What Is the Difference Between Own Goods and Hire & Reward Insurance?

If you operate an HGV or commercial vehicle, one of the questions you may be asked when arranging insurance is whether the vehicle is used for Own Goods or Hire & Reward.

The difference is important because it describes how the vehicle is being used and helps insurers understand the nature of your business.

At Avis Insurance, we specialise in arranging truck and haulage insurance and can help make sure your policy reflects the work you actually undertake.

What is Own Goods insurance?

Own Goods use generally applies when a business uses its vehicle to carry goods or equipment belonging to that business as part of its normal activities.

For example, this could include:

• A builder carrying their own tools and materials
• A manufacturer delivering its own products
• A plant company transporting its own machinery
• A business moving stock between its own premises

The important distinction is that the business is not operating as a haulier carrying other people's goods for payment.

What is Hire & Reward insurance?

Hire & Reward use generally applies when you carry goods belonging to other people or businesses in return for payment.

This is the type of use normally associated with professional haulage operators.

For example, if a customer pays your business to collect a load from one location and deliver it to another, you would normally be operating on a Hire & Reward basis.

This could include anything from general haulage and pallet distribution to container transport, refrigerated haulage or work undertaken for major distribution networks.

What if I carry both my own goods and other people's goods?

It is important to tell your broker or insurer exactly what your business does.

If you sometimes transport your own goods but also undertake paid haulage work for other businesses, this needs to be taken into account when your insurance is arranged.

You shouldn't assume that insurance arranged solely for Own Goods use will automatically cover you when carrying somebody else's goods for payment.

If your business activities change during the policy year, you should also tell your broker so that they can check whether your existing cover remains appropriate.

Is Hire & Reward insurance the same as Goods in Transit insurance?

No. This is an important distinction.

Hire & Reward describes the use of the vehicle for carrying other people's goods for payment and is relevant to your motor insurance.

Goods in Transit insurance is concerned with the goods you are carrying and your potential liability if those goods are lost or damaged.

A professional haulier may therefore require both appropriate Hire & Reward motor insurance and Goods in Transit insurance.

Goods in Transit cover can be arranged on different bases depending upon the work undertaken and the contractual requirements involved, including cover relating to RHA Conditions, CMR or All Risks.

Avis can arrange Goods in Transit insurance alongside your vehicle or fleet insurance, helping ensure the different elements of your haulage insurance programme work together.

Does my Operator's Licence make a difference?

The distinction between carrying your own goods and carrying goods for other people is also relevant to goods vehicle Operator's Licences.

A Restricted Operator's Licence generally allows an operator to carry their own goods in connection with their business.

A Standard National Licence allows operators to carry their own goods and other people's goods for hire or reward within the UK, while a Standard International Licence also permits international operations, subject to the relevant requirements.

Your Operator's Licence and your insurance are separate matters, so having the appropriate Operator's Licence does not by itself mean you have the correct insurance cover.

What insurance does a haulage operator need?

There isn't a single insurance arrangement that's right for every haulage business.

Depending on your operation, you may need to consider:

Truck or Fleet Insurance – covering the vehicles you operate with the appropriate business use.

Goods in Transit Insurance – covering your potential liability for customers' goods while they are being transported.

Public Liability Insurance – providing protection against certain claims from third parties arising from your business activities.

Employers' Liability Insurance – generally required where you employ staff, subject to limited statutory exemptions.

You may also require additional covers depending on your operation, contracts and destinations.

New to haulage?

If you are starting a new haulage business, the terminology surrounding Own Goods, Hire & Reward, Operator's Licences and Goods in Transit insurance can initially seem complicated.

This is one of the advantages of dealing with a broker that specialises in the haulage industry.

Avis Insurance has been arranging insurance for truck and haulage operators for over 40 years. We can discuss how you intend to use your vehicles, the goods you carry and the contracts you undertake before approaching suitable insurers.

Need advice on Own Goods or Hire & Reward insurance?

If you're unsure whether you need Own Goods or Hire & Reward cover, speak to the Avis Insurance team.

We arrange insurance for owner-drivers, individual trucks, new haulage businesses and established HGV fleets throughout Great Britain.

Call us on 01628 662666 or contact us for a quotation.