Why PHV Insurance is so expensive in London

Private Hire Vehicle (PHV) insurance is a legal requirement for any Uber driver in London. But if you’ve ever searched for cover, you’ve probably asked yourself: why is it so expensive? 

Annual premiums for PHV insurance range from £2,000 to £5,000 depending on the insurance provider. This makes it one of the biggest ongoing costs for PCO drivers, especially for our 'New to Uber' drivers. The question many drivers ask us is "what is driving these high prices?", and "is there a more affordable way to get covered?". 

PHV insurance costs in London can be confusing so we’ve broken down the main reasons why it is so expensive. Once you understand the costs, you can make an informed choice around which PCO vehicle solution is right for you. By bundling your vehicle and ongoing costs into a weekly payment plan, like with Splend’s Flexi Own plan, you can save thousands each year. 

What is PHV Insurance? 

PHV insurance (also referred to as private hire or taxi insurance) is a specialist policy required by Transport for London (TfL) for all PCO-licensed drivers. It covers the vehicle, driver, and passengers while driving for ride-hailing services like Uber, Bolt, Ola and FreeNow. 

Standard car insurance is not enough for these drivers as it does not cover commercial use or protect you from passenger-related incidents. That’s why TfL requires all Uber drivers to hold PHV insurance from an approved provider before accepting trips. 

If you're new to the industry and wondering how to get PHV insurance, the process can feel complex and expensive. That’s why many drivers are now turning to vehicle solutions that include insurance from day one. 

Why is PHV Insurance so expensive in London? 

A few key factors make PHV Insurance costs in London particularly steep are: 

• The "High risk" label: Insurers see PHV drivers as "high-risk" since they spend so much time on the road. This increases their chances of getting into accidents. 

• Restricted insurer panel: London Uber drivers must choose a policy from TfL-approved insurers. This limited market restricts competition, often leading to inflated premiums.  

• City congestion: Heavy traffic, tight parking, and dense road networks raise the likelihood of minor collisions and claims. 

• Claim frequency and fraud risk: London has higher rates of insurance fraud and accident claims than most other UK regions. 

The hidden costs of purchasing PHV Insurance separately 

Buying your own PHV insurance might look cheaper at first, but many Uber drivers don’t realise how quickly the extra costs add-up. Here’s what often gets missed: 

• Maintenance and Repairs: Unexpected vehicle issues can lead to hefty bills not covered by standard insurance.   

• Administrative Hassles: Managing separate payments for insurance, servicing, and other necessities can be time-consuming and stressful.   

• Downtime Costs: Without a replacement vehicle, you lose out on potential earnings any time you take your vehicle in for necessary maintenance or servicing.  

The Smarter Alternative: Splend’s All-Inclusive Flexi Own Plan 

At Splend, we simplify PHV insurance for Uber drivers. Our all-inclusive PCO car subscription gives you everything you need to get on the road and start earning — from a PCO-approved electric vehicle to PHV cover, servicing, and support. 

That means no unexpected bills, no downtime, and no admin stress. You make one weekly payment that includes: 

• PHV insurance (Damage & Loss cover with one of Uber’s approved partners) 

• PCO vehicle licence renewal, MOT, and tax 

• Servicing, scheduled maintenance, and repairs 

• Tyre and brake replacement from everyday wear and tear 

• 24/7 support and breakdown cover 

Take Mo, for example, he drives a Mercedes-Benz EQB through Splend's Flexi Own Plan. His single weekly payment covers the car, PHV insurance, maintenance, and support. With Uber Comfort and Green access, he earns more and spends less time managing admin. 

“I used to worry about insurance renewals, MOTs, and breakdowns every few months. With Splend, everything’s covered. I just drive, earn, and save.”  — Mo, London Uber driver, Mercedes EQB on Splend’s Flexi Own plan 

If you are looking at PCO car hire or rent-to-own options with insurance, Splend is your simple solution. We are here to help you start earning from the second you get onto the road. 

Why Private Hire Drivers Choose Splend 

Drivers who switch to Splend often say it’s the peace of mind that makes the biggest difference. With everything bundled, from PCO insurance to vehicle servicing, you spend less time worrying about the paperwork and more time behind the wheel. Our team also helps you with any Uber account questions or vehicle specific queries you have, making us the PCO experts of London Rideshare. 

Frequently Asked Questions about PHV Insurance in London 

• How much is PHV insurance in London for Uber drivers? PHV insurance in London typically costs between £2,000 and £5,000 per year, depending on your driving history, vehicle type, and coverage level. First-time drivers often face higher premiums due to limited experience and insurer choice. 

• Why is PHV insurance more expensive than standard car insurance? PHV drivers spend more hours on the road, operate in high-risk areas, and carry paying passengers — all of which increase the likelihood of accidents and claims. This added risk makes PHV cover significantly more expensive. 

• Can I use my personal car insurance for Uber driving? No. TfL regulations require all Uber drivers to hold a PHV insurance policy that covers hire-and-reward use. Personal insurance does not provide the correct level of cover and will not meet TfL’s requirements. 

• Is PHV insurance included with a Splend car? Yes. All Splend Flexi Own plans include PHV damage and loss cover from a TfL-approved insurer. It’s bundled with your weekly car payment, so there’s nothing extra to manage or pay. 

• What happens if I need to make a claim with Splend? If your car is damaged or needs repairs, our team helps you get back on the road quickly. We’ll coordinate with the insurer, arrange repairs, and, where available, supply a replacement vehicle so you don’t lose out on income. 

• Is PHV insurance cheaper for electric vehicles? In many cases, yes. Electric vehicles tend to have lower repair costs and may be seen as lower risk by some insurers. Plus, driving an EV unlocks lower running costs and additional incentives like Uber’s Clean Air Plan. 

• How can I reduce my PHV insurance costs? Drive safely and maintain a clean history, choose an EV or hybrid vehicle, bundle your insurance with your car subscription and avoid small claims that could raise your premium. 

• What’s the best way to get PHV insurance if I’m a new Uber driver? The easiest and most cost-effective way to get insured as a new driver is through an all-inclusive PCO car hire plan. Services like Splend provide a fully electric, Uber-ready vehicle with PHV insurance already included — helping you get started faster and avoid upfront costs. 

The Bottom Line 

PHV insurance in London is expensive - but it doesn’t must be a roadblock. 

With Splend’s all-inclusive car subscription, you get more than just insurance. You get a reliable EV, zero upfront costs, and everything you need to start earning - all in one simple plan. 

If you're looking to avoid finding your own private hire insurance, or you're comparing PCO car hire with insurance in London, Splend gives you the cover, car, and confidence to succeed.