In Qatar, it is not only a legal obligation to have insurance for taxi and limousine services, it is a business imperative for the protection of taxi and limousine operators. Because of expensive financial liabilities, including vehicle repairs, claims and vehicle downtime, there is a need to secure insurance for taxi and limousine operators. This guide serves to discuss each taxi and limousine insurance in Qatar.
Insurance vehicles specially for the transport of passengers is a greater risk exposure from insuring a personal vehicle.
High Mileage and Constant Use: Every day taxis and limousines are on the road for extended periods of time, accruing more kilometers on the odometer than a personal vehicle would in the same amount of time. This continuous use increases the likelihood of being in an accident and increases wear and tear.
Frequent Passenger Turnover: There is a constant stream of different customers, so the potential for liability claims is much higher. There will be injuries related to paying customers, so sudden stops or minor collisions result in injuries and claims.
Increased Accident Liability: There is increased accident liability because the infrastructure is dense. More people are in the area because of traffic, and frequent stops are in places like airports and malls.
Business Interruption Risk: There is more than just repair costs due to damage to a taxi or limousine. Every day the vehicle is off the road is a day of lost income, and this downtime is a financial threat to the operator.
Third Party Property Damage: There is an increased risk of damage to third party property like hotel entrances, parking barriers, or vehicles. This is because the taxi or limousine is often in busy tight spaces like drop off zones.
These heightened risks experienced by companies in the hauling industry have led underwriters to develop niche commercial auto insurance products tailored to these unique exposures.
Types of Taxi and Limousine Insurance
Similar to private vehicle insurance, commercial car insurance policies in Qatar are based on two underwriting variables - Third Party Liability and Full Coverage, but the framework and parameters are modified to reflect the commercial realities.
1. Third Party Liability Insurance (TPL)
This is the absolute insurance minimum that any vehicle, including commercial vehicles, requires under Qatari legislation.
Coverage includes the, body injury or death of any third party which in this instance is classified as a pedestrian, occupant of another vehicle, or any other person using the road Legally, the owner of a motor vehicle is required to pay damages to third party road users.
Who is responsible for the payment of damages to another party (a third party) or his property? Your policy does not extend to cover damages paid to a third party or any other person’s vehicle that you have damaged.
Exclusions to this are obvious, as TPL does not cover anything in a taxi or limousine (owned by you); does not cover vehicle replacement, loss to theft, fire or any damage from other than collision) or other damages not resulting from a collision).
The policy is also meant to extend to other damages of the vehicle. An important injury not covered is to the paying passengers since this oftentimes requires the additional cost of a separate policy rider.
2. Comprehensive Commercial Insurance
Among all options, this is the sensible option for taxi or limousine operators. This option melds TPL with coverage for the business's most critical asset: the vehicle.
What It Covers. This policy covers everything included in a TPL with the addition of the following:
Own Damage. The policy covers the cost of repair to your taxi or limousine after an accident, regardless of fault.
Theft and Fire. This policy compensates an insured business for the vehicle's value if it is stolen or if the vehicle is destroyed by fire.
Vandalism. This policy covers damage resulting from malicious actions.
Why It’s Better For Business. A comprehensive policy provided by insurance experts ensures that an accident doesn't financially cripple your business. Rather, a vehicle, income-generating asset, is repaired to be operational. You don’t have to pay out of your business's cash flow.
Key Differences from Standard Car Insurance.
It is important to note that a commercial policy for a taxi is not a personal policy with a higher price tag. The structure and the terms are not the same.
Standard Personal Insurance.
Taxi and Limousine Insurance.
Vehicle Use.
Social, domestic, and pleasure.
Hire and reward (carrying paying passengers).
Premium Cost.
Lower, based on personal risk factors.
Significantly higher, reflecting increased mileage and liability risk.
Driver Clause
Drivers should be considered named along with owners of the companies and their families.
Oftentimes should be “Any Authorized Driver” with a valid commercial license.
Passenger Liability
Only limited to non-paying passengers as there is no coverage.
Paying passengers are excluded unless specifically included.
Deductible (Excess)
Usually the same as standard rates $\$ 500$ to $\$ 1000$ but.
Can be higher due to claim frequency with is increased.
Loss of Use
Is a minor inconvenience and.
Is a direct loss of business income.
The most important one is the “Use” clause. Insurers will make it void if an insured person uses a vehicle meant for personal use as a taxi. If an accident occurs with a paying passenger, the personal insurer is entitled to wholly deny the claim which will leave the person to pay their own costs for it.
Essential Add-ons for Taxi & Limousine Policies
Adding tailored ones for the business should be an even more important comprehensive policy which should be the basis of it.
Passenger liability cover.
This overdue to its importance should be the first one added. It goes beyond the third party liability passengers, who are outside your vehicle, because it will cover the paying passengers injured within the vehicle. It is an enormous legal and financial risk to operate without it in a country like Qatar where passenger safety is of utmost importance.
2. Loss of Income / Loss of Use Cover
Every single day of repair is a day lost. This addendum allows a cash benefit for a limited number of days based on how long the vehicle is being repaired after a claim. This addendum allows you to balance out the fixed costs, lost revenue, and protect the business’s bottom line.
3. Enhanced Roadside Assistance
Basic roadside assistance is one of the pieces of coverage most people need, however, commercial operators need a little more. For roadside assistance, see if the policy has some of these: priority roadside assistance, classes for heavy duty towing (especially for larger limousines or vans), and policies designed for the commercial use of the vehicle.
4. GCC Cover
For Limousine Operators who cater to the region, especially to Saudi Arabia or the UAE, there is a necessary extension to cover GCC. This covers you for the relevant policy, comprehensive and passenger liability, along with ICC and borders.
Tips for Choosing the Right Insurance Policy
Making the right choice is more than just the cheapest. Your business operations must undergo a tactical overview.
Assess Your Fleet’s Value: For a fleet of brand-new limousines, comprehensive insurance with agency repair is non-negotiable. For a fleet of older taxis, a comprehensive policy without agency repair might be more cost-effective.
Personalize your Risk Profiles: Differentiating your company’s taxi service exposure risks as compared to a pre booked airport transfer service makes analyzing your claims experience easier. Discuss risk exposures that are specific to your business activities with your underwriter to ensure that your policy is aligned with your business operations.
Select a Suitable Insurer: Identify an insurance company with sufficient experience insuring commercial vehicles in Qatar. Evaluate the company’s reputation to see whether they value speed and fairness in the claims process.
Don’t Underinsure: Under insurance is a serious risk in the event of a major accident with multiple injuries. Paying an extra premium is likely to be a wise decision.
Get a Professional Insurance Broker: A market expert in commercial insurance contracts is highly likely to assist you in utilizing your existing policy to its full potential. They can assist you in refining your requirements to one underwriter and therefore ensure that you have a captive audience.
Overly restrictive policy conditions: Lack of insurance can be as dangerous as an inadequate insurance policy. Avoid these common mistakes.
1. _Underinsuring to Save Money_
Declaring a lower value for your vehicles to get a cheaper premium is a classic mistake. Insurers will use the “Average Clause” in the event of a claim. If you insure a vehicle for only 70% of its true value, you will only get 70% of any claim, and will have to pay the 30% yourself.
2. _Overlooking Passenger Liability_
Assuming your standard comprehensive policy automatically covers paying passengers is a dangerous oversight. Always confirm that you have a specific extension for passenger liability.
3. _Ignoring the “Use” Clause_
If your policy is for “Limousine Services” (pre-booked), you cannot legally use the vehicle for street hails like a regular taxi. Make sure your declared use on the policy is exactly the same as the one on your operational license from Mowasalat (Karwa).
4. _Failing to Understand the Deductible_
Be clear, because in this industry some policies have higher deductibles for certain types of damage, or if you have a younger driver. Make sure you know how much you will pay out of your own pocket for each claim.
Conclusion: Insuring Your Business's Prospective Future
In Qatar, the taxis and limousines industry faces an imperative demand for situational resilience and sustainable longevity insurance. Given the industry model high vehicular mileage, obstacle business model, and closer engagements with the public and interactions the high consideration of amount substantial risk the business must retain a significant focus concerning the public, and, of course, in case of the business-dependent vehicle.
Though commercial insurance has high premiums and may feel economically high risk, consideration employers must internally based the magnitude of risk on the trade's premium overall. Business risk of a basic TPL policy or other standard comprehensive plans without the essential business consideration add-ons is severe. Therefore, in risk management, the potential liability risk for each individual passenger alone or a single month of lost income from an accident is significant.
Acquiring risk management from comprehensive insurance with passenger liability is streamlining procedure. Therefore in event of common controls for their business to manage minor inconveniences, risk can be shored. Insuring risk with insurance allows business operators minor inconveniences without risk of accidents threatening intact business.
