This week an Ontario based UberX driver revealed he would sue the company because it did not cover him after he was involved in an accident while carrying an Uber passenger. Tawfiq Alam found that his personal policy did not cover him and wants to warn other Uber drivers of the insurance dangers from working with the company.
However, what is the insurance secret of Uber, and why is the system so confusing?
It is important for all potential and current Uber drivers in Canada to know that their personal auto insurance does not cover them to drive for the company under any circumstance. It is also important to know that Uber’s insurance model in Canada is always based on a contingent system, which means the company will only get involved if your personal insurance company declines a claim.
Which it definitely will. Under Canadian insurance laws in all provinces a company will not cover a personal insurance policy holder if they operate livery, rideshare, or peer 2 peer transportation activities. Indeed, not only will your insurance company decline cover, it will also almost certainly cancel the policy outright.
Of course, the next logical route would be to simply take out a commercial auto insurance policy which would allow you to use your vehicle as a working car. Uber certainly hints that is the best course of action in its “Transportation Provider Service Agreement.”
- Inform your insurer of the P2P transportation service you provide; and B) ensure that your insurance policy provides coverage for the P2P transportation service you provide.
Uber is doing the right thing by saying drivers should confirm their involvement with the company through their insurance provider. The problem arises when one realises that Uber does in fact still accept personal policies from its drivers in the sign up process, knowing that insurance companies in Canada will not issue policies for P2P transportation.
This means the company accepts people using their personal auto insurance without having declared it, something Uber says its drivers should do in the agreement. In other words, Uber is accepting drivers who it can easily detect are breaching the insurance rules in the agreement. This effectively is laying those drivers out to dry, as they will not get covered by their personal policy and will then not be helped by Uber because they broke the terms of the agreement.
The “Transportation Provider Service Agreement” sums this up as such:
- Failure to secure or maintain satisfactory insurance coverage shall be deemed a material breach of this Agreement and shall result in the immediate suspension of the Agreement and the loss of your right to receive Requests under this Agreement.
We have reached out to Uber to see if the company can offer clarification on this matter, or if it even knows it is accepting Canadian drivers who are instantly in breach of the service agreement.