Taxi drivers in Alberta were put into a difficult spot after they were informed by their employer that there would not be any discounts on their fleet insurance.
When the provincial government of Alberta first issued physical distancing orders, taxi company Alberta Co-op Taxi Line asked its drivers to turn in their vehicle’s license plates and park their taxi cars until the situation improved. In turn, the company would suspend billing drivers for insurance payments.
But the taxi company later informed drivers in a letter that it could no longer afford to defer payments. In the letter, Co-op Taxi general manager Uday Kumar told owner-drivers that as of May 01, 2020, the company would no longer be offering them insurance discounts in the form of payment deferrals. The taxi company explained that this was because it had not yet received any word from its insurer, Intact Insurance, about any discount on fleet insurance costs. The company also mentioned that it had grounded 85% of its fleet due to the pandemic, and that management was finding it difficult to balance the operational costs of having to pay insurance for them all without discounts.
One of the drivers, Edmonton-based Abdul Qureshi, said that not having to pay for his vehicle’s insurance – which could cost hundreds of dollars monthly – has been a relief during this pandemic. But the letter changed all that.
“When I got that letter it shocked me and I said, ‘Oh my God.’ I mean, that scared me,” he told CBC News.
“I’m not working; my car is in the garage; why am I going to pay that insurance for nothing?”
Qureshi added that instead of paying about $50 a month to park his cab, he would have to pay the full insurance cost of about $540. He later contacted Co-op Taxi, and was given two options – either pay the amount or surrender the plates for good and leave the company.
He chose to leave the company.
Qureshi maintained that he is more fortunate than some, since he owns his own vehicle. But that would mean he would have to start again, and will have to pay new fees to operate again as a taxi driver.
CBC News spoke with several other drivers who shared similar complaints, but chose to remain anonymous out of fear of being fired.
An insurance discount was finally offered to Taxi Co-op, but not before drivers like Qureshi had already left.
The taxi company’s general manager Uday Kumar told CBC News in an interview earlier this week that he had reached out to Intact Insurance in mid-March, and only heard back last week – after he had sent the letter to the company’s drivers.
According to Kumar, Intact Insurance finally decided to charge only $124 a month per license for insurance. This revised premium is based on the number of vehicles on the road, the general manager explained.
Out of the company’s 557 taxi vehicles, 427 are parked. Kumar said that the company could not afford to pay insurance for all of the grounded taxis.
“We are obligated to pay this commercial insurance because it’s fleet insurance,” the general manager said.
