Drivers warned that offering lifts for cash could invalidate insurance
If drivers make a profit, insurers may class a lift share as a ‘taxi service’ and invalidate their policy, GoCompare Car Insurance has warned.
Drivers are being warned not to offer people lifts home for profit this Christmas, following reports of people offering their services on social media.
Those offering lifts may see it as an easy way to make some extra cash to help cover their motoring costs or pay for Christmas – while people accepting them may think they can save money on a taxi fare home.
But GoCompare Car Insurance is warning that drivers advertising their services in this way and making a profit would effectively be acting as an illegal taxi service.
They may end up committing several offences and invalidating their private car insurance policy – meaning they would not be covered in the event of an accident.
If drivers make a profit, insurers are likely to class the lift-share as a taxi service, for 'hire and reward' and invalidate their policy Lee Griffin, GoCompare
Pembrokeshire County Council recently said it had been made aware of “illegal taxis” operating in the county – mainly young drivers offering “lifts” on social media.
It said legitimate taxi drivers need to go through rigorous checks to ensure that they are safe and suitable to transport people.
The council said police will be targeting those suspected of acting illegally – and anyone thinking of offering lifts for payment should be aware that they will not have the appropriate insurance – and if caught they could face a fine or be banned from driving.
GoCompare, which reviewed 362 private, fully comprehensive car insurance policies found that private car insurance policies typically prohibit “passengers carried in the course of a business for hire or reward”.
One in 10 (10%) policies provide no cover for lift sharing and where private car insurance permits lift-sharing, it is restricted to social journeys and drivers are prohibited from making a profit.
Lee Griffin, chief executive of GoCompare, said: “The rising cost of motoring coupled with the current financial squeeze for many people has made lift sharing an attractive proposition.
“Most insurers will allow genuine lift sharing and there are loads of legitimate schemes across the UK.
“But drivers are not allowed to make a profit from their passengers and can only charge enough to cover petrol and other costs.
“If drivers make a profit, insurers are likely to class the lift share as a taxi service, for ‘hire and reward’ and invalidate their policy.
“As well as the driver breaking the law, passengers are left incredibly vulnerable by illegal taxis and people need to be aware of the dangers.”
Cllr Phil Baker, from Pembrokeshire County Council, previously expressed his concerns about social media platforms being used to offer “cheap lifts”.
“I would urge everyone not to accept these offers regardless of how attractive the fare may sound,” he said.
“You may be compromising your safety and the consequences could be devastating.”