But before you start any business venture there are a number of questions you should be asking yourself. For example, where are my customers going to come from? How am I going to pay the bills while the business is starting up? Do I need council approval for this? Do I need any special licenses? How much will the insurance be? Is this even legal?
Currently ridesharing in Victoria is actually illegal, and would therefore be excluded by any insurance policy for that reason. If you’re in NSW or WA where Uber has been legalised there is still a blanket exclusion in all private and all standard commercial motor policy wordings while the vehicle is in use for hire or reward.
There are specialised products available for taxis, but they are only available where the vehicle has Taxi registration plates and the car is being driven by a person with a Taxi license. The premiums and excesses are very high taking into account the higher risk of being on the road more often, in addition to the business liability required to fill the gap between vehicle registration and your legal liability as a business operator.
A Taxi insurance product will cover private use as well so you only need one policy, but the premium won’t be reduced because the taxi only operates 8-12 hours per week, you’ll be paying the same premium as a full time Taxi.
There are also specialised products available for chauffeur driven cars which have slightly better pricing and excess options. However to be eligible your vehicle still needs to have the correct commercial hire plates from Vicroads, and you need to be able to produce a valid chauffeur license in the event of a claim, all of which usually outweigh the potential income you could receive.
So what seems like an easy way of making money is hopefully sounding very serious and very risky, which is what all business ventures are!
Here at Simplex we love supporting new businesses and helping them navigate their insurance requirements to make sure they’re protected as much as possible. If you’re considering starting any business venture please contact us to discuss what insurances you may need and the potential costs involved so you can make an informed decision.