Insurance for Uber Drivers: What You Need to Know

February 23rd, 2016  |  Auto Insurance

what to know about insurance if you drive for uberIn an age where scrappy grassroots companies routinely go from mom’s basement to billion dollar powerhouses, Uber has managed to top the list as quite possibly the most disruptive tech company around.

By creating a cheaper, faster, and more savvy model for the vehicle-for-hire business, Uber has in a very short period of time paved the road for the traditional taxi service’s funeral procession. If you want to know about insurance for Uber drivers, here are the basics:

You are violating the law

I am sure there’s no surprise here if you’re an Uber driver. Personal auto insurance policies (the kind that most Uber drivers have due to their lower cost) DO NOT apply if you use your vehicle as a source of income.

That means you are technically driving around with insufficient coverage, putting not only yourself, but also your passengers, at risk. While some companies outright ask whether you intend to drive with a ride-sharing service, the majority simply assume you are aware that personal insurance only covers non-commercial use.

Aside from invalid insurance, the other issue of legality comes from municipal bylaws. While Uber as a company is allowed in Canada, the service itself is subject to the rules and regulations set out by individual municipalities. Breaking a bylaw is just as much of a criminal offence as breaking other laws.

The good news, though, is that things might be changing.

Fully approved insurance for Uber drivers is on its way

Aviva Canada has already launched a ride-sharing coverage option for their personal insurance policies in Ontario, and they’re pushing hard to open that coverage up to Albertans in time for March 1 when Uber drivers in Edmonton will finally be able to operate legally, thanks to the city’s recently updated taxi and ride-sharing bylaws (assuming they use Aviva’s insurance).

Aviva isn’t the only company working on cornering the ride-sharing insurance market. Intact turned some heads last year when it announced that it was working with Uber to develop an insurance solution to its drivers. However, we’ve yet to hear more from either Intact or Uber about what their policy will look like or when it will arrive.

However, it’s possible that insurance for Uber drivers is very likely in the works.

Commercial insurance for Uber drivers

Right now, taxi drivers fall under the category of commercial vehicles. As a result, people who drive them must insure them as commercial vehicles. Commercial auto insurance comes at a much higher price point than personal insurance. For most Uber drivers, paying for commercial insurance would be an impractical cost. However, since affordable, tailor-made ride-sharing insurance has yet to become widely available, the only option for most Uber drivers is to get commercial auto insurance.

Uber still has your back… maybe?

Uber isn’t very up front with the public about what their own insurance covers. On their website the most I could find on it was the simple statement basically saying not to worry about it because they got you.

“In the event of an accident during an uberX trip, ridesharing partners are covered by commercial auto insurance in addition to any insurance coverage maintained by the driver-partner.”

Sounds reassuring right? They’ve got plenty of money. Of course they will support their drivers. Unfortunately, they don’t have a spotless track record for how they treat their drivers when it comes to insurance claims.

If you’re an Uber driver, you should make sure to get the right coverage whether that means commercial coverage or Aviva’s ride-sharing add-on.

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