So you thought it would be a fun venture to start your own party bus rental company. While it can be an enjoyable and lucrative business, and all signs point to the industry as a growth business, there are some essential requirements to take careful note of.
Party Bus Operator Requirements, Rules of the Road
1. Before launching your business, do your homework. Make sure you know your state’s requirements for owning and operating a bus. If you are not hiring a driver and plan on doing the driving yourself, you will need a commercial license with a passenger endorsement if your bus exceeds a certain size based on the number of passengers, which depends greatly on the state you’re operating in. Gaining a commercial driver’s license usually requires a written and road test. Furthermore, there’s more “upkeep” with having a commercial driver’s license. For example, you may be subject to drug testing.
According to the Federal Motor Carrier Safety Administration:
What tests are required and when does testing occur?
Pre-employment – An employer must receive a negative drug test result before permitting a CDL driver to operate a CMV (S 382.301)
Post-accident – Drug and alcohol test may be required after crashes according to the following chart (S 382.303)
After any accident that results in a human fatality regardless if the driver was issued a citation or not.
Bodily injury with immediate medical treatment away from the scene and a citation was issued.
Disabling damage to any motor vehicle requiring tow away and a citation was issued.
Random – CDL drivers must be randomly tested throughout the year.
Reasonable suspicion – Drivers who appear to be under the influence of drugs or alcohol can be immediately tested. Employers must train CDL driver supervisors to detect the symptoms of driver impairment
Return-to-duty – Required for drivers who tested positive, refused, or otherwise violated the prohibitions of 49 CRF Part 382 Subpart B, and who have completed the return-to-duty process with a DOT-qualified substance abuse professional. This test is directly observed, and a negative result is required before resuming driving duties.
Follow-up – Required for drivers who tested positive, refused, or otherwise violated the prohibitions of 49 CFT Part 382 Subpart B, and who have completed the return-to-duty process with a DOT-qualified substance abuse professional, and have tested negative for a return-to-duty test. This testing is prescribed by the substance abuse professional for a minimum of six directly observed tests in 12 months, but can be extended an additional four years.
2. Once you have crossed the commercial license off your list, either because it’s not required, or you have it taken care of, next up is special permits. You will need to look into any parking permits or inspections required to operate legally.
3. Your business will need specific licensing through the secretary of state. During the application process, ask if there are any other licenses required to operate a commercial bus service.
4. Now that you have filed the appropriate paperwork and obtained the proper licensing, you can proceed with the fun part. Buying the party bus. Be sure to shop and tour a few different models to find your ideal vehicle.
5. Lastly, and probably most importantly before a client steps foot on the bus, you will need party bus insurance.
You will need a general liability policy for party bus operators.
General liability insurance protects your business from third party claims (meaning not an employee or officer) for accidental bodily injury and property damage. A typical scenario is a “slip and fall” type of claim, where a guest may sue you for medical bills and time off work.
You are going to need a Commercial Auto policy for party buses as well. A Commercial Auto policy will cover damage to your vehicle as well as damage to the property of others.
Aside from these main coverages, there are other coverages you may need depending on your business. Such as Liquor Liability, Workers Compensation, Garage Keepers Liability Insurance, and Special Communications Equipment Coverage.
If you are ready for the next step in protecting your business, contact us today.
Robert Weinstein is a husband, dad, stock market junkie, real estate broker, and of course…Insurance agent. Interests include my family, economics, marketing, technology, real estate, finance/investing, history, and Asia.
Robert’s insurance expertise includes having the designation of Certified in Long-Term Care (CLTC) and assist in asset protection for families with members entering retirement.
Robert is also an accomplished syndicated writer whose work can be found in TheStreet, MainStreet, CNBC, Forbes, Yahoo Finance, Seeking Alpha, MSN Money, The Money Show, Stock Saints, Motley Fool, Fidelity, Minyanville, RealMoney Pro, and many national and international newspapers.