UberX Drivers in Canada expected to have Commercial Insurance

UberX drivers using personal policies while operating as a paid ride-
share operative are breaking the law and need to check with their
insurance providers to ensure they have appropriate coverage,
suggests Shop Insurance Canada.
“If a vehicle is used for any kind of business, insurance companies
will expect customers to take out a commercial auto policy,” notes a
statement Wednesday from the company, which offers an online
auto insurance quoting tool.



“Drivers working for UberX and using their personal auto insurance
are not properly covered in the event of a collision or other incident.
By the Ontarian and Canadian law, these drivers should be operating
with commercial coverage.”
The rise of Uber and other ride-sharing services has shone a
spotlight on commercial auto insurance coverage, notes the Toronto-
based company.
“It is often the case that customers are not completely clear on the
rules of when a vehicle should be covered by a commercial policy.
This leads to people just sticking with their personal policy, which
can end up being a costly risk,” the statement notes, pointing out
that insurers will “not pay out a claim on a personal policy if the
driver is found to have been using the vehicle for business, or the
driver was an employee of a company.”
Related: Nearly two-thirds of Canadians say Uber should have same
regulations as taxi industry: Angus Reid survey
Shop Insurance Canada notes that vehicle owners falling into the
following criteria are almost certainly in need of commercial auto
insurance:
the vehicle is used to collect or delivers goods, supplies,
food or messages;
the vehicle is used as a method to take passenger for pay
(including ride-sharing companies such as Uber and Lyft);
a vehicle is customized with equipment or goods that
directly support a business, such as permanent tool boxes,
winches and food boxes;
the vehicle is owned by a business or registered to a
business; and
employees are allowed to drive the vehicle for business
purposes.
Uber’s launch in a number of cities across the country had raised
concerns around insurance coverage and protection for drivers and
riders alike.
The Alberta government has introduced new rules to regulate ride-
hailing companies like Uber. Among other things, drivers will need a
professional Class 4 licence, as well as either commercial insurance
or a new insurance policy tailored to the industry.
The position differs from that taken by Saskatchewan, where the
government announced this past March the province would not be
creating special regulations for ride-sharing companies. And earlier
this month in Toronto, city council approved new rules for taxis and
UberX, thereby allowing regular drivers to pick up passengers
without a taxi licence, although both types of drivers must get $2
million in liability insurance.