Concerns about insurance coverage for UberX drivers are generating controversy in Toronto’s taxi industry.

While UberX does not require its drivers purchase commercial insurance, the company does ensure they have liability insurance.

“Every ride on the UberX platform in Canada is insured by $5 million in contingent auto liability insurance covering bodily injury and property damage,” said Uber Canada spokesman Susie Heath in an e-mailed statement.

UberX is a freelance cab company which operates without the stringent regulations imposed on cab firms. UberX is separate from its parent company, Uber — which operates in a similar manner to a cab firm.

Joel Barr, a cab driver with the Toronto Taxi Alliance, complained UberX can offer passangers low prices because drivers don’t pay for the commercial insurance that is mandatory for cabbies.

They’re using private insurance for actions that are commercial in nature, Barr claimed.

The price difference between private and commercial insurance is thousands of dollars annually, he said.

Barr wants to see a more level playing field between traditional taxi and UberX drivers.

“We welcome competition, but go by the same rules we’ve been regulated by for years,” said Barr.

“You can’t have us going by one set of rules and another company from the United States, taking all the profits back to the U.S., playing by another set of rules,” said Barr. “It’s a shame.”

Insurance broker Philomena Comerford, CEO of Baird-MacGregor insurance company, said carrying paying passengers is a commercial — not a personal — activity.

“There are certain activities that are excluded in the standard Ontario automobile policy and one of (them) is carrying paying passengers,” she said. “The cure for that is to put an endorsement on the policy that permits that,”

Comerford said while cabbies have to obtain commercial insurance, Uber does not impose the same requirement on its freelance drivers.

“It could end up being really ugly,” she said, referring to potential lawsuits arising from accidents.

“Most (UberX drivers) probably don’t understand the limitations of their policies, which is unfortunate,” she added.

A driver with a Canadian Automobile Association personal auto insurance policy is not covered to transport passengers for payment, added CAA spokesperson Silvana Aceto.

“The standard auto policy, used by all insurers, excludes coverage for vehicles transporting passengers for compensation,” she said.