Transport For London refuses to renew Uber's operating license

[Raw Shark]

On the subject of insurance, as a real taxi driver I am required to carry a professional chauffeur's policy that covers my clients for up to $1,500,000, and costs me $8,000/year. I had a passenger get his back broken by a drunk driver one time, and he had to file a claim on my policy for hundreds of thousands of dollars before he was through. Back when I had a normal vehicle before the near-Biblical flood swallowed it, I was paying $900/year for a policy that covered anyone I hit for $15,000 and anyone in my vehicle for $0.00 (ie: jack and shit). Guess which one ride share drivers are allowed to skate by on?

[Simon_Jester]

Simon, I’m talking about people quitting their jobs thinking they can make a living doing it. When people are in desperate straits that’s different.

Sorry, it wasn't clear to me that you were talking about people who had jobs to quit.

On the subject of insurance, as a real taxi driver I am required to carry a professional chauffeur's policy that covers my clients for up to $1,500,000, and costs me $8,000/year. I had a passenger get his back broken by a drunk driver one time, and he had to file a claim on my policy for hundreds of thousands of dollars before he was through. Back when I had a normal vehicle before the near-Biblical flood swallowed it, I was paying $900/year for a policy that covered anyone I hit for $15,000 and anyone in my vehicle for $0.00 (ie: jack and shit). Guess which one ride share drivers are allowed to skate by on?

Yep. And that corrects a mistake I was making earlier.

The cost is not necessarily borne by the insurance companies; it may well drop straight onto the victims of a car accident.

And if any market advocates say "well, you knew you were climbing into an uninsured vehicle when you accepted that as the price of cheaper service..."

Does Uber point this out to its customers? Does Uber offer "insured driver service" at a premium? If you poll Uber customers, what fraction of them think there's insurance that will cover the cost of their injuries if they get hurt in an accident while riding in an Uber car? What fraction of Uber passengers know that Uber drivers do not, on the whole, have such insurance, while regular taxi drivers do?

In the kind of society where free market choices lead to good outcomes reliably, the answers would be "yes, maybe, 0%, and 100%." I bet that in real life they're "not really, no, significant, and tiny." Because realistically, people do not look up insurance information before signing up for a commercial service. They don't think of it, until they get bones broken in a car accident and suddenly "who the fuck is paying for this" becomes important. And that is such a common 'vice' that it seems ridiculous to claim that people deserve to be crippled for it.

[Raw Shark]

Does Uber point this out to its customers? Does Uber offer "insured driver service" at a premium? If you poll Uber customers, what fraction of them think there's insurance that will cover the cost of their injuries if they get hurt in an accident while riding in an Uber car? What fraction of Uber passengers know that Uber drivers do not, on the whole, have such insurance, while regular taxi drivers do?

That's a pretty good question. My answer to it would tend toward armed cynicism, bitterness, and rage, if I lost hope.

[Flagg]

Simon, I’m talking about people quitting their jobs thinking they can make a living doing it. When people are in desperate straits that’s different.

Sorry, it wasn't clear to me that you were talking about people who had jobs to quit.

I wasn’t very clear about it, looking back at my posts. Getting over an hellacious sinus infection.

[Terralthra]

The idea that Uber is profitable is ridiculous. Uber is heavily subsidized by venture capital at this point in time, with the capitalists in question gambling that Uber will be able to continue to undercut traditional taxicabs long enough that they go out of business and Uber can raise prices (and cut wages more) at that point. The last quarterly report they released showed a loss of 708 million USD on 3.4 billion in revenue.

[Broomstick]

AND you have more subtle effects that will inevitably occur, like "well shit, the Uber drivers are getting in more accidents but not paying higher car insurance premiums, which means the rest of us have to indirectly subsidize the cost of their car accidents through our own higher premiums, whether we use Uber or not." Much less severe costs, but also a 100% probability of happening.

Why would they not be paying higher costs for their insurance premiums? This would work for exactly ONE accident, and then their premium would go up.

Yes; their premium would go up for the accident, to the same level as a private driver who had one accident. Now they're being charged the same rate as someone who drives the average amount and has had one accident in the past N years. They still drive more than that person and are still a higher risk. Only after a period of several years with the driver's true accident rate becoming clear does this factor balance out.

You are both incorrect.

If you are in an accident and your insurance discovers that you were using your car for commercial purposes while only having private driver insurance they can CANCEL your insurance and refuse to cover the accident. So no, it won't work for even one accident.

As far as I know people who use their private vehicle for work don't have to pay higher premiums unless they insure it through their business, and that is not the case for millions of small and home business people.

You do not have to have business insurance for normal work commuting. You DO have to have it if you're using your car to make money, in other words, as a taxi.

[bilateralrope]

If you are in an accident and your insurance discovers that you were using your car for commercial purposes while only having private driver insurance they can CANCEL your insurance and refuse to cover the accident. So no, it won't work for even one accident.

How many of the Uber drivers know that ?

[Flagg]

When you have people doing business with a car and they get non-professional insurance, they are both committing insurance fraud and if enough of them do it the insurance companies will raise the premium of everyone else or lose money.

[Flagg]

If you are in an accident and your insurance discovers that you were using your car for commercial purposes while only having private driver insurance they can CANCEL your insurance and refuse to cover the accident. So no, it won't work for even one accident.

How many of the Uber drivers know that ?

I’m sure most don’t.

[Simon_Jester]

Yeah, because I can't see Uber telling its new drivers when they sign up "so yeah, you're going to need new and much more expensive insurance." Because their business model depends heavily on cutting corners and getting their drivers to do the same.

The idea that Uber is profitable is ridiculous. Uber is heavily subsidized by venture capital at this point in time, with the capitalists in question gambling that Uber will be able to continue to undercut traditional taxicabs long enough that they go out of business and Uber can raise prices (and cut wages more) at that point. The last quarterly report they released showed a loss of 708 million USD on 3.4 billion in revenue.

That's a fair point. I should not say "Uber is profitable, they can take hits.

At the same time, though, this kind of undercuts Uber's claim to be outcompeting the taxis at their own game. In order to do so, they either have to pay drastically lower wages, charge drastically higher rates, violate laws that the taxi drivers have to follow, or some combination of the above.

[K. A. Pital]

It is just another price war in the market where the new money seeks to drive out old money using a vehicle company, like Uber, and hoping there will be a market left after the price war.

These calculations can misfire. And I hope they do. Nothing would be better than Uber and its sponsors, along with a multitude of other "venture capitalists" to go bust.

[TheFeniX]

If you are in an accident and your insurance discovers that you were using your car for commercial purposes while only having private driver insurance they can CANCEL your insurance and refuse to cover the accident. So no, it won't work for even one accident.

Wait. Uber doesn't have any kind of commercial insurance coverage or require it? How is that even legal? And in many cases I've dealt with, they won't cancel your insurance as much as they will just say "you're not covered" and leave it at that. Though, you might just be using cancel differently than I'm used to, so sorry if that's the case.

But, this is what happened to a coworker who took his motorcycle to pick up part from a supplier. He ended up wiping out on his crotch rocket because he was doing 100mph. For numerous reason, the least of which being our commercial insurance doesn't cover fucking motorcycles, his bike was toast as no one would pick up the tab. He's lucky our boss (and insurance) let him file a workers comp claim to pick the gravel out of his ass.

You do not have to have business insurance for normal work commuting. You DO have to have it if you're using your car to make money, in other words, as a taxi.

Yes, there's a difference between commuting to work/a specific jobsite and actively using your vehicle to make profit. Even billable mileage doesn't always necessitate commercial insurance. But just like if I have a package delivery service or are transporting work supplies (outside that employees work "toolkit") back and forth: the idea that transporting people in a people transporting business wouldn't require commercial insurance is hilarious.

This is why you never charge someone for dragging their stuck vehicle out of a bad spot unless you want to play with fire. The minute you demand money, you're essentially operating an unlicensed and uninsured towing business. If nothing goes wrong, kudos. If you break something on their car (or yours) you're immediately liable (unlike if you were just a good Samaritan) and your insurance will not cover it. It fact, the person who "hired" you may find their own insurance deny them because they knowingly used an unlicensed and uninsured service.

[Terralthra]

Uber has commercial insurance that covers you while you have a passenger in your car. It does not cover you while you are active on the app awaiting a ride to be assigned. Since the time spent waiting for a ride assignment is usually spent idling around in busyish streets while looking at a cell phone, accidents during this time are not uncommon. Uber's insurance doesn't cover it, and private policies also will refuse to cover it. Some of them will cancel the policy over it, others will just refuse to cover the cost of the accident.

[TheFeniX]

Wow. How has this NOT caused insurance companies to get up in arms (or have they and I've just been under a rock)? I have to assume a number of the accidents find the Uber driver at fault, which means that the person they hit (hopefully they have full coverage and not just liability) would have to file their claim under their own insurance. Which, of course, said insurance would try to recoup the loss against the Uber driver, who likely couldn't afford the court fees, much less the payout. Or the not-at-fault party would have to sue directly.

This would also mean a much larger impact to the Uninsured and Underinsured Motorist Act which damn it if I can't recall if that's a Texas thing or National. Basically, in instances where you get hit by someone with no (or not enough) insurance, you can file a claim for reimbursement (however small) for the damage to the vehicle.

This whole thing is a huge clusterfuck.

[Terralthra]

Apparently, after the first few high-profile accidents resulting in no coverage and canceled policies (and ruined lives), Uber introduced a shittier contingent policy to cover the active-on-the-app time. It covers up to the state minimums, but is still substantially inferior to the commercial insurance during the actual ride.