Alberta develops insurance policy for riding-hailing companies such as Uber

The ride-hailing app Uber is shown on a smartphone, May 14, 2015. (Ryan Remiorz / THE CANADIAN PRESS)

EDMONTON -- Alberta has rolled out the details on how it will regulate ride-hailing companies such as Uber Canada and TappCar to ensure they are safe for consumers.

The government has developed a type of insurance policy that companies can purchase to cover their drivers as part of the requirements they must meet to operate in the province.

The policy, to be available to insurance companies on Friday, is designed to cover drivers from the moment they log onto their company's mobile app to pick up a customer.

"I think that this is providing a very good approach to ensure the safety of the public and to ensure a level playing field with other car-for-hire types of businesses," Transportation Minister Brian Mason said Tuesday.

Two insurance companies are expected to offer similar policies for ride-hailing firms later this summer.

A government release said Alberta is the first Canadian province to develop a new insurance policy designed specifically for ride-hailing companies to protect people in the event of an accident.

The policy would provide up to $2 million in third-party liability insurance, with optional collision or comprehensive coverage.

Drivers must also undergo a detailed police check to ensure they are safe to drive vulnerable people such as seniors, people with disabilities or children, and must obtain a Class 1, 2 or 4 licence.

Alberta-based TappCar, which has about 300 drivers in Calgary and Edmonton, said it supports the government's policy.

"We applaud the provincial government for putting the safety and security of Albertans first," company spokesman Pascal Ryffel said in a statement.

"We are particularly pleased that vulnerable sector checks will be written into the legislation."

Ryffel said TappCar already requires such background checks for drivers.

Uber, which suspended operations in Edmonton in March and in Calgary last November, said it wants to study the detailed regulations before commenting.

"We recognize the steps taken by the Alberta government and we will be reviewing the newly approved ride-sharing insurance policy and other announced rules," Jean-Christophe de Le Rue said in a statement.

Mason said the government consulted with ride-for-hire companies, insurance companies and municipalities in developing its plan.

It will be up to the companies to ensure that drivers are up to standard. The firms will face audits to ensure they are complying with the rules.

Companies that fail to follow the rules can be fined up to $50,000 per offence per day.

Alberta's NDP government passed Bill 16 in the spring as part of an overhaul of its Traffic Safety Act and finalized the details of the regulations this month.

When the legislation was introduced, Mason said people who want to use an app to hail a ride-for-hire company need to know that the driver does not have a criminal record, is capable behind the wheel and is covered by insurance if there is an accident.

Mason said he isn't sure if the details announced Tuesday will lead to more companies operating in Alberta.

"I think this is something that sets a clear floor for what we expect in terms of protecting the public and I will see what happens in the marketplace."