Situation: Sitham bought a new car and comprehensive motor insurance for extensive coverage. Three months later, he decides to sign up as an e-hailing driver. Can he use his existing policy or should he spend more to look for an e-hailing add-on cover?
Referring to the situation, can Sitham use his car for commercial purposes such as e-hailing services? Is there any type of coverage that protects e-hailing drivers? Read this article as we explain further about e-hailing services and necessary coverage.
Can You Use Private Vehicles Insured for E-Hailing Services?
The answer is no. You cannot use private vehicle insured for commercial purposes.
To your knowledge, private car insurance only provides coverage when the car is used for the policyholder’s business. Using your vehicle for anything other than personal use is prohibited.
Your private car insurance does not cover any other usage including commercial purposes such as e-hailing services. If you participate in an accident while using your vehicle for commercial purposes, please note your claim will be rejected due to a violation of your private car insurance policy.
E-hailing add-on for private car
According to the Ministry of Transport, e-hailing drivers must obtain a PSV licence as well as E-hailing insurance when they use their vehicle for e-hailing services. This regulation became effective in 2019.
When you purchase your car insurance or car Takaful, you can add on e-Hailing coverage like to protect you while working as an e-hailing driver.
E-hailing is add-on insurance that you can purchase to give protection when offering such a service. E-hailing add-on provides the drivers’ coverage to minimise legal and financial risks that they might run into. There are several insurance companies that provide e-hailing insurance.
What does the e-hailing add-on cover?
The coverage offered in e-hailing insurance varies depending on the insurers. In general, you’ll get these coverages when your car is on-call and transporting passengers in your car:
- Loss or Damage to your own car
Cover the loss or damage to your car in the event of an accident, fire, or theft.
- Liability to Third Parties
Cover for the loss or damage to a third party for the injury or death caused by an accident resulting from the use of your car.
- Legal Liability to Fare-Paying Passenger
Cover any liabilities incurred by your passengers (while being transported in, entering, or exiting your car) including death or bodily injury.
However, your insurer may not pay in full if the number of passengers in the vehicle at the time of the accident exceeds the legal limit. You need to check with your preferred company. Your insurance provider will compensate you based on the formula below:
- Legal Liability of Fare Paying Passengers for Negligent Acts
Cover for legal liability if any of your passengers participates in an accident involving a third party.
Your insurer will cover you if a passenger receives legal sue for negligent behaviour while riding in your car.
- Accidental injury or death of the authorised e-hailing driver
Cover for your death or injury due to an accident. You are eligible to claim these following compensation (example):
*Note: The amount of compensation may vary across insurers
Make sure to be covered when signing up for e-hailing service
Please note that not all insurance companies offer e-hailing add-on insurance for private cars. Some companies that you can consider looking at are MSIG insurance, Allianz insurance, Etiqa Takaful, Allianz Insurance, etc.
They can be slightly expensive because the car is always on the road. Thus, the risk to get into an accident is higher.
But don’t ever take the risk and drive with regular private car insurance. Make sure you receive the necessary protection.
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