By Joseph Lalla, Account Executive
Georgetown Insurance Service, Inc.
Silver Spring, MD
Livery vehicles are for-hire vehicles that are used by businesses to generate revenue by transporting people. Think taxicabs, limousines, buses, van pools and even hotel shuttles. However, not all commercial passenger vehicles are the treated the same, especially when it comes to insurance coverage and other requirements.
Here are some the differences between these vehicles:
- Taxis – A taxicab (taxi) is essentially a vehicle that is hired along with a driver to carry passengers to and from specific destinations for a fee. This fee, which is assessed using a taximeter, is based on the time and distance it takes to complete a person’s ride. They don’t provide pre-arranged transportation but are rather hired (or hailed) by individuals or dispatched to specific locations on an as-needed basis.
- Other Livery Services – While limousines, shuttles, buses and vans also drive customers from place to place, they are very different from taxis in one major area – all trips are prearranged and scheduled with specific pick-up and drop-off locations that are known in advance. In addition, limousine companies usually consist of luxury sedans, SUVs and other upscale vehicles that set them apart from taxi companies. Shuttles, van pools and buses are also treated like limousines since they operate on a fixed, prearranged schedule as well.
So, why exactly do these differences matter? Well, when it comes to insurance, taxis and other public livery services are not treated equally. As the owner of a limousine, shuttle, van or bus company, you need commercial auto insurance to ensure your passengers, employees, and vehicles are taken care of in the event of an accident. Aside from that, you also must ensure your insurance policies meet the appropriate federal guidelines and adhere to specific requirements set forth by airports and city authorities. In addition to a commercial auto insurance policy, it’s beneficial to supplement that coverage with these programs:
- Increased liability limits, up to $25 million
- Driver training program
- Driver motor vehicle record program
- Workers compensation program for livery operators
- Drug testing
- Driver monitoring systems
At Georgetown Insurance Service, our livery program is tailored specifically to the unique needs of limousines, buses, shuttle buses and van pool businesses. Due to the specialized nature of these public livery services, taxi cabs and dispatches are not included.
Whether you work for yourself, operate your own fleet or work for airport, our agents can help you find the right insurance solutions for your situation.
Have questions about your personal or commercial insurance? Contact us to speak with a licensed insurance professional.
I need to find airport transportation for my husband for his next business conference. Your information that livery services like limos and shuttles have the option for prearranged and schedules services is great to learn. I will start looking for one that has the auto insurance you explained and also some high-quality customer reviews.
We’re glad you found the information helpful and thank you for reading our article. We have a library of helpful articles on our website which you can access here https://www.georgetownins.com/about-us/blog/ or you can also use the search field near the top of the website to search for any key words on our website. Additionally, you can sign up for our quarterly newsletter here https://visitor.r20.constantcontact.com/manage/optin?v=001DWEiOj7A54hgge2WE1KhpYIspGdCmgIJ6GZJX3in2bzzTBk4IrM68K3NBfpGxXvRY0qenzcjY97IEDVrd2hmkHiWJqz3O4fftv9Q4CrQa8E%3D
Best regards,
Georgetown Insurance Service
an Alera Group Company
I am looking at starting a transportation business and need to know how to classify it. Based your description of a livery company vs a taxi company. The company will infact be called an electric cab company but our business will almost always be predetermined much like you describe a livery service to be. I will most often charge by the trip and sometimes charge by the hour or mile. I don’t see myself sitting waiting at a location for fares as would be the case as you describe a taxi. The car to be used will be a Tesla giving the feeling of luxury likened to a limousine or town car so my hope is to have mostly that kind of business. A hired car more then a taxi. I checked with our town and they told me a taxi must have xyz coverage but I did not inquire as to the mandate for livery. Would you suspect it is the same?
Any direction you can offer would be appreciated, I will need an insurance quote as well. One Vehicle and just myself driving initially but growing to a second car and 2 additional drivers by the end of the second year of doing business and a 3rd car and up to 4 drivers by the end of the third year.
Please visit our Public Livery Insurance page for more information. https://www.georgetownins.com/business-insurance/specialty-programs/public-livery-insurance/