There are a number of valid arguments on both sides of this issue, but my take is that this business model isn’t a very sound one and won’t last long. The problem is that it relies on a steady pool of “workers” who are engaging in something that is often prohibited explicitly under the terms of their insurance policies. At some point this risk is going to be priced into the business model at different points in the transaction chain (the price that drivers are willing to accept to pick up a ride, the supply of drivers, etc.), and I’m not sure a company like Uber will survive once that happens.
I think the only activity that is prohibited under the insurance policy is the time of the paid ride. And from what I understand, Uber's own insurance takes over at the start of the fare and ends when the customer is delivered to the destination, whereupon the driver's own insurance coverage returns to force.
Pretty sure that by taking a fare, the driver's insurance won't cover an accident while transporting and delivering that fare. But it doesn't invalidate the policy - and if I was an insurance company, I'd have been knocking down their door to offer coverage for during the fare - likely get a very disproportional return on my money for very low risk.