Cab drivers across the country have been protesting the drive sharing app, Uber. This app turns your phone into a virtual dispatch and payment center, allowing regular citizens to easily offer rides for pay in any city that has enough users to warrant the service.
This opens up a whole new level of competition for cab drivers and some say the Uber drivers have an unfair advantage. Uber drivers are seen to be skirting the law in a number of areas. Below are some of the things that cab drivers must be compliant for that Uber drivers may not be doing.
- Most are driving with a standard class 5 license when cab drivers are required to obtain a class 4 license before offering rides.
- They likely haven't completed and passed a commercial vehicle inspection.
- And they are probably driving with a personal car insurance policy rather than a commercial one.
Am I Putting Myself at Risk By Picking Up a Passenger Through Uber
When you give someone a ride for monetary compensation, you are making a business transaction and therefore operating your vehicle commercially. Because of this you need to now follow regulations for operating a commercial vehicle in your region. Otherwise you might be looking at a hefty fine and demerits against your license if caught.
Does Being an Uber Driver Void My Insurance?
Once you start accepting money for driving passengers from point A to point B, this is deemed as commercial use. Your personal car insurance policy is meant to cover you while you're using your vehicle for personal use. In fact, when you signed your car insurance application you were, among other things, confirming that you are using your vehicle for personal use only.
If you were to end up in an accident and your insurance company finds out you've been operating your vehicle as an Uber driver you could have a problem. Your insurance company may restrict payment of your liability coverage to the minimum required by your province ($200,000 in Alberta). They may also come back and sue you to regain that $200,000.
You could also receive fines from your local law enforcement for operating without sufficient insurance and having improper registration and licensing to operate a commercial vehicle.
UPDATE:
In a CTV interview a representative from the Insurance Bureau of Canada (IBC) has announced that policy holders driving Uber passengers will be denied any liability coverage at all. They will not even cover the minimum $200,000 liability in the event of a claim. They have stated that driving Uber will most certainly void drivers policies unless they have the optional SEF 6 Endorsement added to their policies. This endorsement gives Permission to Carry Passengers for Compensation.
What About Car Pooling
Technically accepting gas money for car pooling could be interpreted as operating your vehicle in a commercial capacity as well. However, since this is likely a more casual, personal relationship that you would have with one passenger. If you're doing this, you may want to check with your broker to ensure that you are safe, but you likely won't run into any issues here.
If you would like to operate as an Uber driver safely and within the law there are a number of considerations for you to take and some expense as well. Here are just a few to get you started:
- Get a Class 4 driver's license.
- Get commercial car insurance for your car.
- Ensure that you have a proper business license.
Many cities have outlawed the service, but some have allowed it with adherance to new regulations. The City of Edmonton has asked that Uber discontinue services in Edmonton until new regulations can be implemented for ride sharing. At the time of writing this article, however, it is still possible to register as an Uber driver for the city of Edmonton on Uber.com.
For more info on commercial auto insurance, click here.
