Uber drivers operating without the correct third party insurance or licence could be financially ruined if their vehicle is in an accident and causes injury, the Department of Transport has warned.
Radio 6PR has revealed the riding sharing company has not insisted all its drivers obtain the omnibus licence or commercial vehicle third party insurance which the state government introduced as law in July – prompting fears many are driving illegally, without realising.
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How do I know my driver is appropriately insured?
Iain Cameron from On-demand Transport explains how to find out what cover your point to point driver has. Audio: 6PR.
The new regulations were designed to legalise ride sharing services and level the playing field between the struggling WA taxi industry and the increasingly popular Uber service.
Department of Transport on demand general manager Iain Cameron, however, said many of Perth's more than 3000 Uber drivers were driving at risk and would soon be fined if they failed to hold the correct paperwork.
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"In the event of an injury collision... the Insurance Commission will cover all injury costs... everyone will be covered, however if the driver or owner of the [Uber] vehicle was found to be the third party, the Insurance Commission will then proceed to reclaim the cost of those crashes," he told Radio 6PR's Mornings program with Gareth Parker.
"If you're not correctly insured, you risk losing your entire business and any other financial assets that you have because a personal injury claim could be tens of thousands, to hundreds of thousands, to life time care so it's a risk not worth taking."
The state government in July introduced new laws that require Uber drivers to hold an omnibus licence, which costs $272, and obtain commercial third party vehicle insurance, at an additional cost of around $110 to $140 a year on top of private vehicle insurance costs.
Authorities cracking down on Uber hot spots have begun pulling over and cautioning "a significant number" of Uber drivers who have not complied with the requirements.
"After a period of education to educate people coming into this industry, we are now issuing cautions and once a caution is issued they're in our system, if we speak to them again, the very next instance is a risk of $500 infringement," Mr Cameron said.
"So for a $400 licence and insurance cost, it's going to cost you $500 for every offence."
Uber WA general manager Tom White said the company did not require drivers to provide them with proof of an omnibus licence but were required, 'if a new driver walked into their support office today', to provide a copy of their third party commercial vehicle insurance.
"We expect every driver partner to be fully compliant with the government's regulations, but whether or not we see a piece of paper [for the omnibus licence] does not enhance the safety situation of any rider that gets into a car or any driver that sits behind a wheel," he said.
"These are [drivers] doing less than 10 hours a week on average... and when they walk through the door and are confronted with an upfront cost in excess of $750 to hit the road, for many of them, that's simply not possible.
"A big chunk of that is the omnibus licence, it has become, since it took effect in July last year, nothing more than a tax on them to seek flexible work."