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Uber gets insurers up to speed on ride-sharing coverage options

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Online ride-sharing application Uber has grown from a fleet of 12 cars in one city to an international phenomenon with thousands of cars in 303 cities in 56 countries.

Along the way, Uber Technologies Inc. has had to solve numerous insurance challenges, some with the help of the industry.

“It's been an education effort to explain to people how this all works,” said Gus Fuldner, head of insurance at San Francisco-based Uber, referring to both regulators and insurers.

He made his comments during the Risk & Insurance Management Society Inc.'s annual conference in New Orleans, where Uber made its latest service launch in mid-April.

Uber began in San Francisco in 2010 with Uber Black sedan service and expanded into lower-cost solutions with Uber X, as well as into larger vehicles with Uber XL and Uber SUV.

The company now fields “thousands of cars online at the same time” in New York throughout the five boroughs, covers 68% of the U.S market by population and makes over 1 million trips a day worldwide, Mr. Fuldner said.

According to a study by Certify Inc., Uber accounted for 29% of all rides being expensed for business purposes in the U.S. during the first quarter of 2015, up from just 9% in the first quarter of 2014, Mr. Fuldner said.

“That certainly makes for an interesting set of tasks as a corporate risk manager for Uber,” Mr. Fuldner said.

“I spend a lot of my time on public policy,” he said of regulation and legislation.

Mr. Fuldner also has worked with insurers to establish mutually agreed-upon insurance coverage, including United Services Automobile Association, State Farm Mutual Automobile Insurance Co. and Allstate Corp. and has seen interest elsewhere.

“We're also seeing a lot of these big personal auto carriers start looking at ride-sharing market opportunities,” he said. “They're looking at this as a growth market, creating products specifically targeted” for the industry, he added, citing Geico and Metromile Inc., a smaller, pay-per-mile insurance company.

“I see carriers looking at this as a way to get additional premiums and product differentiation,” Mr. Fuldner said.

Established rideshare coverage limits compare favorably with those required for taxis, he said.

In New York, for example, taxis are required to carry $100,000 bodily injury coverage with a $300,000 aggregate limit, compared with the $1 million in combined single-limit third-party liability threshold set for rideshare applications in many jurisdictions.

Further, riders can actually see a copy of the policy maintained for drivers on the company's website, Mr. Fuldner said.

“Technology is changing the way we do a lot of things, specifically today around transportation, and you see there are a lot of entrants into the space that are trying to use technology to make transportation a better experience, a more efficient experience,” said Randy Nornes, executive vice president at Aon Risk Solutions in Chicago, who moderated the discussion.

Other sharing business that technology has found its way into include the lodging industry's Airbnb and dog boarding website Rover.com, he said.