A (now former) Uber driver is pursuing legal action after both his insurance company and Uber have abandoned him following a car crash while delivering a passenger.
If you’ll recall, we explored options available to crash victims if this ever happened. We didn’t consider options available to the driver because we assumed that he had appropriate auto insurance, not to mention Uber’s promise of $5 million in insurance coverage. Well, both have failed him and the driver may be looking to sue.
How could his own insurance company abandon him? It’s as simple as, apparently, not telling his insurer that he was an Uber driver. By law, insurers of personal use driven automobiles may deny personal car insurance claims if that car is used to transport paying customers.
What about Uber and its supposed $5 million insurance safety net? They haven’t commented on this case, but a brewing lawsuit suggests all is not what it seems.
Photo by Dirke Heine via CC BY-ND 2.0
What may be causing friction in this case is the issue of accident benefits, which is compensation that can be accessed immediately regardless of who is at fault and includes things like income replacement and medical expenses. All Ontario automobile insurance policies contain provisions for certain statutory accident benefits. However, certain accident benefits (including income replacement) can legally be denied in a number of different circumstances, including carrying passengers for hire without telling your insurer.
This is a unique situation that seems to be the result of miscommunication and misinformation in the unclassified (at least in Toronto), blooming new industry that Uber dominates.
As it stands, unprepared Uber drivers are currently more at risk than both their passengers and traditional taxi-cab drivers. Regular taxi cabs are insured under commercial fleet policies, with their insurers clearly aware that the vehicles are being used as cabs, so this issue wouldn’t happen in a Beck cab.
As for Uber passengers, we’ve explained the options available if the insurance of both their driver and Uber fails. If you’ve been in a car accident, call us at 416-533-7133 for a free consultation.
