The firm was criticised for failing to provide adequate insurance required by law.
The news came amid a legal battle involving five Uber drivers charged with using a car for hire without a permit and driving without third-party insurance.
Their trial, a result of a police raid at the firm’s offices in August 2015, will resume next Monday.
A source close to Uber described the deal as a “milestone” for ride-sharing services in the city, saying it aimed to address the public concern over the issue of third parties insurance coverage.
“Uber hopes to offer peace of mind to all riders,” the source said, adding that the company had contacted many local insurers but to no avail.
However, a spokeswoman for Transport and Housing Bureau said that in addition to third-party insurance, private cars providing a service for profit must have a permit – the number of which is capped at 1,500 at present.
