What is Hire and Reward Insurance?

Hire and reward is a type of insurance that allows you to legally deliver anyone else’s goods to people in exchange for payment. Whether you need hire and reward insurance for parcel delivery or you’re providing a service like furniture removal, you will need specialist cover if you are receiving a payment for these services.

However, it is important to note that while hire and reward insurance covers your vehicle it does not cover the goods that the vehicle carries. The goods inside the vehicle would need to be covered by a separate goods in transit insurance policy. We can provide you with goods in transit insurance either alongside your hire and reward insurance or as an additional policy.

What's the difference between courier and hire and reward insurance?

Sometimes hire and reward insurance is referred to as courier insurance. While the two are very similar, it’s important to know the difference between them.

While hire and reward insurance can be obtained by couriers, there are different types of hire and reward insurance that are dictated by the customer’s occupation. For example, there are differing hire and reward insurance policies for hauliers and furniture removal services, both of whom would not be known as couriers from a technical standpoint.

Haulage drivers generally only drive from the point of origin to the delivery address, whilst couriers may have multiple stops, delivering a variety of goods to different people. If you’re transporting larger, heavier goods like coal or containers of merchandise, then you will need a hire and reward insurance policy that specifically meets those needs, rather than courier insurance.

Apart from this, there is little difference between hire and reward and courier insurance. Our experts at Commercial Vehicle Direct will be able to help you with which type of insurance you need based on your circumstances.  Occupation and experience are the main factors that will influence a premium, along with the area that you work in.

Why do I need hire and reward insurance?

Hire and reward insurance cost

How much does hire and reward insurance cost to take out? The short answer is that the cost of hire and reward insurance varies.

Different rates will apply for couriers, hauliers and furniture removers. Hire and reward insurance premiums will normally be lower for hauliers and furniture removers as drivers are usually not rushing at such high demand in a time-sensitive environment, unlike couriers. A courier is likely to also have targets to hit which creates these time sensitivity issues. As such, insurers may raise the premium for couriers as couriers are more likely to make a claim due to both the time sensitivity and couriers often needing to make multiple deliveries on a single journey. In doing so they will need to stop and start much more frequently than hauliers, which is often where accidents can occur.

Hauliers are instead usually undertaking longer distance journeys involving more motorway driving. Therefore, premiums tend to be cheaper for hauliers as claims frequency is lower, but higher in value.

While the goods being carried across all vehicle types don’t usually have an impact on hire and reward premiums, they can if the vehicle carrying them is more likely to be broken into so thieves can obtain high value goods. This would result in a claim being made on the vehicle to fix its damage, which would have an impact on the premium. The goods themselves would otherwise be covered by a goods in transit insurance policy.

Our experts understand the differences between many occupations and will get the right option for you at the best rates available to you based on your needs and circumstances. Understanding your exact requirements, we will ensure the correct risks are outlined to the insurer.

The following factors can also affect the price of Hire and Reward Insurance

• Size of the vehicle – Insurers are more likely to find a larger vehicle more of a hazard on the road, and so charge a higher premium. Larger vehicles are typically able to house more goods, also making them a target for thieves.
• Mileage – The longer a vehicle is on the road, the more likely it is to be involved in an incident. Insurers sometimes ask for an expected annual mileage; from this they can determine the risk-factor.
• Drivers – Information about the drivers insured on the vehicle can determine your premium. For example, if there is just one driver per vehicle as opposed to various, the premium will typically be cheaper. Furthermore, if this driver is over 40 and has no claim history, they will be cheaper to insure than a driver under 25 with less experience
• Special deals – Some insurers offer deals and discounts on vehicles that are being driven on behalf of large courier networks like Amazon, DPD and City Sprint.

Pay-as-you-go Hire and Reward Insurance

We do not currently offer pay-as-you-go hire and reward insurance, although it is available in the market. Despite its flexibility, it may end up being more expensive taking multiple small policies out when needed, as opposed to an annual policy. Though an annual policy may potentially appear more expensive at a glance, it would ultimately avoid debates that can come up with pay-as-you-go as to whether or not the claimant driver was clocked in or not when their accident occurred. It is therefore often the more sensible and encouraged choice to take out an annual hire and reward policy instead, to avoid such potential headache.