Canada: Does Uber Insure All Of Us? Uber Users Buyer Beware

The "sharing economy" is on the rise and there is little chance of ebbing its tide. Popular sharing services such as airbnb, Lyft, Zipcar, Car2go and AutoShare have been in business for almost a decade but UberX appears to be at the centre of the debate.

The Provincial Government and the City or Toronto have decided that ignoring the sharing economy is no longer an option. Both are now responding to the exigencies of the new forms of conducting business with the use of residential property and personal vehicles to generate income.

Bill 131 – Opportunity in the Sharing Economy Act - passed its second reading at the Ontario Legislature on October 29, 2015 and the bill was referred to the Standing Committee on Finance and Economic Affairs. According to MP Tim Hudak, the sponsor of the private members bill, the "bill creates a modern, streamlined, province-wide framework to allow the municipal licensing of transportation network vehicles, home sharing and parking sharing".1 All signs point to the inevitable acceptance of the sharing economy elevating to the norm, even though the Ontario government has elected to take more time to study Mr. Hudak's bill.

However, an important, and unsettled, question in the UberX debate remains: is there currently adequate insurance coverage for those who offer services through UberX's transportation platform ("Partners" or "Transportation Providers" but more commonly known as drivers) and those who request UberX's services ("Users" commonly known as passengers). This article explores the adequacy of UberX's automobile insurance coverage in Ontario for drivers, passengers and third parties.

Ontario has a unique and evolving scheme of auto insurance which includes third party liability, property damage, loss or damage coverage, and mandatory Statutory Accident Benefits (SABs), also known as "no-fault" benefits. Uber has maintained that it has "contingent" auto coverage in place that would respond to claims made by passengers, pedestrians or other drivers. Conspicuously absent is any mention of coverage for drivers of UberX vehicles.

Before we get started, there are few interesting things about Uber that you might not know. First, more often than not when people say they use Uber, they actually meant to say they use UberX. UberX vehicles are personally owned vehicles, intended for private use that their owners (presumably) use to transport Uber Users. They are not taxis, they are unregulated, there is no required scheduled maintenance regimen and, according to Uber's website, the vehicles can be up to 15 years old. The average age of UberX "Partner" vehicle is 7 years.

Second, in Canada, the "contracting partner" for passengers using the Uber application ("app") is a Dutch corporation called Uber B.V. However, Raiser Operations B.V. – another Dutch corporation – is the "contracting partner" for drivers. These corporations are separate and distinct from Uber USA, LLC. This raises a host of questions around choice of jurisdiction and choice of law. The Canadian version of the Uber "User Terms" states that disputes in relation to the use of Uber "Services" are subject to the laws of the Netherlands and "settled exclusively by the competent court in Amsterdam". Who doesn't want a trip to Amsterdam?

Third, Uber holds itself out as a technology platform, offering a means to obtain transportation services via third party "Transportation Providers" through its app. The app allows "Users" to request transportation services from Uber's "Partners". Uber claims it is not a transportation carrier nor does it provide transportation services. The provision of the service (a.k.a. the ride) is a private contractual agreement between the "User" and the "Transportation Provider". What obfuscates this is that the entire transaction, from arranging the ride to paying for the ride, is all done through Uber's facilities.

Fourth, there is currently no information on insurance coverage as it would apply in Ontario or Canada on the Uber website. The insurance details discussed on the Uber website only describe their understanding of the how their CGL policy would apply in America. In America, Uber has what they call an "end to end" Commercial General Liability ("CGL") policy with $1 million in liability coverage per incident. The Uber policy is in effect "en route" (after a pick-up is accepted) and "on trip" (during the provision of the service). During the intermediary period (when a driver is waiting for a request), the driver's personal policy is expected to respond to any claims arising from the use and operation of the vehicle. Unfortunately, that's not how auto policies currently operate in Ontario.

Uber has even tried to prevent the release details of its insurance policy in the course of litigation involving the City of Toronto on the basis that the content and form of its policy were a "trade secret". Uber was unsuccessful in that regard. Justice Diamond held that Uber failed to present sufficient evidence to show that the sealing of the policy was warranted or that its disclosure would result in any loss of competitive advantage.2

Lauren Altmin of Uber told the CBC that "every ride on the UberX platform in Canada is backed by $5 million of contingent auto liability addition to any insurance coverage maintained by the driver."3 Contingent meaning that it only responds when the driver's personal auto coverage fails to respond. In this lays the Uber insurance coverage gap.

Following Justice Diamond's decision in March 2015, the Uber policy was disclosed and it was discovered that Uber's $5 million coverage policy was a CGL policy with an endorsement for standard non-owned automobile coverage, issued by AIG Insurance Company of Canada.4 According to Philomena Comerford, CEO of Baird MacGregor Insurance Brokers, this type of policy is designed to protect the corporation (Uber) that purchased the policy, not the drivers5.

In Ontario, like in many jurisdictions, there are personal use and commercial use auto policies. The distinction between policy classifications addresses the different intended uses and associated risks. A specific exclusion, which may lead to a denial of a coverage and cancellation of a personal auto policy, is the use of a personal vehicle to carry passengers for money.

The intended use of a vehicle and risk determines the type of policy issued as well as the premium. The insurer calculates risk based on information disclosed by the applicant. In the Ontario Application for Automobile Insurance Form (OAF 1) the applicant is asked to answer the following question: "Will any of the described automobiles be rented or leased to others, or used to carry passengers for compensation or hire...?"

Should an insurer discover – which would not be difficult – that its insured was using his or her personal vehicle to carry passengers for money (a commercial use), the policy may be cancelled and/or coverage denied. Cancellation could result regardless of whether or not the accident occurred at the specific time the driver was engaged in a commercial activity. Should the insurer discover you were breaching policy conditions at any time during the policy period, altering the material risk, the policy could be void ab initio, compromising the driver's insurance.

One of few times an insurer can deny coverage is set out in the exclusions listed under section 250(1) of the Insurance Act. The section states that an insurer "shall not be liable" when an automobile is used as a taxicab orfor carrying passengers for compensation or hire.

However, certain "no fault" benefits will be maintained.

Statutory Accident Benefits

As a private vehicle owner you have a standard Ontario Insurance Policy (OAP 1) which includes mandatory accident benefits coverage. Should you be involved in a motor vehicle accident as a driver or passenger of a vehicle insured in Ontario, you would be entitled to accident benefits which include coverage for medical and rehabilitation expenses, income replacement (IRB), non-earner (NEB), caregiver and potentially attendant care and housekeeping benefits. Commercial auto policies in Ontario also include accident benefits coverage. However, a standard CGL policy would not incorporate accident benefits. The Insurance Bureau of Canada has been clear that for-hire ride services must carry commercial automobile insurance.6

Section 1.8.1 of the OAP 1 states that when a personal vehicle is used as a taxi or to carry paying passengers there is no coverage, except certain accident benefits. Third party liability (section 3), property damage (section 6) and loss or damage coverage (section 7) are forfeited.

Section 1.4.1 and 8 of the OAP 1 requires an insured to "promptly" notify its insurer of a change in material risk to the policy. Transporting passengers for hire would be considered a material change in risk. During the application process, applicants are specifically asked whether an intended use of the vehicle will be to carry passengers. Section 447(2) of Insurance Act states a person will be guilty of an offence if he or she fails to inform an insurer of a material change in circumstances within 14 days of the material change. The offence carries a fine on first offence of "not more than $250,000"7. These responsibilities and penalties are also laid out in the Ontario Application for Automobile Insurance (OAF 1).

In addition to the fine, an insurer can cancel the policy altogether pursuant to section 1.7.2. The cancellation would be premised on the insured knowingly misrepresenting, failing to disclose information and/or the risks having materially changed.

However, certain accident benefits will be maintained, despite policy violations. Section 13 of the OAP 1 states that a failure by an insured to comply with the Statutory Conditions (section 8), will not disentitle the insured to certain accident benefits. The rationale for this can be traced back to the government policy objective in creating the Statutory Accident Benefits scheme (SABs) in the first place, which was to transfer the expense of providing medical and rehabilitation expenses following a motor vehicle accident from the public healthcare system onto auto insurance carriers. However, exclusions to coverage exist under the SABs.

Section 31 of the SABs states that the following accident benefits will not be payable where a material misrepresentation has been made or the insured intentionally failed to inform the insurer of a material change in risk: the income replacement benefit, non-earner benefit, lost education benefit, visitor's expenses and the housekeeping and home maintenance benefit. The only benefits that remain post-breach are: caregiving, medical and rehabilitation, and attendant care benefits. The exclusions will apply to the driver of an UberX vehicle. The most significant exclusion for the driver would likely be the loss of entitlement to the IRB.

For passengers in UberX vehicles, pursuant to the priority as set out in section 268(2) of the Insurance Act, accident benefits coverage would fall to their own auto policy. So, if a passenger is a named insured on another policy, then he or she will have access to full accident benefits. If a passenger is not a named insured on another policy, coverage would default to the UberX's driver's policy. The exclusions that apply to the driver would not apply to the passenger. Passengers should be covered under the driver's contract of insurance.

Third Party Liability and Loss and Damage Coverage

The same policy breaches as discussed above will result in the denial of property damage and loss and damage coverage for the UberX driver. We anticipate that insurers will also take an "off coverage" position in relation to third party liability claims, reducing the insurer's liability to the statutory minimums of $200,000.00 pursuant to section 251(1) of the Insurance Act.

For UberX drivers, be aware that your insurer is permitted, and likely will, commence a subrogated claim against you to recover any amount it pays out to a third party as a consequence of an accident you are involved in. Further, you may be personally liable to the injured party for any amount above the statutory minimum of $200,000.00.

Uber has indicated that its "contingent auto liability insurance" (S.P.F. No. 6 Standard Non-Owned Automobile Policy) will respond to third party liability and property damage claims. As previously mentioned, non-owned automobile policies are meant to protect the company (Uber), not the driver. The "named insureds" on the AIG policy are Raiser Operations B.V. and Uber Canada Inc. Additional insureds include "partners, officers or employees". UberX drivers do not fall under any of these categories. Coverage and indemnification from this policy would not extend to the driver.

Further, Uber has not been clear whether bodily injury or property damage sustained by the driver would be covered under UberX's non-owned automobile policy. Uber spokesperson, Susie Heath, said: "[i]n the event of an accident during an UberX trip, passengers, pedestrians, other drivers, and the community at large can rest assured knowing that ridesharing partners are well covered by commercial auto insurance in addition to any insurance coverage maintained by the driver."8 Notably missing is confirmation of coverage for UberX driver claims. The AIG policy agrees to insure for "legal liability for bodily injury" to third parties and "damage to property of others". There is no stipulated coverage under this policy for bodily injury or damage to the driver or his or her vehicle.

An interesting question is who would be the correct parties to sue for recovery when a tort claim is commenced? The driver, Uber Canada Inc., Uber B.V., Raiser Operations B.V. and/or Uber USA, LLC? Although Uber has chosen Netherlands law, it would be hard to fathom how Uber would be successful on meeting the real and substantial connection test for the Netherlands' being the appropriate jurisdiction where the parties and accident occurred in Ontario. We will have to wait and see.

The Rise of the Sharing Economy

Recently Aviva Canada announced it had begun a crackdown on UberX drivers caught without a commercial licence. In an internal Aviva Canada circular it stated that "[d]riving for Uber is still considered a commercial use and is unacceptable for personal vehicles"9. Aviva has voided two polices, lapsed another policy at renewal and agreed to rewrite a fourth policy after it was determined the driver had not deliberately misrepresented the use of her vehicle.

But change is a foot. Even in the face of opposition from the established stakeholders, the sharing economy is here to stay. This past year the City of Toronto was unsuccessful in getting an injunction against Uber. More recently taxi drivers in Toronto commenced a $400 million class action lawsuit against Uber claiming Uber contravenes section 39.1 of the Highway Traffic Act.10 Many other municipalities have also cracked down on UberX giving out fines and impounding vehicles. A court has recently issued a temporary injunction stopping drivers from offering rides for a fee using the Uber app in Calgary.11

But UberX has its strong supporters. The Ontario Chamber of Commerce and the Insurance Bureau of Canada have urged the province and federal government to enact legislation to respond to the new sharing economy.12 Toronto's Mayor John Tory has signalled that Toronto will amend its by-laws so that both UberX and traditional taxi brokerages can operate in Toronto. The Province appears to be moving forward with Bill 131.

Further, at least one Ontario insurer is trying to get ahead of the curve on the sharing economy. Intact Financial Corporation, which operates Intact Insurance and Belair Direct (among other entities) announced in September 2015 that it was working with Uber to devise the first ride-sharing auto insurance policy in Canada tailored to protect drivers (formerly "Transportation providers") and passengers (formerly "Users").

As things currently stand, Uber users and drivers beware, insurance coverage gaps exist. Uber drivers should contact their brokers and insurers immediately (this will likely result in a change in your premium but will have the effect of minimizing any chance of a denial of coverage). If you are an UberX driver you may lose your direct (property damage) and third party liability coverage (leaving you personally exposed to property damage and personal injury claims) and your accident benefits coverage may be drastically reduced.

As a passenger, your "no fault" benefits will be covered by either your own policy or that of the driver's, without exclusion. However, any personal injury claim you may have against the "Uber" group of companies in tort will face complications and recovery will be an issue. However, we anticipate legislative change and insurer ingenuity in the New Year will address some or all of the current gaps in coverage.


1 Hansard, October 27, 2015. Source:

2 City of Toronto v. Uber Canada Inc. et al, 2015 ONSC 1617, paras 33 to 42

3 "Uber warning issued by Canada's insurance industry", Brian Burnette, CBC News, October 17, 2014. Source:

4 "Uber Canada's hush-hush policy is standard stuff, say insurers", Betsy Powell, Toronto Star, July 30, 2015. Source:

5 Ibid.

6 "Insurance bureau raises concerns about extent of Uber coverage", Betsy Powell, The Toronto Star, February 4, 2015. Source:

7 Section 447(2), Insurance Act, R.S.O 1990, C.I.8

8 Ibid. "Uber Canada's hush-hush policy is standard stuff, say insurers"

9 "Insurer cancelling policies of UberX drivers", Betsy Powell, The Toronto Star, October 31, 2015. Source:

10 "Uber faces class action lawsuit filed on behalf of Ontario taxi drivers", Ryan Remiroz, CBC News, July 23, 2015. Source:

11 "Court puts brakes on Uber in Calgary", Martin Ollman, The Toronto Star, November 21, 2015. Source:

12 "Insurance Bureau of Canada pushing to get Uber drivers covered", Shane Dingman, The Globe and Mail, October 13, 2015. Source:

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

In association with
Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
Email Address
Company Name
Confirm Password
Mondaq Topics -- Select your Interests
 Law Performance
 Law Practice
 Media & IT
 Real Estate
 Wealth Mgt
Asia Pacific
European Union
Latin America
Middle East
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions