What is livery insurance?
Livery insurance is a branch of vehicle insurance that protects businesses that generate revenue by transporting people.
What makes it any different from a commercial auto insurance policy?
With livery insurance, you can secure both assets and customers under the same policy. There are numerous risks liveries face, including but not limited to:
- Accidents– Regardless of the experience of the driver, you never know when they will hit a street light, damage property, or injure someone. USA today reports that traffic crashes claimed 36,750 lives in 2018.
- Natural causes– Flood, hurricanes, falling trees- a lot of natural causes affect locomotives randomly. Cox Automotive reported that hurricane Harvey alone claimed 600,000 vehicles. If the frequency of any natural disaster in your state is high, you’ll need to tailor your policy accordingly.
- Theft or vandalism– Insurance Information Institute states that every 230 out of 100,000 American cars were stolen in 2018. An addition to your auto policies can help you divert such risks.
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Who needs livery vehicle insurance?
The following businesses are vulnerable to unique risks that a livery insurance can to cover:
- Limousine services– Companies that provide pick-up and drop-off limo services require limousine insurance.
- Taxi services– A taxi insurance policy protects companies that provide taxi services.
- Rideshare services– Personal auto insurance only covers for the vehicle owner. It does not cover for a rideshare passenger. Companies with a rideshare business model should opt for rideshare insurance.
- Non-emergency medical transportation (NEMT) services– Vehicles that transport people for medical appointments require NEMT insurance.
Coverages and policies under livery insurance
Livery insurance encompasses the following coverages:
Commercial General Liability Insurance:
A general liability insurance reimburses you for claims sprouting from bodily injury or property damage caused by your employees, operations or services. business, general liability insurance is necessary.
- Bodily injury- Bodily injury covers any physical damages when you are at fault. It will oversee all expenses- the cost of transportation, lost wages, medical bills, follow-ups, and funeral expenses.
- Property damage- Property damage pays for any repairs to property damage when you’re at fault in an accident.
Employment Practices Liability Insurance:
Employment practices liability insurance exists to protect you from claims filed against you by your employees. These claims are mostly related to wrongful termination, sexual harassment, and discrimination.
Common Endorsements for Livery Insurance:
- Uninsured/Underinsured motorist: Even though many states mandate auto insurance, not everyone has it. A vehicle owned by your business might get into an accident with such a motorist. Uninsured motorist (UM) coverage can indemnify you in such cases. You won’t have to pay for such liabilities out of your pocket. Also, most states mandate UM/UIM for limo service providers.
- Bodily injury
- Property damage
- Collision deductible waiver- waives your insurance deductible in a situation where the driver is at fault or is uninsured/underinsured.
- Physical damage– There are many ways in which a car can sustain harm. Different types of coverages exist to handle different kinds of accidents.
- Collision- covers for any damage repairs when your livery collides into an object (e.g., fire hydrant).
- Comprehensive- pays for any damage to the livery, except for collision. Some common risks can be fire, natural causes (storm, falling tree), theft, and vandalism.
- Accessories- It covers all types of equipment installed in the vehicle, such as communication radio, odometer, and GPS.
- Specified peril- Specified peril is also known as Combined Additional Coverage (CAC). It pays for coverages specified in your policy. For instance, you can specify theft, fire, etc. on your contract. But whatever you exclude in your contract will not be supplemented.
- Towing- This covers your towing services fees whenever you require it.
Common exclusions of livery insurance
Livery insurance doesn’t cover the following risks:
- Theft– Although policies do cover theft, if the theft occurs due to negligence (e.g., leaving keys in the car, keeping the windows open), it will not be insured.
- Unauthorized use– Livery service insurance pays for what the job entails- transporting people. If you use the vehicle for any other purpose (e.g., delivering goods) and an accident happens, the insurance won’t kick in.
- Driving outside the region– You might work your vehicle outside your area of operation. But your insurance only covers losses in your registered area.
How much does livery insurance cost?
A lot of factors account into the livery insurance premium rate. They are: