Why illegal plying-for-hire convictions expose HUGE insurance risks for taxi and private hire drivers
- Perry Richardson
- 48 minutes ago
- 2 min read
Recent enforcement action involving a Manchester-licensed driver convicted at Manchester Magistrates’ Court has drawn attention to the huge consequences of plying-for-hire outside a cabbies licensed area.
Under taxi and private hire legislation, drivers must hold appropriate hire and reward insurance that reflects the precise nature of their licensed activity. Where a driver undertakes work that falls outside those conditions, such as picking up passengers in a district where they are not authorised to ply-for-hire, insurers may regard the policy as invalid for that journey when it is not a pre-booked fare through an operator.
In the Greater Manchester case, the taxi driver was licensed by Manchester City Council but was operating within the Trafford borough, where only Hackney Carriage drivers licensed by Trafford Council are permitted to accept immediate hires from the street. Once a private hire or out-of-area taxi driver unlawfully accepts a fare without a booking through an operator, the activity can fall outside the scope of permitted insurance use.
Industry compliance advisers note that most hire and reward policies are underwritten on the basis that the driver will adhere strictly to licensing conditions. If a driver is found to be plying-for-hire illegally, insurers may decline to indemnify the driver for damage to their own vehicle and, in some cases, seek recovery of third-party payouts if non-disclosure or misrepresentation is established.
Regulatory breaches can invalidate cover, trigger criminal liability and leave drivers personally exposed to substantial financial claims
While the Road Traffic Act requires insurers to satisfy third-party injury claims in many circumstances, even where policy conditions have been breached, that does not shield the driver from longer-term financial exposure. Insurers can pursue the policyholder to recover costs paid out, which in serious injury cases can reach six or seven figures.
For drivers, the immediate penalty imposed by a magistrates’ court is often the least significant consequence. Six penalty points for driving without valid insurance can materially increase future premiums. Multiple points may also trigger licensing reviews by the home authority, particularly where public safety concerns arise.
Licensing authorities across metropolitan areas have increased joint enforcement operations in response to concerns about uninsured or improperly insured activity. Breaching licensing boundaries is not a minor technical offence but a risk that can invalidate insurance cover and jeopardise livelihoods.
RELATED NEWS ARTICLE:
