Courier insurance is a form of vehicle insurance designed to protect you against the additional risks of driving while making deliveries. It is a form of hire and reward insurance covering your vehicle’s use in return for payment.
Simply put, driving to make deliveries is significantly more risky than social, domestic & pleasure (SD&P) road usage. You’ll be rushing around to meet tight delivery deadlines, regularly driving down roads that you don’t recognise, often spending long hours on the road at any time, and you may need to park curbside briefly to collect or deliver. The amount you pay for courier insurance reflects this – it is significantly more expensive than regular SD&P cover.
Courier insurance comes in three levels (just like SD&P) – Third Party Only (TPO), Third Party, Fire & Theft (TPFT) and Comprehensive. Third-Party Only is the lowest level and will only cover you for damages to other vehicles (not your own). TPFT includes the same protections as TPO but also covers your vehicle if it’s stolen or damaged in a fire. Comprehensive is the highest level, including everything from a TPFT policy plus cover for any damages you incur (e.g., injury, vehicle damage in a road traffic accident).
The level you choose naturally depends on what you want to be covered for and how much you’re willing to spend, but keep in mind it’s illegal to be on the road without the correct insurance, so at an absolute minimum, you’ll need TPO courier insurance.
It also comes in two forms – full-time courier insurance and ‘top-up’/’pay-as-you-go’ hire and reward. Both have their benefits and drawbacks. Full-time courier policies usually include both courier and SD&P cover, so you’ll always be covered no matter the purpose of your travels. Still, these policies can be expensive, and most are only offered on annual agreements.
Part-time hire and reward can be a more cost-effective option, allowing you to only pay for hire and reward cover as and when you need it, but there are some questions about such policies’ legality. You’ll need to check with your SD&P insurer before you sign-up – many insurers won’t allow you to use part-time insurance solutions. They may refuse to cover you in the event of an accident, so failing to inform them can be an exceptionally costly mistake to make.
Courier insurance hire and reward
Courier insurance hire and reward in the UK can mean two things (and there is a lot of confusion online regarding the exact definition). Firstly, it can refer to the section of a vehicle insurance policy that covers you to use your vehicle in return for payment (“hire and reward). This would cover courier services, furniture removal and taxi drivers, for example. It’s part of a larger full-time policy (that usually includes your social, domestic & pleasure cover within it) and so only makes up one section of the insurance.
It might also refer to specialist insurance offered out to drivers on a ‘top-up’/’pay-as-you-go’ basis. This does not include your social, domestic & pleasure cover but instead sits ‘on-top’ of your existing coverage and typically matches its level (therefore, if you only had Third Party Only SD&P, your hire and reward would also only be TPO). It can be an extremely cost-effective option, but many of the UK’s largest insurers do not allow drivers with an SD&P policy through them to use top-up insurance, so if you are considering it, please check with your provider beforehand.
Goods in transit courier insurance
Goods in transit for couriers is designed to protect the items you’re delivering from damage, loss or theft. It can be a great option for self-employed couriers, especially if you work for multiple businesses, ensuring you won’t be held responsible for any accidental damage/loss that might occur.
Whether or not you need it will depend on your employer – companies like Amazon or food delivery businesses like Deliveroo or JustEat don’t require it, but more bespoke logistics/transport companies like Gophr may ask you to hold a policy before you join them – it entirely depends on who you’re working for, so be sure to check ahead of time.
Courier public liability
Public liability insurance for couriers can help protect you if a third party incurs damages while you’re on the job. This would include incidents like tripping over a member of the public or causing damage to the walls of a store you’re collecting a heavy delivery from.
It isn’t mandatory, but if you’re self-employed, it does come highly recommended – the average public liability settlement in the UK is around £13,500, so when something goes wrong, it can be expensive. If you’re not properly covered, you may be left with costly legal fees and a compensation bill to cover.
Compare courier insurance
You may find it difficult to get quotes online for courier insurance, especially as a younger driver. It would help if you weren’t alarmed – many people are in the same boat, especially as delivery/courier businesses grow, and it becomes a more viable employment option for drivers.
If you are struggling, your best bet will be to try a few comparison websites/aggregators to see which businesses might offer you quotes. You might not receive a full, costed quote online, but it’ll at least give you an idea of which insurers/brokers it’s worth speaking with. After that, try giving some a call directly – insurers often offer special deals for anybody who shops direct (and cuts out the middleman), so don’t be surprised if you’re offered a slightly better deal when giving them a call.