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Calgary warns of risks as UberX launches in city


October 16, 2015   by Canadian Underwriter


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The City of Calgary is urging caution after being advised on Thursday that private for-hire vehicle company UberX intends to commence offering its service in the city, in breach of a bylaw.

Uber chose to launch its service in Calgary before city council “had an opportunity to consider any options,” the city said

“The City advises citizens that there are risks associated with participating in private for-hire vehicle services such as Uber,” the city said in a statement. “These risks include the fact that the vehicles are not inspected by the City and the drivers are not licenced by the City. There is also a risk that drivers, passengers and any third party involved in an accident with one of these vehicles may not receive insurance coverage or may receive only limited coverage.”

The city said that on Oct. 5, Council directed administrators to report to the Nov. 16 Strategic Planning Meeting of Council with options to consider regarding regulating Transportation Network Companies such as Uber, which provide on-demand transportation services for a fee.

“Despite this direction from Council, Uber has chosen to launch its service in Calgary before Council has had an opportunity to consider any options,” the statement said.

While Marc Halat, manager of compliance services with the City of Calgary, said that the city welcomes “options that meet the needs of our citizens and that offer them the ability to get around quickly and efficiently,” he added that “citizen safety is the primary objective as the City works to provide transportation options that meet the needs of Calgarians and our visitors.”

Until such time that Council considers options and decides if and how to regulate private for-hire vehicles, the statement said, the current Livery Transport Bylaw will remain in force and the operation of private for-hire vehicles will remain a breach of the bylaw. Drivers who contravene the existing bylaw face fines of up to $1,500 per offence under Sections 25, 26 and 27 of the bylaw.

The bylaw ensures that taxi and limousine drivers undergo criminal checks, receive training, and are properly licensed and insured, the City said in a separate statement. In addition, vehicles are subject to thorough inspections rated on both mechanics and appearance, and meters are checked for accuracy.

“Regulated taxi and limousine drivers are required to have commercial auto insurance that ensures both passengers and drivers are safe and covered if an accident were to occur,” the statement said. “It is important that citizens and drivers of private for hire vehicles understand the implications currently involved in utilizing such services. Using or driving one of these vehicles could mean you don’t have access to insurance protection and accident benefits under Alberta law.”

On July 27, Alberta’s Superintendent of Insurance issued an advisory notice on ride-sharing services and the “insurance risk they currently pose to Albertans. The Superintendent of Insurance is of the view that Uber’s supplemental insurance policies do not currently meet the requirements of Alberta’s Insurance Act and regulations,” Superintendent Mark Prefontaine wrote in the advisory, noting that he found “significant issues with regulatory compliance.”

More recently, in September, the City of Edmonton proposed a new Vehicle for Hire Bylaw that would allow technology-based dispatchers such as Uber to operate in the city, while also seeking to maintain a competitive traditional taxi sector.