Driving for Uber? Make Sure You Aren’t at Risk!

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If you’ve traveled to any major cities for business or a vacation, you may have tried taking an Uber instead of a taxi. Uber and other ridesharing apps allow qualified individuals to sign up as drivers. Passengers tap on the app when they want to hire a driver, agree to a prearranged fare, and the driver arrives to take you to your destination. While this sounds simple, it can affect a driver’s insurance coverage if they don’t have the correct insurance policy – and leave them liable for high medical and legal bills.

More Ontarians may consider driving for Uber after the company’s launch of a new commuting service, called uberHOP. UberHOP allows commuters to share a ride for just five dollars from Liberty Village, Fort York, City Place, and Distillery District,  neighborhoods in Toronto to the Financial District.

We’ve written about the risks of Uber before, but it’s worth revisiting since some high-profile cases have arisen which demonstrate that driving for Uber is a very risky business; drivers don’t appear to be getting the coverage they were promised from Uber in the event of an accident, and improper insurance can mean they are left paying out of pocket for expenses their insurer would usually cover. This could mean losing all of your savings, home and any other assets if you end up getting into an accident without the proper coverage.

What kind of insurance does an Uber driver need?

In order to be properly covered, anyone driving for a service like Uber requires a commercial automobile policy with a taxi rating – specific insurance which covers the business activity of transporting paying passengers. Many Uber drivers continue to drive their car under their personal insurance, either not knowing or caring that both they and possibly their passengers won’t be covered in the event of a claim.

The case that proves the point – Uber leaves drivers in the dust

A Toronto Uber driver found out the hard way that his personal policy was not enough to cover him in the event of a claim. Tawfiqul Alam’s insurance company denied any benefits based on the commercial use of the vehicle. Despite assurances of coverage from Uber, Alam was not provided with any funds from Uber for his rehabilitation, despite Uber’s assurances that drivers are covered through its own insurance policy, the details of which are not public. Since Alam was the only one with an injury in the case, he is only responsible for his own costs. But what if there had been more injuries?

Read more about what a Toronto lawyer has to say about Alam’s case.

Uber unresponsive in Canadian potential insurance claims

There is literally no recourse except the courts for an Uber driver who has been denied a claim. Alam was considering suing Uber, and this is really all he can do. Uber is a large tech company with millions of dollars at its disposal for lawyers, while the majority of its drivers are people looking to make some extra money – and typically not people who can afford high-powered lawyers.

Uber does not have a good track record with drivers who try to make claims – this article recounts the experience of another Toronto Uber driver who contacted Uber about a minor accident. The Uber app stopped working right away for the driver and he didn’t receive a response from Uber.

Bottom line – get the right insurance if you drive for Uber

If you are “caught” by your insurance company driving a personal vehicle commercially, one of the consequences could be a voiding of the policy. This would make it very difficult and costly to become re-insured, as insurers will consider you to be more of a risk since you essentially lied on your initial policy about the vehicle’s use.

Uber is here to stay; drivers should ensure that they have the correct coverage on their end and not blindly trust Uber to handle everything if they should get into a serious accident. Uber drivers could stand to lose everything if they are involved in an accident and are not properly insured.

If you are interested in a quote to ensure you are properly protected as an Uber driver, you can contact Christine Dokis Toll Free at 800-263-5950, directly by phone or text at 705-472-5901 and email christine@kennedyinsurance.ca.