Skyrocketing Auto Insurance Rates Impacting Taxi Drivers

Taxi drivers are speaking out, saying car insurance rates have skyrocketed, leading some to hang up their keys.

The increase in the insurance rate, which some say is three to four times what they used to pay, is forcing some Waterloo taxi drivers to walk away from their cabs.

“We used to pay about $3,000 a year, now we’re paying $11,000, $12,000,” said Radenko Ivanisevic, taxi owner with City Cabs in Kitchener.

Ivanisevic has been driving taxis for 15 years and says it is now getting too expensive to continue.

“It’s really hard to pay the bills and make money,” Ivanisevic said.

Some drivers say insurance companies in Ontario no longer insure commercial drivers at a reasonable price.

“It really hits the bottom line,” said JT Pearson, office manager at City Cabs.

Pearson believes the rate increase is because insurance companies can make a better profit and margin on those doubled premiums.

Pearson says commercial drivers are now forced to purchase facilities insurance as a last resort. As a rule, this is insurance intended for the most at-risk drivers.

An email from the Ontario Ministry of Finance to CTV News said in part: “The government is aware of the current issues regarding the availability and affordability of commercial taxi insurance and has been working with industry players. taxis and insurance to discuss these issues and identify potential ones. solutions. Taxi insurance is a specialized product. As such, its price reflects the higher risk nature of the service (such as long hours on the road, multiple occupants, accidents involving pedestrians and cyclists, etc.), as well as the cost of claims experienced.

In recent years, insurers have reported that the frequency and severity of taxi-related claims are significantly higher than those of other lines of commercial auto insurance, leading to higher premiums, the ministry said.

These fare increases have resulted in at least one City Cabs taxi driver hanging up his keys.

“He knows what his insurance rate will be after he comes out of this experience, and working the numbers, the margins don’t make sense to him anymore,” Pearson said.

The Insurance Bureau of Canada said the increase is due to increased claims from commercial drivers.

“The cost of claims and insurance in Ontario is near the highest in the country, and we would all like to see the cost of claims come down,” said Anne Marie Thomas of the Insurance Bureau of Canada. “If the cost of claims goes down, rates can stabilize.”

The added expense of insurance means taxi companies are pivoting, resulting in higher fees for customers, the sale of buildings or complete closure.

Ivanisevic said he wants fair insurance so he can continue doing the job he loves.

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