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Courier insurance explained

In the new Gig economy, it is the couriers who have an ever growing opportunity for steady employment. To operate this on-demand service is the requirement of having courier insurance to protect the driver, the vehicle and the packages from any type of mishap.

Do I need courier insurance?

To legally operate as a courier or delivery person for profit, courier insurance is required by UK law. This is classified as one form of hire and reward insurance. If a courier does not have this type of policy and is making deliveries with a regular social, domestic and pleasure private vehicle policy, any claim made from an accident while working will not be honoured.

What is courier insurance?

This is a commercial vehicle insurance policy that covers the vehicle and activities of a person who is being paid by a third party to deliver packages.

  • Road risk coverage can be full comprehensive or third party only.
  • Goods in transit is optional insurance to protect the packages being delivered.
  • Public liability will be protection if there is a claim made against the courier by a member of the public stating they have been harmed or their property damaged.

Is courier and haulage insurance the same?

The difference between a courier policy and one classified as haulage is the number of destination or stops on the couriers route. A typical courier will have multiple stops on their route each time they depart with packages. A person hauling a load generally only has one destination where they off-load the contents of their vehicle.

What is the average price of courier insurance?

The annual cost of courier insurance has many factors that are considered into the price of it. For a good driver with no points on their driving licence and use a small, economical vehicle, the annual premium can be as low as £800. The costs are determined by the risk the vehicle, the driver and the area of coverage pose to the insurance firm. The larger the vehicle, the more points a driver has and the high risk urban area where deliveries are made, a courier premium can cost annually up to £3,000 or more.

What vehicles need courier insurance?

Any type of vehicle can be used to make deliveries. All but one vehicle will require that courier insurance be obtained. This includes vans, cars, trucks motorcycles and scooters. The only vehicle that does not have to have this type of cover is a bicycle.

Why is courier insurance so expensive?

Courier van insurance is more expensive than regular vehicle non-commercial social, domestic and pleasure insurance due to the higher level of risk the vehicle poses to the firm. Deliver people are on the road more than the average citizen, and most have a deadline to meet. This increases the risk due to how they will drive to meet the deadline. They also drive during the worst hours of traffic and into the late night hours. Both are classified as high risk. The higher the risk, the more the costs for insurance.

What types of vehicle are good for couriers to use?

The right type of vehicle for a courier to use is dependent on what they are delivering in terms of size, weight and area of the deliveries.

  • Motorcycles and scooters are ideal for use in high congested areas where the packages are small like important papers or ready to eat food.
  • Small cars and vans are suitable for neighbourhoods and suburbs for the delivery of ready to eat food, groceries, small packages and like items.
  • Trucks and large vans are used to deliver large, heavy and bulky items.

What should be remembered is the smaller the vehicle, which includes both its size and engine displacement, the lower the risk which translates to lower premium costs. This is one situation where bigger is definitely not better.

Are there any optional covers for a courier?

The road risk portion of hire for reward courier insurance policy is mandated by the government. The minimum cover is Third Party Only, which does not protect the driver or the goods they are transporting. The following are areas where cover is available and could be beneficial to the courier.

  • Goods in Transit is used when high cost items are being transported. For some agencies that hire independent couriers, it might be required. Ready to eat food couriers generally do not need to have this cover because of the low cost of food replacement.
  • Breakdown cover assists the courier by providing help when stranded on the road. This can also include the delivery of items the courier is carrying.
  • Public liability cover is protection if a case is filed in courts claiming the courier or their vehicle has caused harm or damage to them. When working with the public, this is advisable to have.

How can money be saved with courier insurance?

Saving money on delivery driver insurance is simply done by reducing the risk to the insurance firm. This is accomplished in several ways that include the following;

  • Pay the premium annually will remove the interest payments people incur with monthly and quarterly payments.
  • Increase the excess paid when a claim is filed.
  • Park the vehicle off the street and in a locked building when not in use.
  • Be a good and safe driver and when possible install a telemetric device to prove it.
  • For independent couriers, advertise your services on the side of a vehicle. This reduces the risk of the vehicle being stolen.

To help couriers stay safe during the pandemic of COVID 19 the UK government has issued this advice for drivers transport delivery of items safely and properly.

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