Legally, hailing a cab and catching an Uber ride may be very different. When you download Uber’s app you automatically agree to their terms and conditions which often are not clearly understood. Certainly very few people likely realize that they are agreeing that any legal dispute with Uber must be settled by a court in Amsterdam.

Perhaps more importantly, in the eventuality of an accident, the legal fallout is uncertain. In Ontario, motor vehicle insurance is mandatory however most basic insurance does not cover commercial activities such as carrying paying passengers. How much insurance, if any, would be available to compensate an Uber driver, passenger or even someone hit by an Uber vehicle is not clear.

The Insurance Bureau of Canada, which represents the major Canadian insurance companies, has issued a stern warning to riders about the potential hazards of taking such rides. According to the Bureau, carrying passengers for payment could nullify some of the driver’s rights to auto insurance coverage.

Until clear insurance terms are set for Uber drivers and riders, there will always be some level of risk and uncertainty to all the parties. The promise of convenience and quick savings may be a big price to pay.