UberX Is Killing Cab Industry, Drivers Say

Categories: Economy

"UberX has regular passenger insurance, taking 20 percent from the driver," Condie says. "But they basically tell drivers not to get insurance, to put it on your personal insurance. But you can't put others on your insurance."

A Chicago-based cabdriver working with Uber, who goes only by the name Joe, tells New Times that Uber held a meeting of taxi drivers in his area several weeks ago. At this meeting, they told drivers that the company does not allow commercial insurance. "I'm sitting in this meeting and they're saying this to us, and I couldn't believe it," Joe says.

The UberX rep at the meeting was peppered with questions about insurance. The drivers, Joe says, were told they would receive more information about it via email. That email has yet to arrive, Joe claims.

Joe's concern is that UberX is opening the door for non-taxi drivers to start giving people lifts around the city for money without proper regulation.

"It's decimating the cab industry," he says. "They're bringing in regular people and telling them to operate as cabbies and not providing them with insurance."

The bottom line is, commercial insurance is expensive. In some states, it can cost a cabbie up to $5,000.

"It basically fucks up their business plans," Joe says. "But if you have a passenger and he gets injured in an accident, where do they file a claim?"

For rideshare companies like UberX, Lyft, and others, there are obvious advantages to having no regulation -- for both the driver and the passenger, it's cheap. And because there is no overhead, a company like Uber has flourished with its UberX service. And Florida could be next.

"The main problem with this industry is communication," Condie says. "I have no problem with rideshare entering our market, but it has to be regulated."

Condie says another app, called MyTaxi, which has been successful in Europe and recently entered the D.C. and Miami markets, is charging drivers only 2.6 percent and $1 per ride. Uber, Condie says, is charging drivers 20 percent for the same technology while not kicking a single cent back to local government, regulators, or the State of Florida.

And avoiding regulations.

For her part, Condie has sent a letter to the Florida Department of Insurance.

"Operators such as Lyft/sidecar/UberX are preying on the nation's dysfunctional taxi system and the fact that city/county/state governments AND insurance regulators are not in sync with each other and have no clue what is going on," her letter says. "The risk of exposure of private insurance is so great due to fraud/abuse it can be market destabilizing."

The bill going through the Florida Legislature to get Uber into the Sunshine State recently passed its first committee.

Send your story tips to the author, Chris Joseph.

Follow Chris Joseph on Twitter.

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I don't get why there needs to be special "commercial" insurance for this? Personal auto-insurance does not require every potential passenger in a vehicle to be listed on the insured's plan - every member of the household maybe, anyone who might possibly DRIVE your vehicle. But not passengers.

I mean look at it this way. Say my Aunt Betty asks me to drive her friend (who is not anyone that lives with me or that I even know; and who has never driven in their life; hence has no auto-insurance of their own nor listed on mine) to the airport. Her friend was planning on dropping me a 10 spot to cover my gas in exchange for the favor. However we never make it to the airport because some moron ran a red light and t-bones us. Does my personal insurance cover Aunt Betty's friend? If so then hows that different? If not then why would it matter if I was running the favors commercially - no difference in terms of insurance.

frankd4 topcommenter

.............at $4.50 first mile and $2.40 each additional mile it's $26.10 to go TEN MILES - right ?

okay add a 20% TIP and the grand total is $32 rounded or $3.20 per mile

AARP mileage costs to operate and old vehicle is $.65 so for TEN miles the cost is $6.50 leaving a "profit" of $25 rounded or $2.5o per mile on average

if i got someone to drive me 10 miles i would give them $20 total and would be glad to do it for free ! anyway i just don't see WHO is sucking all this money out of the transaction - certainly not these cab drivers - right ?

sound like a bunch of greedy annonymous bastards that want to protect their right to "screw the public" in this on-going scam perpetrated mostly on poor people and unsuspecting visiting travelers

frankd4 topcommenter

....................actually it was the TAXI industry that killed itself being long known as a rip-off to visitors and locals alike

for example on BLACK FRIDAY when 200 plus cars were involved in a predatory towing scam at the SAWGRASS MILLS MALL the people who were involved were again abused by the taxi cab drivers who charged a flat $95 to go a few miles PLUS only one person could ride at a time - no two people could share the cab ride ! eventhough they were ALL going to the towing yard - so the "screw the tourist" mentality was extended to "screw the local yokels too"

myself i am convinced that the swirling entrance and exit to the FT LIQUORDALE airport was purposefully designed so that the cab ride would be $12 before you even left the airport grounds (and of course another $12 coming back in)

as the drivers are typically slave labor for minimum wage its the operators and owners that have killed this GOOSE = period


Since when did "Now There's An App For That" start meaning that existing laws and regs don't apply anymore?

whateveryousay topcommenter

Let Uber in!  Free market and free competition!  

whateveryousay topcommenter

@justaguy.chi  When the laws and regs don't apply, well, they don't apply.  Take FedEx and UPS as an example.  You'd think that they are under the same stuff but they aren't.

One is covered by the National Labor Relations Act and the other by the Railway Labor Act.  Completely different rules and regs for each of them.

Simply put, the rules that govern taxis don't apply to Uber and the drivers of Uber.

They are governed by different laws and regs.  It is that simple.


@whateveryousay  "free market and free competition" at the expense of riders and drivers in the event of an accident? So, you're cool with not getting compensated if you get in an accident in one of these vehicles?

whateveryousay topcommenter

@tracietaxi40 @whateveryousay  They do have insurance and there is a corporation who runs the show. I'll bet I'm covered somewhere.  Besides that, I got so frustrated with taxi services.  I would call to get a cab and sometimes get a window of a couple hours for them to arrive. I would get cabs that wouldn't show up and when I'd call to find out what was going on the answer was usually a pretty big tough shit.  We were robbed by a taxi driver in Vegas.  Yes, robbed.  Turned into quite the mess. Police statements were given and video surveillance was reviewed and the driver was arrested. Our stuff was found at their home and sent back to us stinking of god only knows what.  That dumb ass actually used one of our phones to call people.  

So, in short, my experience with taxis has been miserable.  So far with Uber I call and they show up pretty quick.  The cars have been far cleaner and smell better.

I'll take my chances.

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