Ontario approves insurance plan aimed at Uber

Uber riders can rest a little easier en route, says the ride-hailing company, after the province approved an insurance plan Thursday that covers paying passengers.
The plan, approved by Ontario’s insurance regulator this week, ends Uber drivers’ legal limbo. It also makes Ontario the second Canadian jurisdiction after Alberta to give the go-ahead to a policy tailor-made for ride-sharing services, despite ongoing concerns around lopsided regulations and costs for taxi drivers.
The Financial Services Commission of Ontario (FSCO) says the “blanket fleet coverage” by Intact Insurance “removes the exclusion against carrying paying passengers” and addresses a “critical insurance gap” for the industry. The new plan includes third-party liability up to $2 million, according to Intact.
“This new ride-sharing insurance approved by FSCO should serve as a practical solution designed for ridesharing,” said Uber Canada general manager Ian Black in a statement Thursday.
Last week, Intact began offering coverage for Uber drivers in Alberta and both companies are working with Quebec to get ride-hailing insurance in place for private vehicles transporting paying passengers.
“We anticipate that other insurers will do the same, going forward,” the commission said.
The new policy covers all Uber drivers, passengers and vehicle owners — except exclusively UberEats drivers — when the app is in use. When the app is off, the vehicle owner’s personal auto insurance policy kicks into gear.
Not everyone sees the regulatory change as an effective solution.
“This is another bogus, smoke-and-mirrors announcement,” said Rita Smith, executive director of the Toronto Taxi Alliance.
“Those (UberX) drivers are not covered right now. They weren’t covered last night. They won’t be covered by July 15” when a bylaw requiring coverage takes effect.
Uber says it bought the commercial ride-sharing policy from Intact and it applies “automatically” to “every ride-sharing driver.”
Smith, however, says UberX drivers still purchase the policy independently.
“If MLS (Municipal Licensing and Standards) actually gets serious about enforcement and enforces Uber drivers like they do taxi drivers, Uber drivers will leave in droves,” said Smith. “They will be like rats off a sinking ship.”
Philomena Comerford, president and CEO of Baird MacGregor Insurance Brokers, said as it stands, all Ontario UberX drivers are “absolutely on the hook for getting commercial insurance.
“Uber’s non-owned automobile policy covers Uber, not the driver,” she added. “There is no warm and comfy public safety net that I can see here under this policy.”
Intact senior vice-president Karim Hirji insisted Uber, the company, purchases the policy.
“We sell the policy to Uber; Uber pays the premiums,” Hirji said. “No matter who the driver is, as long as the ride is originating on the Uber platform, that ride is covered by our policy.”
Uber requires drivers to buy personal auto insurance from any provider. It’s up to the driver to alert that insurer they’re driving under the Uber banner.
Tracey Cook, the city’s head of licensing, said in an email the city is “pleased that there is a product available that meets our requirements and provides appropriate coverage for passengers and drivers of (private transportation company) vehicles.”
New rules for the fresh class of private transportation companies (PTCs) include a bumped-up base fare for ridesharing, higher standards for PTC certification and the opportunity for taxis to use surge pricing.
The rules are slated for implementation July 15.
Mayor John Tory said he supports the proposed provincial regulations, Tory spokesperson Siri Agrell said in an email.
“As for the whole ‘prove that they have it’ — MLS will have full access to driver records, including insurance certificates,” Agrell said.
She added that staff is recommending council require municipal standards officers be allowed to see “proof of applicable insurance… upon request.”
Since first appearing on Toronto streets in 2012, San Francisco-based Uber has struggled to quell backlash from Toronto taxi drivers and anchor itself in other cities.
Mississauga nearly banned the company outright this year before adopting a ride-sharing pilot program.
A new law in Quebec requires Uber to acquire pricy taxi licenses. The company rolled out of Calgary after the city unveiled stringent regulations early this year. And in March, Uber suspended operations in Edmonton after the city passed regulations requiring broader insurance.
“By modernizing Ontario’s auto insurance system, Ontario is allowing insurers to provide greater peace of mind to ride-sharing passengers and their drivers. The sharing economy has the potential to promote economic growth, productivity and support innovation,” said Finance Minister Charles Sousa in a statement Thursday.