Since its launch in San Francisco in 2009, Uber has reached 204 cities in 45 countries across the world. The service is operated via a mobile app, which unlike a regular taxi service, states that it is a “ride-sharing service” rather than a private hire taxi firm.
The considerable growth of Uber hit the headlines during 2014, thanks to unrest among private hire and black cab services throughout the UK. London, in particular, saw heavy demonstrations due to cabbie’s frustrations that Uber’s drivers are not regulated in the same way that black cab drivers are.
Statistics released in October 2015 by the Mayor of London, Boris Johnson, highlighted Uber’s phenomenal growth in London alone. In three years, the company has grown from zero designated drivers to 20,000, whilst there are now only 22,500 Hackney cabs available.
Recently, Uber won a significant High Court battle, rejecting the claim that the service was not a metered taxi because fares were calculated via a central system, rather than inside vehicles.
The accelerated growth of the company has led to the app’s British turnover increasing tenfold last year to more than £11.3m. This figure reflects Uber’s share of fares for trips booked via the service, with at least 70% of payments going straight to the self-employed driver. This growth is still continuing to increase.
How does Uber work?
Customers use an interactive map via a smartphone to submit a journey request. This request will then state a star rating for the user and designated driver, journey details, real-time map and breakdown of costs.
Unlike private taxi firms, Uber consider drivers to be independent contractors rather than employees. All Uber drivers must use their own cars and have to take out their own private commercial taxi insurance. A normal car insurance policy is insufficient and is likely to be void in the event of an accident. Overall, this means that the service doesn’t keep check on the health of vehicles and the conduct of their self-employed drivers.
What happens if I am in an accident?
Normally, if you are an injured passenger in a taxi that crashes, you would expect to be able to claim for any injury sustained from the taxi company. But what happens if you are a passenger in an Uber vehicle?
Users who decide to download the app must agree to a list of terms and conditions which states that, “Uber will not be liable to you in respect of any acts or omissions of its employees, agents or sub-contractors.”
As Uber considers itself to be a technology provider and its drivers to be self-employed, passengers who are injured in a collision may find themselves frustrated. The company does not provide an official customer service phone number, and can only be contacted via a contact form on its website.
Accidents in Uber vehicles can and do happen. In July 2015 a 32-year-old man was left traumatised following an accident where he was a passenger in an Uber vehicle. The driver collided on the motorway and the car burst into flames, leaving the passenger with significant cuts and bruises. The firm offered him a £35 refund for his journey before suggesting that he contact the driver. Uber later opened up an investigation and offered the passenger support throughout insurance claims.
Insurance policies for Uber remain a grey area across the world. In Toronto, Canada, it has been claimed that Uber does not insist on commercial insurance for vehicle owners, meaning that there may be drivers operating under policies that are not valid for private hire use. In other countries, police forces are actively involved in clamping down on Uber contractors who are operating without commercial insurance.
In the UK, the business has recently reviewed their systems after it was found that a London Uber driver had fake insurance documents approved by the company. In June 2015, Uber responded to the story and stated that the company had ‘backstop’ insurance in place that would cover customers if a driver had an accident without insurance, even though drivers were required to be covered with a private hire licence.
Many critics have noted that better strategies need to be implemented by Uber to ensure that drivers have the appropriate policies and that passengers are safely covered throughout their journey.