Taking Your Taxi Electric – Should You Switch?

Taking Your Taxi Electric – Should You Switch?

Amid all the talk and chatter about the UK Green Deal and the preponderance of EV charging points now available, is it time to invest in an electric taxi or should you wait and join the clamour for a taxi amnesty until the pandemic crisis eases? If you decide to take the plunge, what effect will having an electric vehicle have on your taxi insurance or taxi fleet insurance?

The march to electrification in the UK motor industry continues apace with the recent news that Jaguar Land Rover is to become an all-electric brand from 2025. But what about those who operate in the private and public hire taxi sectors? Is it inevitable that the taxi sector is to go the same way as home delivery fleets or is it just eco window dressing designed to jump upon a green bandwagon?

Financial Incentives for EV Taxis

Transport for London (TfL) has now installed nearly 6,000 electric vehicle charging points across London as preparations for an expanded Ultra Low Emissions Zone (ULEZ) continue apace. London now has more than 500 rapid charge points and over 5,500 residential charge points, with some points dedicated exclusively to the 4,000 electric hackney cabs operating in the capital.

Interest free loans and sponsored grants for taxi drivers moving to electric vehicles were also announced in the London Mayoral candidate’s new ‘Fresh Start’ plans for the capital. A key part of the plan will be to offer interest-free loans to every single taxi driver with a diesel black cab in London to help them move over to modern electric vehicles.

The plans would also see a further grant of £7,500 handed to every taxi driver towards the cost of purchasing a new zero emissions capable taxi.  

Expanding the EV charging network

The Department for Transport (DfT) announced that the Electric Vehicle Homecharge Scheme (EVHS), which provides up to £350 towards a charge point, will continue next year and will be expanded to target people in rented and leasehold accommodation. It’s available for most electric and plug-in hybrid cars, old or new. You can claim one chargepoint per eligible vehicle and up to two eligible vehicles per household.

A new UK wide government initiative will also target small businesses and offers the separate Workplace Charging Scheme (WCS) grant, which can be claimed by any business, charity, or public authority, and also provides up to £350 off the cost of purchasing and installing charging points, up to a maximum of 40 sockets. 

Charging an Electric Taxi

How much it will cost to charge your taxi varies between home, work and public charging. According to Pod Point EV Charging, for a typical electric car with a 60kWh battery and a 200-mile range, a home charge will cost about £8.40, while a rapid charging point at places such as motorway services will cost approximately £6.50 for a 30-minute, 100-mile charge.

As chargepoints become more prevalent and taxi fleets move towards electric, many companies are investing in charging points at work, which may be a cheaper option. Public chargepoints at supermarkets, hotels or car parks may be free for your stay, but some come with restrictions, such as a minimum spend, so best to check beforehand.

The Cost of Electric Taxi Insurance

Many taxi drivers have shown concern over tabloid newspaper articles stating that electric vehicles could cost up to 50 percent more to insure, though evidence reveals much of this to have been exaggerated.

In general, if you invest in a very expensive vehicle then, like all insurance, your premium will be slightly higher. However, the increased insurance liability risk presented by the electric taxi is minimal and, as the cost of damages awarded to third parties make up most of insurance premiums, this should have little impact. 

It is still early days in the electric taxi insurance market but having a chat with your insurance broker could help to alleviate any concerns before you make the switch. Remember, premiums are dependent on many other factors too including your age, experience, postcode and no claims bonus. As electric vehicles become more mainstream, premiums are likely to be much more comparable to diesel taxis.

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