usually driving really expensive vehicles.
NEMT operators who transport wheelchair passengers are also in a higher risk tier, with premiums running from $7,000 to $14,000 annually.
The cost of livery insurance coverage depends on the following:
Location - Some states have higher insurance rates than others.
Driving record - Both you and your driver(s) driving records will come into question when establishing insurance rates.
Type of vehicles - Regular commercial sedans, like those used by many taxi companies, will be less expensive to insure than something extravagant like a stretch limo.
Coverage limits - How much insurance coverage you need will impact your rates. The more insurance you need, the higher your premiums will be.
Get a Livery Insurance Quote Today
Insurance Navy is one agency that writes livery policies, through carriers like Progressive Commercial, National Interstate and Canal Insurance Company.
To get a quote, you'll need your Illinois Secretary of State vehicle registration and your operating authority number. If you've had livery insurance in the past, your new insurer will want to look at your insurance record from the last 3 years.
Want to get a quote in person? Give us a call at 1-888-949-6289 or stop by any one of our locations in Chicago, Houston, Dallas or Indianapolis. We can usually get you a quote same-day. Most of our policies can be issued within 24 to 48 hours.