Income Protection for Taxi Drivers. Broker Deals.

taxi drivers income protection insurance > 15 secs

Income Protection Taxi Drivers

Why Taxi Drivers need Income Insurance?

Being a Taxi Driver can be a mentally challenging choice, given long hours often worked or just waiting for your next fare. Also, you have had to contend with Inner City Clean Air Zones plus the Pandemic challenges.

You could be typically working from 41 to 43 hours per week, evenings, weekends and bank holidays. The average income being upto £30k plus for experienced drivers and dependant upon location in the UK.

But for Income Protection Insurance purposes, taxi drivers are considered by some Insurers to be a higher risk insurance group ie; driving doesn’t require alot of daily physical activity being static.

If you are a self-employed Taxi Driver or cab driver, private hire driver, minicab driver etc; you may not have access to any employer comprehensive sick pay arrangements.

If you work via Uber, then you may have access to their basic partner protection (see below). Even if you are employed, you may still not be provided any suitable long term backup plan.

Let’s examine various issues of the job role & then how it may effect taking out income protection or critical illness life insurance.

Taxi Drivers Income protection

What is the Taxi Driver Medical Test?

The Taxi Driver Medical is a legal medical assessment that all taxi or private-hire driver must complete before being granted their licence.

A fitness for purpose certificate is then given by the doctor to confirm this to the DVLA. If the health test wasn’t successful and the taxi driver doesn’t fit the medical requirements, then it is obligatory to also report this to the DVLA. 

If the driver suffers any heart related conditions, a special taxi driver medical (heart test) is also required before being allowed to drive their taxi again.

The main heart conditions that are associated with drivers are heart disease and heart failure.

Symptoms of heart related issues can include fainting, dizziness and even black-outs. All these could cause a taxi driver to lose control of the vehicle, putting themselves & their passengers in danger.

These medical tests are done to ensure that all drivers are well and safe enough to drive a private hire vehicle and maintain the safety of the public on the road.

PHI Insurance I am sick | Income Protection Taxi Drivers
No Taxi Driver wants to fail their ‘Driver Medical Test’

If you own the taxi business, also consider the income it may lose in your sickness absence & for how long to maybe cover this insurance wise. During the Pandemic, The Licensed Private Hire Car Association estimated the industry was short of 160,000 of the previously 300,000-strong workforce. So to help keep the country moving as key workers goes a big thank you review

It came to light recently that the infamous Russian President Vladimir Putin actually moonlighted as a Taxi Driver in the 1990’s during the fall of the Soviet Empire !!

taxi drivers income protection
* source thesaurus plus

Taxi Drivers Hour Regulations & Rest Periods

When you drive a vehicle which carries passengers, there are certain legal rules and regulations around the hours that you can work which you should adhere to.

After each 4.5 hours spent on the road, drivers must usually take a 45-minute break. (despite legal time breaks). It is claimed 1 in 8 drivers admitting to falling asleep at the wheel, so legal restrictions aren’t just legal, they could be are life-saving.

  • After 5 1/2 hours of driving, you must take a break of at least 30 minutes for rest and refreshment
  • Alternatively, within any period of 8 hours 30 minutes, you must take at least 45 minutes in breaks
  • Every 2 weeks you must also take 24 hours off duty.

This less active role of lorry driving, combined with the unhealthy lifestyle commonly associated with the profession, puts long-distance drivers at risk of developing chronic diseases such as diabetes and cancer, according to latest academic research.

Are Taxi Drivers entitled to Sick Pay?

If you mean full sickness pay covered for your hours worked, the answer is usually ‘No’ (other than maybe SSP or Government Employment & Support Allowance which usually amounts to less than £100pw).

Note: SSP is usually not paid for the first 3 days that you are on sick leave. These are called ‘waiting days’ (the rules on this may change temporarily for the duration of the coronavirus pandemic). 

Taxi Drivers Income Sickpay Insurance | The Knowledge
London Cabbies & ‘The Knowledge’ Test Facts

UBER Taxi ‘worker’ status and Statutory Sick Pay

The UK Courts in 2021 recently found some Uber drivers were classed as ‘workers’ rather than ‘self-employed’ for employment law purposes and sickpay.

Uber argued that their drivers are independent contractors who work under contracts made with customers and so do not work for Uber. The Supreme Court disagreed. 

Even if Uber drivers are ‘workers’ under UK employment law however, they will not automatically become entitled to Government Statutory Sick Pay (SSP) from Uber.

This is because currently, most Uber drivers are treated as self-employed for tax purposes and so are paid gross. 

UBER Insurance for Drivers 2022

Partner Protection Insurance Key Highlights

  • Accidental Death £50,000
  • Funeral Expenses £6,000
  • Medical expenses re-imbursement £7,500
  • Permanent Injury £50,000
  • Bodily Injury | Severe Sickness £65 per day for 15 days
  • Hospitalisation £1,000
  • Maternity | paternity £900
  • Court attendance £500
  • Insurance via Allianz

There is a long list of exclusions & too detailed to go into here, including any pre existing health issues.

Uber state the reason for this cover is they wanted to help protect their Uber independent/self-employed taxi driver Uber partners (who are eligible for Partner Protection) drivers from the risk of major costs or lost income.

They comment that their insurance for life-changing events like injury, sickness or having a baby shouldn’t have to come with additional financial stress. That is fair enough for the short term.

uber taxi drivers income protection sickpay
UBER Insurance for Drivers

Uber Taxi Drivers Income Protection | Conclusion

Let’s be fair, this plan is better than having no insurance cover as a Uber taxi driver?

However, most of the cover issues relate to accidents or short term illness – not longer term more serious and common issues like cancer, heart attack or stroke. All these could threaten a Taxi Drivers longer term income ie; After 15 days you maybe onto your own savings back up plan unhappy face

Income Protection Insurance PHI | Taxi Drivers

Typical Key Features

  • Designed to pay out 💯 100% Tax Free Income – Insurance to cover lost salary/wages as a Taxi Driver
  • Usually has an initial waiting or deferred / waiting period from 1/4/8/13/26/52 weeks 
  • Some Insurers will also not allow Taxi Drivers access to their short term waiting periods
  • PHI benefits are currently paid out tax free on claim until you return to work or plan end date
  • Insurers Plans can usually run upto state pension ages or some upto age 70
  • Income Insurance Benefits may be level or inflation linked from outset or claim
  • Medical evidence is usually required for underwritten insurance before any terms offered
  • Cover may be based on maximum of say upto 65% of your gross annual earnings
  • Waiver of Premium so you do not have to pay the premiums in claim
  • Death benefits (if included) may just mean a lump sum sufficient for funeral costs or return of some premiums

Note: Insurers will also need you to either proove your taxi drivers monthly income (as you cannot be better off sick than well) or request that you were working more than a set numbers of hours to qualify for cover. During Pandemic 2020’s, some Insurers have also removed their shorter 1 day / 1 week deferral periods.

Income Protection & Taxi Drivers

2 Types of Income Sick Pay Insurance

Comprehensive Income Cover

  • Covers you until you either go back to work …or maybe never go back to work
  • Protects you on an ‘own occupation basis’
  • Premiums may be fixed none-reviewable

Budget Income Cover

  • Budget cover may only payout per claim for upto say 12 | 24 | 60 months (ie; limited term)
  • Premiums may be annually age costed / 5 yearly reviewable
  • Invariably this type of plan is initially alot cheaper but will cost more in the future

taxi driver & income protection insurance > 15 secs

Sickness Insurance For Taxi Driver | Underwriting & Health Issues

You pay a monthly premium throughout the term of the “Income Sickness Insurance” policy. Cost for a taxi driver depends mainly on:

# Your Age – at the time you start the policy ie; older people are more likely to suffer an illness, so pay more.
# Your Gender – being male or female no longer affects rates wef 2012 via income providers.
# Your Health – at the time you start the policy. If your health is poor eg; raised BMI kg, blood pressure or cholesterol you may have to pay more, have exclusions or even be refused sickness cover.
# Your Occupation – Taxi Drivers working role & mileage travelled being more likely than others to contribute towards illness
# Hobbies and lifestyle – for example, rock climbing is high risk, so you’ll pay more.
# Smoker Status – for example, smoking makes you more likely to make a claim, so you’ll pay more than a none smoker.
# Waiting period – once you claim, there is a delay before payments start.

You can choose how long this ‘wait period’ is eg; from 4 weeks or for some insurers maybe also dependant upon your taxi driver occupation. Also, you may have a savings net to fall back on anyway short term ?

The longer this waiting period, eg; 13 weeks, the less you pay.

What does Income Protection Cost?

Well, that’s the million pound question! If you earned £30,000pa then worked for the next 35 years until retirement, you could potentially earn over £1 million gross ie; £30,000pa x 35 years [or more with any future inflation wage rises].

As such, feel free to do you own taxi driver income protection quote – to then value what your income is worth to your family lifestyle and bills if off sick ?

Martin Lewis comments on the value of having an income protection insurance.

taxi cab drivers + income phi insurance

Covid Vaccine & “Income Protection Taxi Drivers

  • Insurers may ask in the last 3 months have you tested positive or had recent contact with anyone with symptoms
  • If so you may have to await your full recovery and be fully OK before you can re-apply for insurance
  • Standard rates will apply after any self-isolation periods & assuming no other ongoing health complications
  • Any refusal to be vaccinated, will not affect consideration payment of an insurance claim
  • Receiving a COVID-19 vaccination & getting side effects Insurers say currently will be treated as any other claims

What happens when I return to Taxi driving after a claim?

  • Policy monthly claim benefits stop after you go back to normal taxi driving job, as will any premium waiver
  • The insurance plan is still active & you will continue to pay your normal usual premiums
  • Some Insurers may then pay a reduced or proportional benefit if you cannot do exactly what job you were doing before as a taxi cab driver
  • This takes account of any earnings loss or reduction due to your illness or injury affecting family life
  • It could be you are in a different occupation also because of your incapacity. Or have to do reduced work hours or restricted your duties.
  • Note: there is usually no limit to the number of claims you can make during your working life
What is critical illness coverage  & Income Protection Taxi Drivers

Taxi Drivers | Critical Illness instead? 

Critical illness insurance cover pays out a tax-free sum if you are diagnosed with various life-threatening conditions eg; specified cancers, heart attack, stroke, ms etc; as listed in the insurers policy. For some, it is a different alternative to Income Protection Taxi Drivers – as it usually gives you Lump Sums or Family Income Benefits options.

But there are lots of common situations when it would not pay out. For example, if you had back problems or maybe a stress-related illness. Additionally, not all occurrences of the critical illnesses listed are covered, for example some lesser forms / early stages of cancer maybe not covered by Insurers as Martin Lewis comments on.

Note: Lifecover and critical illness cover should not be confused with terminal illness. Terminal illness benefit is usually automatically included within a life insurance policy and means you will not survive, as you cannot be cured.

Chances of making a claim & Income Protection Taxi Drivers
Income Protection = Claim Chance 1 in 4 = During Working Lifetime*Stats changing re Covid19

‘Taxi Insurance Fleet’

Most Taxi Fleets are made up of many types of vehicles eg; hatchbacks, suv, mpv, saloons, mini-buses & coaches. Petrol, Diesel or Electric we have you covered.

If you have less than 5 fleet taxis or more than 5 vehicles in your fleet, please let us help recommend the correct taxi insurance fleet policy for your business needs.

Taxi Insurance Fleet – cover for most vehicle types

Taxi Insurance Fleet | Income Protection Taxi Drivers review
Taxi Insurance Fleet

Income Protection Taxi Drivers Conclusion

Ideally as a taxi driver, if you are concerned about your finances being off sick, then you should have both income protection & critical illness plans (if your budget allows this). For more information on this & costs talk to our professional brokers here.

Article on ‘Income Protection for Taxi Drivers’ by Martyn Spencer Financial Adviser (2024)

For reassurance re health for men & women we review many of the best brands selling Income Protection & Life Insurance in UK (inc NI)