Worry about insurance coverage with the introduction of accident insurance for Uber drivers.

As we reported earlier, the new gig economy had obvious attractions to the public through its flexibility and affordability.  It was also seen as a good way that people could be provided with flexible employment.  However, one of the practical concerns has been around the financial coverage of both Uber driver and passenger should there be an accident.

At least in part, the practical problem was side-stepped by Uber because it felt that its drivers were not “employees” under the law.  In this way, the drivers were not provided with the types of conditions that are typically standard for employees, such as sick leave, Workers’ compensation insurance, holiday pay etc.

The recent Decision by the Fair Work Commission ruled that Foodora delivery riders were in fact employees and not independent contractors.   As a consequence, the employer (Foodora) was legally obligated to provide the type of protections that are standard for employees under the Fair Work Act.

Uber will provide free accident insurance cover to its drivers as part of a multi-million dollar initiative amid this debate about the lack of security and protections for workers in the gig economy.

There are approximately 80,000 Uber and Uber Eats drivers and riders.   The Policy will be provided by Chubb Insurance, covering all delivery and driver partners working with an Uber app.  This includes those driving a car, riding a bicycle or motorcycle, or walking.   Among the entitlements under the Policy is a $400,000 lump sum payout for accidental death or disability, up to $2,000 for fractured bones and up to $10,000 for funeral expenses.  Workers who are injured and temporarily disabled will receive $150 per day for up to 30 days, with a cap at $4,500.  An income supplement of $1,500 will also be available for bodily injury.

Debate remains however about Uber drivers’ entitlement to personal leave or sick leave.

We’ll continue to monitor the developments on this important topic.