Insurance premiums for taxi drivers in Toronto have increased so much, that some have threatened to stop driving altogether due to the steep costs.
“I maybe make about $80 a day,” taxi driver Thomas Tuah told CBC News in a recent interview. “I have a family. I have a home to pay for.”
Tuah then revealed that his commercial vehicle insurance fees have jumped by a whopping $3,000.
“Maybe I’ll make more money collecting welfare than even driving a taxi,” the man commented, adding that the steep hikes are making him think twice about continuing as a taxi driver.
Another driver also commented about his plight, telling the news outlet his insurance will spike to nearly $12,000 for comprehensive or all-perils coverage.
“I was paying like $5,200 for all perils. How will I pay this? So many guys are thinking of giving up their plates,” said driver Gary Khan.
In a written statement, the city of Toronto explained that there have been no changes to the city’s insurance requirements for vehicle-for-hire drivers.
But Philomena Comerford, who serves as president and CEO of Baird MacGregor Insurance Brokers LP, explained that insurers have no choice but to raise premiums on taxi drivers due to the large number of claims this year, as well as the rising costs of repairs.
“Taxis have always been a difficult class of business,” Comerford told CBC News.
“They would be considered high risk. And unfortunately, because they’re driving in downtown conditions and a lot of congestion, there are a lot of accidents involving pedestrians and cyclists.”
Comerford added that taxis are not just at the highest risk and the most expensive to insure; they are also taking the brunt of what Ontario insurers are dubbing a “very challenging year,” with all auto insurance premiums taking a hit – some harder than others.
“Results have not been good in Ontario auto and when results in Ontario auto are bad, it’s like they sneeze and everybody else gets a cold,” she explained, adding that the rate hikes have also affected tow truck operators.
“So, we’ve got kind of a perfect storm going on right now in the industry.”