This is the real thing to highlight <| sep |> Don ' t taxis have an expensive license and insurance they have to pay that Uber doesn ' t because they are a service that connects you to drivers and not a taxi service ? That is a frequent point of contention between UberLyft and the various states the operate in . The states say look , we have this system of licensing and registration in place to make sure that taxi drivers are competent drivers , their vehicles are well maintained , and that people ' re not getting a ride from Ted Bundy when they hail a cab , and you , Uber , are circumventing all that and costing us revenue on lost registrations and inspections . You ' re also encouraging your employees to break the law . Uber responds with we ' re just a service connecting people who need a ride with people who are willing to give one . We don ' t actually have any employees behind the wheel , and the legal status of the ride really isn ' t our concern . Also it ' s not our fault your cabs suck and are expensive . what happens when they have vehicle repairs or accidents ? Unless they went out of their way to purchase special taxicar for hire insurance the driver is utterly fucked . Their insurance company will flat deny 100 % of any claims resulting from such an accident , be it damage to the driver ' s car , other carsproperty , or injury to any driver or passenger . The only recourse for injured parties to get any compensation would be to sue the driver directly . Depending on the circumstances and location of the accident , the driver might also be citing for something like Operating a Taxi without a license in addition to any other citations .