Louisiana P&C Adjuster Practice Exam

What type of policy would best suit a taxi company?

1. Business Auto Policy

2. Private Passenger Auto Policy

3. Motor Carrier Policy

4. General Liability Policy

The correct answer is: Motor Carrier Policy

For a taxi company, the most suitable policy is a Motor Carrier Policy. This type of insurance is specifically designed for businesses that transport passengers or goods for hire, including taxis, shuttles, and other types of commercial transportation services. It provides coverage for vehicles used in a commercial capacity, offering protections that are not typically included in standard personal or business auto policies. The Motor Carrier Policy would cover various liabilities associated with operating a taxi service, including bodily injury to passengers or third parties, property damage, and other specific risks encountered in the course of providing transportation services. Given the nature of taxi companies, which involve frequent interaction with the public and heightened exposure to risks related to transportation, this policy type addresses their particular insurance needs effectively. In contrast, while a Business Auto Policy can cover vehicles used for business purposes, it may not provide the comprehensive coverage required for a taxi service specifically, as it is generally more suited for businesses that do not transport passengers for hire. A Private Passenger Auto Policy is intended for personal vehicles and would not be appropriate for a commercial taxi operation. Finally, a General Liability Policy focuses on general business risks but does not specifically cover the liabilities associated with vehicle operation, making it insufficient for a taxi company’s needs.