Auto insurance provider working with Uber on ridesharing options
Published Tuesday, September 8, 2015 7:28AM EDT Last Updated Tuesday, September 8, 2015 12:27PM EDT
TORONTO -- One of Canada's largest auto insurance providers is teaming with Uber to create products tailored for the ride-hailing service, after concerns emerged that some insurance policies may not cover drivers using their personal vehicles for commercial gain.
Intact Financial Corp. (TSX:IFC) said it is also working with insurance regulators and various levels of government in provinces where Uber is available to ensure the products that it develops are in line with regulatory requirements.
The insurer said it was too early to provide details about the products, which it plans to market under the Intact and Belairdirect brands.
"With the growing popularity of the sharing and on-demand economy, we are adapting our product range to offer innovative solutions to meet the changing needs of consumers," Louis Gagnon, president of service and distribution at Intact Financial Corp., said in a statement.
Questions began swirling around Uber's insurance policies after the Alberta government said in July that it had determined the policies do not meet the requirements of the province's Insurance Act.
Uber Canada has argued that its insurance policies are adequate. A spokeswoman for the company said in July that every ride on the uberX platform is backed by $5 million of commercial auto insurance, which covers both bodily injuries and property damage stemming from a crash.
"The bottom line is this: every ride on Uber is insured," spokeswoman Susie Heath said in an email at the time.
However, the Insurance Bureau of Canada has recommended that drivers who work for Uber call their insurance providers to verify that their vehicles are insured for commercial use.
The industry group, which counts Intact as a member, noted that some policies only provide coverage for personal automobile use and insurers could reject a claim if the vehicle is used to generate income.
Uber, which allows riders to hail a ride using a smartphone app, offers an alternative to conventional taxi services, something that has caused controversy and sometimes friction in communities where it operates.
"Uber is excited to be working with Intact Financial, the leading Canadian provider of auto insurance, to develop an innovative insurance plan specifically tailored for ridesharing in Canada," Ian Black, the general manager of Uber Canada, said in a statement.
"Every month there are over a million Uber rides completed across Canada and that number is growing every day."
Intact Financial is Canada's largest provider of property and casualty insurance, collecting $7.5 billion in premiums annually through its various subsidiaries.