Plan Insurance Blog

TfL – PLAN to tackle taxi insurance fraud

Are there 279,000 uninsured taxi and PHV drivers on the UK’s roads?

After TfL’s recent Private Hire regulations consultation, discussions have begun with key industry insiders to tackle issues of insurance fraud committed by private hire drivers.

This comes after a spate of protests by the black cab trade calling for stricter enforcement of existing regulations. Cabbies have staged a series of demonstrations over last year targeting both Uber and TfL againstwhat they feel isan uneven playing field.

The appetite for change appears to be there – it just needs galvanising. With the support of the LTDA, the United Cabbies Group, the RMT London Taxi Drivers’ Branch, the GMB Union Professional Drivers’ Branch and an entire community of honest law abiding drivers behind us, we could do just that.

Private hire driver numbers in London have increased by 62% since 2010. This has lead to the antiquated systems for detecting and checking insurance and licencing documents being unable to cope with the new volume of drivers.

It is important for the general public that Private Hire drivers have appropriate insurance cover not onlyto allay concerns over their safety.

Failure to do so may also result in delayed compensation payments to those involved in an accident, and higher motor insurance premiums for other drivers if insufficient cover is in place.

In July 2015 the AA estimated that uninsured drivers cost the insurance industry around £380million a year.

They calculated that £33 a year from every insured driver’s premiums funds compensation that is provided to victims of accidents caused by uninsured and untraced drivers.

Key Stats Private Hire Figures - Plan Insurance Brokers
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The issue is of taxi insurance fraud is not limited to London and is committed by both public and private hire drivers. There are over 389 licencing authorities in the U.K. and no uniformed regulatory approach.

Without a centralised database for councils and other relevant authorities to refer to, dishonest and potential dangerous taxi and private hire drivers may be finding it easy to avoid detection.

An insurance audit report leaked to the BBC in 2010 revealed 93% of 1,200 taxis inspected (outside of London) were not sufficiently insured.

Since this research was conducted little has been done to improve regulators’ abilities to enforce and monitor driver’s insurance cover requirements.

If the 93% figure is applied to current taxi numbers in the UK today, it would equate to 279,000 uninsured taxi and PHV drivers on the UK roads and over 88,000 in London alone.

As recently as last June, Leon Daniels, Managing Director, TfL described the current checking process as a;

Laborious, hopeless manual system with a poor trust factor due

to low levels of accuracy.

How are uninsured public & private hire drivers evading existing systems of detection?

  • Presenting False Insurance Documentsdoctored or duplicated documentation supplied when applying for a Private Hire licence.
  • Operating with Expired, Cancelled or Invalid Cover
    drivers take out short term “Hire and Reward” cover to show the authorities when obtaining  a Private Hire licence. When this runs out they then arrange cheaper private car insurance to avoid their vehicle showing up on the police’s ANPR (Automatic Number Plate Recognition) checks as unregistered on the MID (Motor Insurance Database) but  these policies do not provide cover to carry passengers.
  • Using Identity mirroring” scams 
    multiple drivers may be operating under one licence using one vehicle

On January 20th, following their regulatory review that included a public consultation that garnered 16,000 responses, TfL set out proposals to modernise the Capital’s private hire industry.

A number of measures have will now be presented to the TfL board, two of which relate to insurance. Under the proposals drivers will have to carry or display a copy of their insurance certificate at all times. Making private hire drivers display their documentation will bring their requirements inline with their black cab counterparts.

They will also be required to have “hire or reward” insurance in place at all times while registered to an operator. The question of how this measure will be implemented was not mentioned.

As it stands both public and private hire vehicles in London are required to undergo two MOT tests each year, in addition NSL test centers must also carry out a taxi vehicle specific inspection on an annual basis prior to a licence being issued.

However the high profile Black Cab blog Taxi Leaks used under cover tactics to reveal the fact that NSL centres do not currently inspect private hire drivers insurance cover to ensure it is fit for purpose i.e. that includes use for “Hire & Reward.” In a secret recording an inspector can be heard confirming that they merely check that the vehicle in question has an insurance policy in place. This policy may only be for social, domestic and pleasure purposes.

Black cab drivers site TfL’s inconsistent approach to regulation on this topic as a major bone of contention. Evidence of a valid ‘Hire and Reward” insurance policy must be provided  to inspectors by black cab drivers  at the point their vehicle is licenced.


Plan Insurance Brokers have outlined plans for an online portal with the working title Taxi Insurance Checker (TIC.)

TIC will be similar in concept to the Motor Insurance Database, which has significantly reduced the number of uninsured drivers on the UK’s roads.

TIC will provide authorities access to live information regarding the validity of PH driver’s policies and whether it provides cover for carrying passengers for the purposes of “Hire & Reward.”

TIC will help avoid:

  • Members of the general public being driven in uninsured vehicles
  • General motor insurance premiums rising to subsidise claims of fraudulent PH drivers
  • Licensed PH drivers not being “fit and proper” persons
  • Illegal touts targeting venerable passengers

We’ve been lobbying TfL for sometime on the issue of drivers operating with invalid insurance and invited Plan Insurance Brokers to join a consultation due to their forward thinking approach to technology.

Steve Garelick Head of GMB Union Professional Drivers’ Branch

If implemented, we believe the plans being discussed will significantly reduce the number of taxi and private hire drivers able to perpetrate insurance fraud, whilst at the same time also improving safety and offering peace of mind to passengers and authorities alike.

Ryan Georgiades, Managing Director, Plan Insurance Brokers

Plan have been busy lobbying organisations with a vested interest in the implementation of TIC or a similar system. As well as TfL a co-ordinated response will be required by the Insurance Fraud Bureau, the Association of British Insurers, the Motor Insurance Bureau and other related trade organisations.

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