Every person I know who has used Uber has been extremely pleased with it. The cars are clean, the drivers are polite and generally quite knowledgeable, and the smartphone app lets both driver and customer know what's what.
So why is there a problem with allowing Uber to compete with taxis and with limousine services? As most of you know, I am strongly in favour of limiting restrictions on competition in the taxicab industry, having played a role the local changes that allow limousines to compete more directly with licensed taxicabs.
The only problem I see with Uber is insurance. In Ontario, we have no-fault auto insurance. Furthermore, Uber charges for (and is believed to provide) liability insurance for their drivers, even if they aren't carrying a passenger, so long as the driver is logged onto Uber as "available". So customers are probably covered, as are third parties (but see below).
The problem comes with the drivers themselves. If they carry paying passengers, they need to carry "commercial", not "personal" auto insurance. To drive for Uber and to have only personal auto insurance is taking a personal gamble, as well as possibly imposing a risk on potential third parties; and it is quite possibly defrauding the insurance companies.
I asked my insurance agent for RSA, with whom we have our auto insurance, about this and here is what she replied:
At this time, a Personal Policy with RSA will NOT provide any coverage for UBER driving.
As you would now be “carrying passengers for hire”, you would need to get a commercial policy if that was something you were interested in.
Although UBER may provide some liability in a lawsuit situation, there are other factors (Accident benefits / damage to your vehicle etc) which would also have to be dealt with.
Part of the application does specifically ask about carrying passengers so we are required to disclose it to the insurance company.
... [W]ith this being new to London, the companies are just reacting to [it] now. This may be something that changes in the future; however at the moment it is not something they are willing to cover – and all coverage would be denied in the event of a claim. [emphasis added]
To be clear: no, I am not intending to drive for Uber (though I would consider it if personal auto insurance were sufficient).
What this means, then, as someone pointed out somewhere on Facebook, is that if you ride with Uber (in London, Ontario, as of now), you are likely signaling that you are willing to give business to someone who is likely lying to their insurance company.
And with that in mind, I probably will not be using Uber in the near future.