TORONTO -- Ontario's insurance regulator has approved coverage for drivers using ride-hailing services such as Uber, even as the province's legislature has yet to decide if such services are legal.

The Insurance Bureau of Canada says the new insurance offering is the first coverage of its kind in the country.

The Financial Services Commission of Ontario gave Aviva Canada the green light to offer coverage for drivers carrying paying passengers in their own vehicles.

Aviva says it is fulfilling a clear customer need.

"There are a lot of people out there trying to make some extra money, and that's a great thing, but they're doing it without the appropriate coverage for themselves and for their passengers as well," said spokesman Glenn Cooper.

But at the moment such drivers are also doing it outside the confines of the law.

The Ontario legislature is set to consider a bill that would make Uber, AirBnB and other services in the so-called sharing economy legal. Progressive Conservative Tim Hudak's private member's bill passed second reading in the fall but has yet to go before committee to be studied.

Finance Minister Charles Sousa said Aviva's offering "is a step in the protection of consumers and that's not a bad thing," but more has to be done to ensure consumers are protected and businesses have a level playing field.

Municipalities such as Toronto and Ottawa are also re-examining their own taxi bylaws.

Toronto recently gave Uber a taxi brokerage licence for its taxi service that connects riders with cab drivers in the city through a mobile app, but the move did not affect the company's controversial cheaper service, UberX, that connects riders with drivers not licensed as taxis.

The taxi industry -- which has staged many protests against Uber -- says the ride-hailing company is operating illegally and therefore those drivers shouldn't be able to be insured for that activity.

"We are very concerned that an Aviva announcement that 'an approved product exists and is available for purchase' will be misconstrued by politicians to mean '20,000 illegal UberX drivers are now insured,' Toronto Taxi Alliance president Gail Souter and Canadian Taxicab Association president Marc Andre Way wrote in a letter to Aviva.

Aviva's coverage is an addition to its personal auto policy and will be available to drivers licensed for at least six years, who spend up to 20 hours a week participating in ride hailing, and for a maximum of eight occupants. The policy will cover drivers from when they initiate looking for passengers through to collecting and dropping off those passengers.

Aviva says it will be working with regulators across the country to make this insurance available in other provinces.

Edmonton just approved a bylaw to allow companies like Uber to operate legally.

Uber Canada said it hasn't reviewed Aviva's policy, but it is encouraged to see interest from insurers.

"Uber and Intact have been working with provincial regulators for a number of months and Intact has completed their full submission for approval," said spokeswoman Susie Heath.