January 16, 2018 by By The Canadian Press
The ride-hailing company Uber is considering giving Winnipeg a pass over concerns about insurance rates its drivers may have to pay to operate.
In a submission to Manitoba’s Public Utilities Board, Manitoba Public Insurance is proposing four different rate options that would see Uber drivers pay 5% above their all-purpose coverage.
The provincially owned insurance company says the rate model is fair, gives drivers choice and prevents other vehicle owners from subsidizing Uber vehicles.
But Uber argues such a policy could be cost prohibitive for some drivers and says unless a blanket insurance model is chosen it won’t offer its service in Winnipeg.
The city and provincial government have previously paved the way for ride-hailing companies to start March 1, 2018.
The city’s cab industry has been critical of the decision, saying Uber drivers will pay lower rates and create an unfair playing field.
MPI’s proposal says rates for ride-hailing drivers would be different depending on the time of day the operator wants to pick up passengers, or whether it’s on a weekday or weekend.
Uber’s submission to the utilities board says those time bands could be cost prohibitive for drivers who work part-time only.
“Based on the deficiencies in the MPI proposed product versus the type of insurance that is available to ridesharing companies in cities across North America, Uber will, unfortunately, be unable to consider expansion of services to Winnipeg on March 1, 2018.” wrote the company.
Uber rival, Lyft, said in a statement to CTV that it also has serious concerns about the insurance proposal.
“We don’t believe it would allow true ridesharing to operate in the province. We look forward to continuing to work with the Manitoba Public Insurance Corporation to find a way forward that expands Manitobans’ access to affordable, reliable transportation options like Lyft.”
MPI, in a statement to the same network, said the proposed insurance rates for private vehicle-for-hire operators is consistent with other jurisdictions.
“The proposed insurance model ensures that vehicle-for-hire operators are insured in a separate insurance class that will prevent cross-subsidization of loss experience with other major vehicle classes. Under the model, there is flexibility for vehicle-for-hire operators to select specific time bands in which they intend to provide for-hire services,” said the Crown insurer.
Manitoba Opposition NDP Leader Wab Kinew, who has backed the cab industry and its concerns, said MPI’s rate application is reasonable.
“It seems a little surprising that Uber is saying things aren’t fair when they’re being offered the chance to operate in Manitoba for something like 25% of what the taxi industry has to pay to do business here.”
A board decision on MPI’s application is expected Monday.
This story was originally published by Canadian Insurance Top Broker.