Who Is Responsible In a Ride-Sharing Vehicle Accident?

January 16, 2015 | Attorney, Matthew Dolman
Who Is Responsible In a Ride-Sharing Vehicle Accident? Uber is company that helps people find local drivers who are willing to give others a ride for a fee.  All you need to do is download the app to find local drivers registered with Uber in your area.  The one issue that has yet to be fully decided is which insurance policy covers an accident where a passenger in an Uber or other ride-sharing car is injured. Most personal auto insurance plans will not cover ride-sharing accidents and might punish drivers if they find out you are a ride-share driver.  “[L]ast month, the San Francisco Chronicle uncovered Geico training documents detailing some of the consequences for customers who drive for ridesharing companies—including non-renewal and referral to the fraud unit. Allstate and State Farm have also stated that their policies do not cover ridesharing. And the story's the same at many smaller insurers, like Esurance.”[1] INSURANCE POLICY CONFUSION WHEN MIXING PERSONAL AND PROFESSIONAL USE  The issue of gaps in liability should be concerning for both passengers and drivers.  “Ridesharing companies like Uber insure drivers when they're picking up fares, and personal policies are supposed to cover moments when those drivers are waiting for customers. However, BuzzFeed News has learned that it doesn't work that way in practice -- and that's potentially a very expensive problem if you've signed up. While Uber says that ‘many' personal insurance plans safeguard its drivers in between rides, some of the largest US insurers (Allstate, Geico, Progressive and State Farm) say that these options won't cover ridesharing at any point. They may even cancel your policy if they find out that you're taking paying passengers. Moreover, both Lyft and Uber limit their liability for victims outside the car to $50,000. You could still rack up a huge medical bill if one of these drivers hits you while you're crossing the street. Commercial insurance can address those gaps. It's frequently much more expensive, however, and Uber frequently tells would-be drivers that they only need personal insurance. It's illegal to misrepresent how you use your car, too. You could face prosecution if you knowingly register a car for personal use when you're primarily picking up passengers, and even having commercial insurance on your personal ride could get you in trouble.”[2] EXCESS COVERAGE MAY BE NOT BE AVAILABLE DEPENDING UPON DRIVER ACTIVITY Another issue is the type of insurance that Uber and Lyft offer its drivers. “[I]f the Uber and Lyft policies are defined as ‘excess' coverage, drivers and their passengers risk not being covered at all, said Bob Passmore, a senior director of the Property Casualty Insurers Association of America.  Personal auto-insurance policies typically have exemptions for commercial activity, he said, and excess coverage kicks in only if a primary insurance plan is in place.  ‘They have to have coverage that's specific to this activity because a personal auto policy doesn't do it,' he said.  Uber's policy would cover drivers as a primary insurer if a driver's individual policy would not, said James Ondrey, general manager for Uber Ohio.”[3] This means that “even if you have an accident between Lyft or Uber rides, you'll need to file a claim with your provider first—and have it denied—before the ridesharing company will step in. And ridesharing companies' limits in these cases are relatively low. They're unlikely to cover a serious accident.”[1] In sum, what have we learned?
  1. Driver's for ride-sharing companies are allegedly covered by the ride-sharing company when they are available for rides or have a passenger in their car.
  2. The amount of coverage differs depending on if you have a passenger in your vehicle or not.
  3. Some ride-sharing companies may not cover an accident if you are in between rides, and your own personal insurance company may not cover your if you are in between rides, leaving you exposed.
  4. If your personal auto insurance policy finds out they you are a ride-share driver, your auto insurance company may cancel your policy or force you to buy commercial auto insurance.
  5. Driving with commercial auto insurance as a ride-share driver is the best way to keep yourself covered.
This issue is far from settled as local governments and insurance companies play catch up with modern technology.  As always, your best bet is to consult your attorney before starting any business venture no matter how small.  Furthermore, it is wise to make sure that you have the appropriate insurance coverage in all circumstances. If you or a family member was involved in a ride-sharing accident, please feel free to call the Dolman Law Group Accident Injury Lawyers, PA.  The Dolman Law Group Accident Injury Lawyers, PA has a track record of success when it comes to auto accidents. The Firm has offices in Clearwater and Saint Petersburg where consultation are always free.  Speak to an attorney to be aware of your rights. Dolman Law Group Accident Injury Lawyers, PA 800 North Belcher Road Clearwater, FL 33765 727-451-6900 [1] Alice Holbrook, Everything You Need to Know About Ridesharing Insurance, Nerd Wallet, Jan. 6, 2015 at , https://www.nerdwallet.com/blog/insurance/2015/01/06/guide-to-uber-lyft-sidecar-insurance/. [2] Jon Fingas, Ridesharing Insurance Leaves Many Drivers in the Lurch, Engadget, Dec. 23, 2014 at , https://www.engadget.com/2014-12-23-ridesharing-insurance-gaps.html (last visited Jan. 8, 2015). [3] Rick Rouan, Who's Liable in Ride-share Accidents?, The Columbus Dispatch, Mar. 4, 2014 at available at https://www.dispatch.com/content/stories/local/2014/03/04/whos-covered.html (last visited Jan. 8, 2015).


Matthew Dolman

Personal Injury Lawyer

This article was written and reviewed by Matthew Dolman. Matt has been a practicing civil trial, personal injury, products liability, and mass tort lawyer since 2004. He has successfully fought for more than 11,000 injured clients and acted as lead counsel in more than 1,000 lawsuits. Always on the cutting edge of personal injury law, Matt is actively engaged in complex legal matters, including Suboxone, AFFF, and Ozempic lawsuits.  Matt is a lifetime member of the Million Dollar Advocates Forum and Multi-Million Dollar Advocates Forum for resolving individual cases in excess of $1 million and $2 million, respectively. He has also been selected by his colleagues as a Florida Superlawyer and as a member of Florida’s Legal Elite on multiple occasions. Further, Matt has been quoted in the media numerous times and is a sought-after speaker on a variety of legal issues and topics.

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