UberX QuestionsX

Sharing economy services like Airbnb and, more top of mind, UberX, are proving disruptive on a number of levels and for a number of stakeholders.

One such level is insurance, where views differ wildly.

The position taken by Uber that it is a technology company, not a taxi service, is one such point of contention. (A recent Ontario court ruling dismissed Toronto’s bid for a permanent injunction based on its argument that UberX is a taxi company and must adhere to municipal rules.)

At its heart, the question is will claims for drivers and passengers be covered in the event of a collision involving a vehicle booked through the ride-sharing app?

The questions increase in step with the public’s growing appetite for the service. Arguments over insurance what-ifs have gained profile, but it is not yet clear cautions have put the public off its taste for cheaper “taxi” trips.

A new Mainstreet/Postmedia survey – involving 7,323 respondents in Edmonton, London, Montreal, Quebec City, Ottawa and Toronto – shows 45% of surveyed Torontonians and 46% of Montrealers are favourable to UberX compared to 37% and 38%, respectively, who support banning the service.

In general, respondents were divided, but in many cases want UberX and taxis to follow the same rules.

In a separate survey from Probe Research Inc., 60% of the 446 Winnipeg-based members of the company’s online proprietary panel who report being familiar with UberX say the ride-sharing app should be allowed to operate in the city, while 23% oppose such a move.

The sometimes uneven support compares to decidedly more steady warnings from insurance regulators.

For example, the Financial Services Commission of Ontario notes a standard auto insurance policy excludes coverage when the vehicle is used to carry paying passengers or used as a taxi.

The Insurance Brokers Association of Ontario (IBAO) adds there are “a number of myths that suggest insurance coverage would be recognized should an UberX driver or an UberX passenger be involved in a collision.”

IBAO president Michael Brattman says “drivers and passengers should know that there is no existing endorsement for a personal lines policy that is available today that would guarantee them coverage or protection in the event of a collision.”

Out west in Alberta, the Superintendent of Insurance warned this past July that UberX’s insurance policies create “significant issues with regulatory compliance.”

Still, the office is committed “to working with Uber and other ride-sharing services to ensure that Albertans using ride-sharing services have access to insurance protection and accident benefits under Alberta law.”

In September, the City of Edmonton jumped headfirst into the discussion with its proposed Vehicle for Hire Bylaw. Among other things, it would allow technology-based companies that have mobile app dispatch services to operate and would increase the fine for operating without a licence to $5,000.

Other recent developments include the Manitoba government indicating anyone driving for UberX would require a taxicab licence, and British Columbia’s transportation minister saying plainclothes agents with the authority to issue fines of as much as $5,000 are on the lookout for operators of unlicensed, alternative taxi services.

All that said, Intact Financial Corporation has just announced it intends to offer “tailored insurance products” for Uber and is “working closely with insurance regulators and different levels of government in provinces where the ride-sharing service currently exists.”

A commentary late last year by the Competition Bureau notes “these innovative business models have the potential to offer important benefits to consumers through more competition, including lower prices, greater convenience and better service quality.”

Whatever the support, however, questions need to be answered before anyone operating a vehicle through the UberX app (or passengers using the service) can confidently rely on being protected in the event of a crash – or worse.