Transportation is probably one industry that will never go out of business. It is constantly evolving, from taxis to limousines to the newly-popular rideshare services. People are always going to need to get from one place to another. It’s just how the world works. But with this hot commodity come the chances for a lot of car accidents. Spending so much time on the road, transportation vehicles face a lot of threats every day. The best way to go about addressing these risks is to purchase livery insurance. Livery insurance provides coverage for your transportation business. It protects drivers, customers, and vehicles. It is vital insurance you never want to send your employees or yourself on the road without.
What is Livery Insurance?
Livery insurance, also commonly known as for-hire livery insurance, is a type of commercial auto insurance designed to provide coverage for companies that make their income by transporting people from one place to another. This insurance can encompass both scheduled transportation (ex. Limos) and public-hire vehicles (ex. Taxis). It covers your business, drivers, and any clients in the vehicle at the time of an accident.
What is a Livery Vehicle?
A livery vehicle is any type of vehicle that a business uses in order to transport people. Pretty much anything can be declared a livery vehicle so long as it is being used to generate income by providing rides. Some common livery vehicles include:
- Buses (sometimes)
- Personal cars (sedans, SUVs, etc.)
Do You Need Livery Coverage?
If you or your business transport people in any capacity, yes, you need livery insurance coverage. Not only is it law in nearly every state that drivers need to carry insurance, but it also protects your business assets. Failure to carry livery insurance can result in you having to pay for any damage and injuries out of pocket. One accident is enough to put a serious dent in your business’s finances. Insurance can also help with legal fees should you be sued following the collision. Letting your vehicles or drivers hit the road without the proper coverage is incredibly irresponsible and not a recommended business practice.
Types of Livery Insurance
Livery insurance encompasses a number of different types of coverages. It is pretty much an umbrella term with a variety of vehicles listed under it. There are four main types of vehicles a livery policy covers. The most common types of livery coverage are outlined below. Make sure you check with your state insurance regulations before purchasing a policy to assure you are staying within the law. Failure to carry auto insurance in any capacity can be detrimental to your for-hire business.
If you own a taxi business, you need taxi insurance. This insurance provides coverage for drivers, vehicles, and any passengers they are transporting. States have their own rules and regulations regarding taxi services and the insurance they need. If establishing one, do your research first prior to purchasing an insurance policy. Driving a cab is a risky profession meaning your insurance coverage has to be adequate. The proper taxi insurance policy will include coverage for any damage to your vehicle and personal injury to you and your customer(s).
Another sub-genre of livery coverage includes black car and limousine insurance. This is a special type of insurance coverage designed to protect limos and any other expensive vehicles a business uses to transport people. This insurance typically differs from taxi insurance since limos are an arranged service, whereas taxis can be hailed off the street. Limousine insurance must cover both the costs to repair the vehicles and any personal injury expenses.
Rideshare services are on the rise in popularity, and if you are hopping on the trend, you are going to need a livery insurance policy to make sure you are properly protected. Any drivers who use their personal vehicles to drive for companies such as Uber or Lyft need special coverage beyond their personal auto insurance. Livery insurance is key as it will help to give you the best rideshare insurance coverage as a business operator. Even if you are working for another business, you are still using your own vehicle and any business insurance assistance.
Non-emergency Medical Transportation (NEMT) Insurance
A non-emergency medical transportation (NEMT) business is a transportation company that helps elderly and disabled patients get to appointments or from hospital to hospital. This is reserved for people who cannot use public transportation or personal vehicles to transport themselves. Insurance requirements for these types of vehicles are typically regulated by states. Mandates vary based on location. This type of business also has the additional risk of injury to your clients due to their age or disabilities. Harm can happen to them during transport or while taking patients on and off the vehicle. Insurance coverage needs to be expanded to cover such instances.
Charter Bus/Motor Coach Insurance
Transporting people via a charter bus, motor coach, or even a tour bus can be considered a for-hire livery service, and you will need this specialized type of commercial auto insurance. You need to make sure your vehicles, passengers, and drivers are covered by insurance in the event of an accident. Keep in mind that your insurance rates can be higher due to the size of your vehicles and how many people you are transporting. Check with local regulations regarding bus services and insurance prior to purchasing a livery insurance policy.
Coverage Available For Livery Drivers
Coverage provided by livery insurance is not too different than what you would find from a personal car insurance policy. Where it can differ is the coverage limits and a focus on protecting clients in the car, not just drivers. Livery insurance offers the following coverage:
- Liability Insurance - Liability insurance covers bodily injuries and property damage that you cause in a collision. It pays for the other party’s repairs and medical expenses if you have been found to be at fault. It can also help with legal fees should you be sued by the other driver.
- Collision - Collision coverage pays for damage to your vehicle following an accident, no matter who was at fault.
- Comprehensive - Comprehensive insurance covers damage to your vehicle after a non-collision-related incident. The most common examples are vandalism, theft, and weather damage. Comprehensive can even cover damage to your vehicle that is done by your passenger(s).
- Uninsured/Underinsured Motorist Coverage - Despite insurance being required in nearly every state, many still choose to drive without it. If you end up in an accident with a driver lacking liability insurance, uninsured/underinsured motorist coverage can help get your auto repairs and medical expenses paid for.
How Much Does Livery Coverage Cost?
A livery insurance policy can be costly for your business. Livery coverage is usually regulated by cities so the cost for a policy can vary based on where you live; on average, you can expect to pay somewhere from $5,000 to $10,000 annually for coverage. The quote you actually receive depends on a number of factors. Like any other kind of insurance, livery coverage premiums are determined by information gathered about you, your vehicles, your employees, and your business. The cost of insurance coverage depends on the following:
- Location - Some states have higher insurance rates than others. Something as simple as your zip code will greatly impact your insurance premiums. If you also operate in multiple states, you can expect to pay more for coverage.
- Driving record - Both you and your driver(s) driving records will come into question when establishing insurance rates. If you or anyone with your business has a less-than-favorable driving history, expect to see higher premiums.
- Usage - The industry you are in and what you subsequently use your vehicle(s) for will impact your insurance premiums. Non-Emergency Medical Vehicle Insurance is going to cost more compared to someone who is in the limousine business. Making long trips can also affect your insurance rates.
- Type of vehicles - Regular commercial sedans, like those used by many taxi companies, will be less to insure than something extravagant like a stretch limo. The number of vehicles your business uses will also affect your rates. You will pay more for insurance if you have a whole fleet of vehicles needing coverage.
- Coverage limits - How much insurance coverage you need will impact your rates. The more insurance you need, the higher your premiums will be. Your insurance deductible will also affect how much you pay annually for coverage. The lower you set your deductible, the more you will be paying.
Livery Insurance vs. Personal Auto Insurance
It is possible that your personal car insurance policy will cover the expenses following an accident in a vehicle you use for transporting people. However, you can get into some trouble if your insurance provider finds out you have used your vehicle as a taxi or rideshare service and have not purchased livery coverage. If you lack the proper commercial insurance, they may consider your insurance claim to be a fraud and deny paying for auto repairs or medical expenses, even if your insurance policy limits are high enough to cover everything. It is better to be on the safe side and purchase a commercial insurance policy to cover your business ventures.
Get a Livery Insurance Quote Today
Looking for a livery insurance policy? Call us today to get a free livery insurance quote. Make sure you let us know your zip code, details of your business, and information on your vehicle(s). By providing us with all this, we can get a better idea of the coverage you need. You can get a quote either at one of our many locations or online via our website and mobile app. You can also start your quote over the phone. Get commercial coverage today and drive worry-free tomorrow.