Law Times

Law Times • OcTOber 17, 2016 Page 9 www.lawtimesnews.com Risks not resolved by ride-sharing insurance BY JUDY VAN RHIJN For Law Times T he superintendent of the Financial Services Commission of On- tario has approved an auto insurance policy that cov- ers all Uber drivers, passengers and vehicle owners in Ontario from the moment the Uber app is turned on to the moment pas- sengers exit the vehicle. This addresses one of the public's biggest concerns with the ride-booking service, name- ly that there was no coverage in the event of an accident. However, risks remain with- out buy-in from Uber drivers' personal insurers. "Typically, when you own insurance as a private citizen, there is a restriction on driv- ing for a fee or in a commercial capacity," says Stephen Birman, partner at Thomson Rogers Lawyers, a specialist in personal injury law. "This standard insurance policy now protects all Uber drivers and anyone injured in an Uber vehicle or pedestrians. It provides standard accident benefit coverage and third-par- ty coverage. Intact says coverage applies across the board to all drivers and FSCO has approved it, so you can be confident it applies when the app is active." The danger arises in the pre- and post-app period when the private insurance should apply but may not. "The problem is that private insurers do not like it when you are using your vehicle for com- mercial purposes," warns Elliott Ambridge, partner at Ambridge Law LLP Personal Injury Law- yers. "They may say they won't cover you at all other times. It comes down to the question of how private insurance compa- nies will react." The ride-booking commu- nity, for which Uber provides a technology platform that matches drivers using their per- sonal vehicles with passengers, now has the equivalent of com- mercial f leet insurance, made possible because of a regulatory change under the Insurance Act to allow for vehicles that can be hired through an online ap- plication. Intact has responded with a policy paid for by Uber that au- tomatically covers drivers. Aviva is also offering cover- age that needs to be purchased as an addition to its personal car insurance. "In terms of passengers not having insurance — and a lot of them don't have personal in- surance, especially downtown in the [Greater Toronto area] — that aspect of the issue is solved," says Kaitlyn MacDonell, a per- sonal injury lawyer at Howie Sacks & Henry LLP. "But people may not be aware that ride-sharing changes po- tential coverage. An insurance policy is based on an assessment of risk. Carrying passengers for payment is an additional risk factor. The potential is there that a personal insurer will take an off-coverage position if a person is driving commercially. There's still a vulnerable population out there." Intact spokeswoman Hazel Tan says, "To our knowledge, there is no industry-wide agree- ment on how to underwrite Uber drivers on a personal auto policy. "Only Intact Insurance, Novex, Jevco and belairdirect have modified their underwrit- ing guidelines to allow for ride sharing on their personal auto insurance policies when there is a commercial policy issued for Transportation network com- pany usage," she says. Birman says it's unknown how other insurers will respond. "Will they rely on the restric- tions? I wouldn't want people to end up thinking they've got great coverage from Uber plus separate private coverage, then their own insurer takes the posi- tion that because they are driv- ing for Uber on the side, they will no longer be given insur- ance in their personal capacity," says Birman. Ambridge says drivers should update their insurers "about material changes in the operation of the vehicle or cir- cumstances. "Driving for Uber is quite important and material. They would consider it fraud if you don't inform them and the courts would support it," adds Ambridge. MacDonell says if an Uber driver or vehicle owner gets into a collision outside the time the app is on, and the private insur- er does not honour the policy, there are limits on third-party liability to $200,000. "A driver may also be person- ally exposed if injured. Accident benefits may be limited," says MacDonell. Birman says this can mean serious consequences for an innocent accident victim with serious injuries, because "$200,000 won't go far, and there's no further recourse against the driver unless they have significant assets." "The insurance company can then claim the $200,000 against the driver," says Birman. "You can purchase a product that protects against insufficient insurance coverage, and most people do. It's a rider for a nomi- nal fee, but some don't buy it." Ambridge also points out that even when there is cover- age, people should consider how difficult it can be to obtain acci- dent benefits and compensation from insurers. "Lawyers are busy because insurers don't specifically cover what they say they will cover," says Ambridge. "It remains to be seen how Uber insurers will react if cases start pouring in. You could complain to Uber, but what they can do in each specific case is questionable." There are warnings on the FSCO website that every driver should check whether their pri- vate insurer will honour their contract if Uber driving is tak- ing place. The Insurance Bureau of Canada also encourages all drivers to make sure their insur- ance companies are aware of the activity. "This is typically one of the questions on an insurance form — the purpose for which the vehicle will be used," says IBC spokesman Andrew McGrath. "IBC encourages all Trans- portation network company drivers to contact their insur- ance representative to make sure they have adequate insurance. In a competitive market, we encourage consumers to shop around to find a policy that meets their unique needs." Birman says someone who rides in Uber vehicles or is aware that there are a lot of Uber vehi- cles on the road should be aware "of the enhanced risks of taking an off-coverage position." "They should also purchase optional accident benefits, espe- cially given recent changes lim- iting benefits. "With the Uber issue out there, there are even greater rea- sons to purchase extra protec- tion," says Birman. Everyone agrees that the most important thing is disclo- sure. "That's the thought that came to my mind — disclosure, disclosure, disclosure," says MacDonell. "The onus is on the driver and owner of the vehicle to dis- close that they are driving for Uber." LT FOCUS Elliott Ambridge says even when there is coverage, people should consider how dif- ficult it can be to obtain accident benefits and compensation from insurers. THOMSON, ROGERS celebrates its 80 th Anniversary by donating $80,000 TF: 1.888.223.0448 T: 416.868.3100 www.thomsonrogers.com Help us decide how to allocate our anniversary fund to organizations who have helped our personal injury clients in their journey of recovery. Go to: thomsonrogers.com Untitled-1 1 2016-10-12 9:49 AM E. V. Litigation & Financial Services Inc. Elaine G. Vegotsky, CMA, CFE, CFI Assisting you in Litigation & Forensic Accounting, Financial Investigations x a F r o e n o h p e l e T 0 0 9 e t i u S 0 7 3 1 - 0 3 9 ) 6 1 4 ( , t s a E e u n e v A d r a p p e h S 5 4 Willowdale, Ontario M2N 5W9 (905) 731-5812 evlitigation@rogers.com E. V. Litigation & Financial Services Inc. Elaine G. Vegotsky, CMA, CFE, CFI Assisting you in Litigation & Forensic Accounting, Financial Investigations x a F r o e n o h p e l e T 0 0 9 e t i u S 0 7 3 1 - 0 3 9 ) 6 1 4 ( , t s a E e u n e v A d r a p p e h S 5 4 evlitigation@rogers.com Toronto, Ontario M2N 5W9 (905) 731-5812 CFA, CPA, Vlit_LT_Mar10_14.indd 1 14-03-04 10:18 AM

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