Hire and Reward insurance protects anyone who uses their vehicle to deliver other people’s or other people’s goods in exchange for remuneration (“reward”). Van, HGV, car, motorcycle, and other vehicles can all be covered by Hire and Reward insurance, regardless of whether the vehicle is owned by an individual or a company. Hire and Reward insurance is intended to account for the higher risks associated with operating your car or van for business reasons (as opposed to traditional Social, domestic, & Pleasure purposes such as going to the shops or down to the beach). This guide will explain all you need to know about Hire and Reward insurance, as well as where you can acquire quotes for hire and reward activities like delivery insurance. If we haven’t answered your question, please leave it in the comments box at the bottom of the page.
What is Hire and Reward Insurance?
Hire Reward insurance protects your vehicle while you are using it for a return. This might involve anything from starting a business and helping customers move their goods from point A to point B. It can also include driving for companies like Uber or Amazon.
It, like standard vehicle insurance, will protect your vehicle in the event of an accident. So, it is available in three levels: third-party-only (TPO), third-party fire and Theft (TPFT), and Comprehensive. The chart below shows what you are and are not insured for under each:
Types of Hire and Reward Coverages
| Types of Vehicle Insurance | Third-Party Only | Third-Party, Fire and Theft | Comprehensive |
| Repair if your vehicle is damaged in an accident |  |  |  |
| Repairs if your vehicle is damaged in a fire or stolen |  |  |  |
| Compensation if other people are injured in an accident |  |  |  |
| Damage to other people’s property |  |  |  |
What is Pay-As-You-Go Hire and Reward Insurance?
It can be purchased as a full policy that covers both your business and personal (SD&P) travel, or as a “top-up” policy, such as the one offered by Zego—though you should verify with your SD&P insurance provider to see if they accept top-up coverage, as many do not. Here is our research on which insurers will and will not accept top-up hire and reward cover.
Where Can I Get Low-Cost Hire and Reward Insurance Quotes?
Because Hire and Reward may be a confusing business, many drivers choose to use a specialist provider/broker to assist them in obtaining the best deal possible (in fact, this may be your only option because many mainstream vehicle insurance providers will not offer Hire and Reward in the first place). QuoteZone, one of our partners, works with a number of these specialists, so fill out a quote form and they’ll put you in touch with some of the UK’s best Hire and Reward insurance companies.
What does Hire and Reward Insurance cover?
Hire and Reward will cover you if you are in an accident while using your vehicle for business purposes. Depending on the tier of cover (TPO, TPFT, or Comprehensive), you will be covered for third-party-only damages as well as possible damage to your own vehicle.
It is intended to cover the additional hazards that drivers experience when using their vehicle to make a payment, such as:
- Long periods of driving
- Distractions caused by a mobile phone or app
- Unfamiliar routes and destinations
- Vehicle wear and tear caused by higher-than-average mileage
- Struggling to achieve stringent delivery deadlines
If you choose full-time Hire and Reward coverage (also known as Commercial Vehicle insurance), you should be insured at all times, regardless of whether you’re driving for business or not. This type of policy often includes coverage for both your last-mile job driving and your personal driving. However, double-check.
However, if you have top-up/pay-as-you-go coverage, you must be clear about what you were doing at the time of the accident (i.e., working/not) so you know which of your insurance companies will be responsible for covering you. This is because your Hire and Reward policy would cover your work driving, and the Social, Domestic, & Pleasure (SD&P) policy would cover your personal driving.
Keep in mind that if you haven’t informed your insurer that you’re using your car for business purposes. They may be fully within their rights to refuse to pay (and may even terminate your coverage entirely. So make sure you do so as soon as possible.
Example of a Hire Reward Insurance Claim
- Being in a slight accident while transporting a customer’s dinner to their apartment.
- Your van crashes while you’re assisting in the relocation of someone’s furniture to their new house.
- You crash into a wall while driving a taxi for a taxi app.
Remember that your vehicle insurance only covers your vehicle, not the things you’re transporting or any paying passengers. If you wish to be insured for either of these, look into a Goods in Transit or Public Liability policy.
What Isn’t Included in Hire And Reward?
While it is critical to understand your policy before signing up, here are a few things that Hire and Reward policies typically do not cover:
- Damage to any products or tools you’re transporting.
- Coverage that extends beyond the limits of your policy.
- Any financial losses or injuries suffered by travellers.
- Theft of any valuables contained within the vehicle.
- The vehicle is being operated by someone who is not authorised to do so,
Who Is In Need of Hire and Reward Insurance?
If you’re using your vehicle for a return, you’ll almost certainly need Hire and Reward insurance. This includes (but is not limited to)
- Couriers
- Hauliers
- Drivers of Taxis
- Chauffeurs
- Companies that remove furniture
- Driver for Package Delivery
- Driver for Food Delivery
If you want to work in any of these industries, practically every company will want you to have a valid form of Hire and Reward before they will consider hiring you. Their requirements differ, so double-check before applying to ensure you have all you’ll need. And, as with some insurers, some will not accept top-up/pay-as-you-go coverage, so you may need to seek a full-time policy.
What Is the Cost of Hire and Reward Insurance?
Because of the dangers described above, Hire and Reward is nearly always much more expensive than regular vehicle insurance. While this may deter some, the UK home delivery business is still booming, increasing 23 percent at this time last year. Forecasts suggest it will continue to rise by an average of 6.5 percent even after the COVID-19 pandemic is over. That is to say, there is a lot of money to be gained as an opportunistic driver (and we have a guide on how to earn more).
Having said that, according to our larger research piece on the cost of Delivery Driver hire and reward insurance, a typical driver can expect to pay around £140 per month for third-party only (TPO) courier van insurance, £150 per month for motorbike courier insurance, and around £220 per month for courier car insurance. While prices vary according to criteria such as age and location, they should give you an indication of what to expect.
Your price will vary depending on a variety of criteria, most of which will also affect your risk profile as an SD&P driver. These are some examples:
- Mileage per year
- Location
- Age
- Prior allegations/convictions
- Years spent on the road
- Make/Model of Vehicle
It’s not difficult to anticipate how these variables can affect your risk profile (and eventual policy cost). Smaller, less powerful, or less expensive vehicles will be less expensive to cover than their larger, more powerful/expensive counterparts. Also, insurers will always be happier to cover a 42-year-old driver with 20 years of driving experience than a 22-year-old with 2, so don’t be surprised if you are in the riskier half of any of these.
What to Expect From Hire and Reward Insurance Options
#1. Policy advice from a specialist
Consider hire and reward insurance to be a category under which several sorts of specialised courier plans fall. The service you offer will determine the policy that is best for you because each service faces a unique set of potential risks and is subject to varying degrees of risk.
Before you commit to a new policy, compare insurance quotes from specialists and shop around. In many circumstances, choosing specialised insurance providers over general coverage can be more cost-effective.
#2. Coverage for food delivery drivers
Delivery drivers must have specialised insurance, typically food delivery insurance. This may come as a surprise if your fast food delivery driving is a casual position outside of your regular 9-5. However, the law considers you to be driving for hire or reward and hence requires insurance coverage.
#3. Insurance for couriers
Couriers frequently make many stops in order to transport a variety of commodities to various destinations, necessitating the need for courier insurance, which is a subset of hire and reward insurance coverage that reflects this.
If, on the other hand, you were shipping large or heavy products to a single address, it would be more appropriate to obtain coverage that suits those specific demands. Obtaining proper transportation insurance guarantees that you are adequately covered.
#4. Van Hire and Reward Insurance
Your hire and reward insurance can cover all types of automobiles. This type of policy is able to cover motorcycles, cars, and vans.
When you obtain a quote, you must furnish your insurer with specific information about your vehicle. You cannot drive several vehicles interchangeably unless your policy allows it.
If you drive a van, you may discover that selecting a certain form of cover, such as courier van insurance, provides the best value for money in an insurance quote.
#5. Pay-as-you-go Hire and Reward Insurance.
Some insurers will provide flexible pay-as-you-go coverage, which is very handy for casual workers but may not be the best value if you do hire and reward full-time or on a regular basis. If you opt to purchase this form of insurance, be sure to clock in and out every time you work.
#6. Flexibility in the gig economy
If you have numerous vocations, such as a taxi driver who also works for a food delivery app like Uber Eats, Just Eat, or Deliveroo, or delivers Amazon boxes as a side hustle, you must formally notify your insurer.
Some hire and reward insurance will only insure you for your initial role. So, if you start supplementing your income through numerous occupations that require driving, be sure you are adequately insured. If you don’t, you risk having your insurance invalidated; therefore, it’s best to be safe and comprehensive with your coverage.
#7. Car insurance for commercial use in class 3
Hire and reward insurance is sometimes known as Class 3 business-use car insurance. It’s a more comprehensive version of your ordinary car insurance that takes into account the hazards you face when driving for business.
The rise in perceived hazards is the result of a number of variables, including more time spent on the road. As previously stated, this form of insurance is a legal requirement that many insurers provide.
#8. Insurance against public liabilities
In addition, to hire and reward insurance, you may be able to obtain additional coverage to properly protect yourself at work (and not just on the roads). For example, public liability insurance protects you if you injure someone or damage their property.
#9. Couriers’ goods-in-transit insurance
Although hire and reward insurance may cover your car, most insurers will not cover the products your vehicle transports. Therefore, you may want to purchase separate goods-in-transit coverage.
If your vehicle is stolen, along with client stock, this might be quite costly, but with goods in transit insurance in place, you can be assured that you will not be obligated to cover those costs.
How to Get Cheaper Courier Van Hire and Reward Insurance
#1. Select a smaller, less expensive vehicle.
It is not always viable to drive a smaller vehicle because your job may necessitate the use of a van or truck. However, these pose bigger risks in the eyes of insurers. It indicates that you are more likely to be involved in a road traffic collision.
Because of these assumptions, larger, heavier vehicles tend to be more expensive to insure. If driving a smaller vehicle is more convenient for your job, it may also be more cost-effective.
The cost of your vehicle will also have an impact on the quotes you obtain since more costly automobiles are normally more expensive when it comes to repairing parts or compensating for damages. Insurance companies anticipate that higher-priced cars, vans, and lorries will be targeted by thieves as well.
The faster and more powerful your vehicle, the higher your insurance costs are likely to be, so think carefully before purchasing any sports model.
Investing in a new van could save you money because they are more fuel-efficient and generally less expensive to operate.
#2. Reduce your annual mileage.
Your annual mileage informs your policyholder about how much time you spend on the road, which assists them in determining the risk that your vehicle may be involved in an accident. From an insurance standpoint, the more time spent on the road, the higher the risk.
Other considerations include the type of roads you will be travelling on and whether they are congested, the time of day you will be driving, and overall driving conditions.
#3. You should be a mature, safe, and experienced courier driver.
Your age, degree of experience, and driving record all have an impact on the insurance deals you will be offered in the future. Years of driving expertise and a lack of reckless driving will certainly work in your favour.
Hire and reward insurance policies may be difficult to obtain for those under the age of 25, but those over the age of 40 have the best chance of finding the most competitive deals.
Having numerous parties covered by one insurance policy may lead it to cost more, but if the main driver is very experienced, you can often encourage cheaper prices.
#4. Keep your no-claims bonus.
Drivers who have accumulated a no-claims bonus typically receive lower insurance quotes, and most insurers will consider whether you have made claims in the last few years.
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