Ride-sharing services are a great example of how the use of technology makes getting around even easier. They also help combat drunk and drowsy driving accidents – but unlike taxis, which are regulated by the government, services like Uber and Lyft are often a bit murkier in terms of their policies and how you are protected. Before getting in someone else’s car, learn how you are covered in the event of an accident while riding in a taxi or Uber.
We currently represent a woman who was in an Uber that collided with another vehicle. The driver was a friend of hers, but was logged into the Uber app at the time, according to our client, and she was paying for the ride. The driver claims his app was not open and that the ride was free. (No Uber receipt was provided to our client and the charge did not appear on her credit card statement).
Our client’s driver had liability coverage with State Farm. We notified State Farm of the claim for injuries, and we also notified Uber. State Farm’s position is that Uber’s liability coverage is primary, and their coverage on the driver’s personal automobile coverage is secondary.
The case is not in suit. However, once it goes into suit, one of the issues that we will need to determine in discovery is whether in fact the driver’s Uber app was open at the time of the collision. In other words, we will have to get the receipt, and other electronic information, from Uber to determine if the driver’s app was on at the time of the collision and whether the ride was for a fee. If so, that would indicate that the Uber liability coverage is in play and primarily responsible for the accident.
Learn more about Uber Driver’s insurance coverage
How Uber Drivers are Insured
In a taxi, you are covered under the Public Utility Commission, however very minimally. If you are involved in an accident while riding in a taxi, the taxi company’s insurance does not have a large allowance to cover damages and medical bills. An Uber, Lyft, or other ride-sharing service is considered a private car service, and therefore is not covered under the Public Utility Commission. Primarily, you are covered by your own auto insurance coverage. Without your own coverage, you are covered by your Uber driver’s insurance policy, and by the Uber company’s insurance coverage.
Keep this in mind when purchasing your car insurance. Your policy should have plenty of Uninsured and Underinsured Motorist Coverage (UM and UIM). This covers you in the event that the other driver, whether it is your Uber driver, taxi driver, or the other driver involved in your accident, does not provide sufficient coverage. If you are going to get in someone else’s car, at least make sure that you have sufficient coverage, because the driver may not.
This becomes important because Uber provides its drivers with three different levels of liability coverage, depending on whether they are driving to pick up the rider (Period Two), or have a rider in their vehicle (Period Three).
During period one, Uber provides:
- $50,000 coverage for bodily injury per person, with a maximum of $100,000 per accident (applicable if the driver is waiting for the app to connect them with a customer)
- $25,000 coverage for property damage per accident ( if the driver is in route to pick up the customer)
- $1 million bodily injury and property damage coverage per accident )for accidents where the driver is in route AND where the driver has a customer in his/her car.
If an Uber driver is not logged into the app, the driver’s own (personal liability) coverage applies.
How Ride Sharing Services are Changing the Auto Insurance Industry
At least two insurance carriers, Geico and Progressive, have begun to offer Uber drivers in Pennsylvania (and Lyft drivers) with “hybrid” automobile insurance policies that provide coverage for drivers. A hybrid policy costs more than the typical personal automobile insurance policy, but not quite as much as a commercial policy.
If these policies require a selection of full versus limited tort coverage, it is always our recommendation to buy full tort coverage. The same would be true for adequate amounts of Uninsured Motorist coverage and Underinsured Motorist coverage. The reason a hybrid policy is required is because if you use your private passenger motor vehicle for commercial purposes, your insurance carrier can disclaim coverage. In other words, if you drive and get paid to do so, you cannot be insured on a regular policy of car insurance. You insurance carrier has the right to charge a higher premium rate for commercial drivers.
Click here to learn more about your safety in an Uber.
If you have questions about your insurance policy and how it will protect you in the event of an Uber or Lyft accident, you can contact Carpey Law for a free insurance policy review.