Uber trumped by new ride-share company’s insurance approach

Uber trumped by new ride-share company’s insurance approach

Uber trumped by new ride-share company’s insurance approach A new player has emerged in the ride-share industry – and they’re effortlessly entering markets that Uber has since sworn off.

TappCar, an Edmonton-based ride-share company, has recently expanded operations into Calgary without ruffling the resident taxi industry’s feathers as every driver comes equipped with a class 4 licence and full commercial insurance.

Company spokesperson Pascal Ryffel says that focusing on a skilled, full-time workforce and abiding by the rules is a “deceptively simple” approach. “The reason it financially works for us is, rather than having a whole bunch of part-time drivers like a lot of other ride-share companies have, our drivers are full time,” he says. “All of our drivers have full comprehensive commercial insurance, which would be the same insurance as taxi drivers have.”

Each driver pays TappCar a $250 “subscription fee” per week, which includes benefits and pensions, marketing costs, and insurance. Pascal says the fee ensures drivers receive the support they need from the company, and ensures each has the coverage required to legally operate on a full-time basis – though the time put in is up to the driver.

“The biggest chunk of that $250 of course is insurance,” he says.  “If there’s a driver fee, I think companies become more selective as to which drivers they choose to have as representing their company – rather than just picking anybody with a pulse, you’d actually be selective.”

He adds that as additional ride-share insurance options become available in the province, the ride-share company will also consider adding part-timers to the fleet. “We are certainly keeping our eyes open beyond July when the new insurance framework comes into effect here in Alberta ,” he says.

It’s a much different narrative than that of Uber’s, which exited the Calgary market following a passed bylaw that imposed similar regulations for insurance, background checks and fees that taxi drivers face.

“I certainly don’t think it’s an unworkable model at all,” Ryffel says. "I think the main sticking point for Uber was that they require a licencing fee per driver rather than the holistic team – we do think that’s important because the risk is if your jurisdiction says, you can just pay per ride, the temptation for a lot of companies is to add as many drivers as they possibly can. They make more money that way.”