Changes to ‘point to point’ industry compulsory third party (CTP) insurance premiums

notice | 22/01/2019

In 2019, the way insurers calculate and collect CTP premiums for taxis will change.

The SIRA Board approved changes that will see taxi CTP premiums calculated on the same basis as other comparable point to point hire vehicles, such as rideshare. This means that no premium cap will apply to either taxi or hire vehicle CTP premiums, with premiums calculated on the basis of fare paying kilometres travelled. This change to CTP premium calculation is anticipated to commence during the first half of 2019 to allow time for taxi operators to install fare-tracking technology.

The changes are consistent with NSW Government reforms for the point to point industry that require similar CTP insurance premiums for taxis and comparable hire vehicle services, such a rideshare operators.

Current point to point CTP arrangements

The current CTP arrangements for the point to point industry are a transitional measure allowing traditional passenger services such as taxis to adjust to competition from new market entrants, such as rideshare.

Taxis can currently choose to pay either a fixed annual CTP premium or opt in for instalment payments. Instalment payments are based on actual kilometres travelled whereas the fixed annual premium is based on average annual kilometres. A cap equal to the fixed CTP amount is applied to the instalment payment option.

Comparable hire vehicle services, such as rideshare vehicles, pay a Class 1 CTP premium and a distance CTP component based on fare paying kilometres (rather than total distance travelled). No distance cap is applied in calculating the premium payable. These arrangements have been in place since April 2018.

Read more about how CTP premiums are currently set for taxis and other ride share vehicles.

Changes to taxi premiums by mid-2019

While not yet confirmed, it is anticipated that the move to fare paying kilometre based CTP premiums will commence during the first half of 2019.

This means, taxi operators will pay a small upfront premium and pay an additional monthly premium based on the fare paying kilometres travelled during the prior month. The additional point to point premium charges are 10c per km in metro regions and 6.6c per km in country regions. This is the same basis on which premiums are calculated for comparable hire vehicles, such as rideshare.

A large number of taxi operators are currently in the process of upgrading the old-style taxi meters and installing new taxi mobile apps or similarly capable technology which will facilitate the move to fare paying kilometre based CTP premiums.

The future of point to point CTP arrangements

The point to point CTP arrangements outlined above are transitional and will expire on 1 December 2020. This allows SIRA sufficient time to review industry data and consult with stakeholders prior to finalising CTP arrangements for the point to point industry before December 2020.

SIRA will continue to conduct industry consultations throughout 2019 and 2020. If you would like to be involved, please email