McCarron Coates has sounded a warning to fleet operators by highlighting a series of common oversights that could lead to loss of an O-Licence.
The commercial insurance broker says operators of PSVs are risking more than just regulatory infractions if they fail to maintain robust oversight of their O-Licence obligations.
O-Licence revocation is not only a regulatory risk but a threat to safety, and can lead to legal action and insurance complications, it adds.
To help operators stay ahead of the risks, McCarron Coates earlier this year partnered with JMW Solicitors to launch Accelerate, a fleet protection scheme offering compliance consultancy and legal support.
“How an O-Licence is protected through good practice and control measures is a reliable indicator of how the overall insurance risk is managed, so the two go hand in hand,” says McCarron Coates Director Ian McCarron. “Many operators see the requirement for business interruption insurance, should an unexpected incident force the closure of their premises, but forget that the biggest business interruption they could possibly face would be having the Traffic Commissioner (TC) revoke the licence that gives them the right to operate.
“This is why we have partnered with JMW Solicitors to launch a comprehensive legal protection product that will offer upfront support and legal consultancy and provide the best advice, should a Public Inquiry be faced, or regulatory action signal that this could become a possibility. Prevention is better than cure and that is the ethos of Accelerate, which aims to embed compliance before any issues can arise.”
Common compliance failures
Among the missteps flagged by McCarron Coates is the failure to update licence details in line with changes in business structure — particularly common in family-run operations where ownership may shift between sole trader, partnership, or limited company. The licence must always reflect the current legal status of the entity, with corresponding director information matching that on Companies House. Inconsistencies could prompt scrutiny from the TC.
Another issue is operators failing to reassess the size of fleet permitted under their O-Licence. “Checking that the licence permits the operator to run a fleet of the size currently owned is also imperative,” the firm warns.
Pressure on working capital can affect financial standing calculations. McCarron Coates advises operators to keep capital under review and ensure it is sufficient to comply with the terms of the O-Licence.
Operators should ensure maintenance duties are carried out with respect to DVSA’s Guide to Maintaining Roadworthiness as a maintenance reference.
A warning is given on the use of drivers being employed via their own limited companies. “It is not compliant as you cannot devolve the authority of an O-licence on to others,” the firm says. “Vehicles could be impounded if ltd drivers are used, as the law would require each one to have their own O-Licence. Similarly, any agency agreements should only be made with reputable agencies, supplying drivers to multiple operators, be honest in their intention and not long-term.”
Tachograph abuse, by distributing hours across fewer drivers, and relocating to unsuitable premises without notifying the authorities, are further red flags. In such instances legal exposure would be serious.
