Ridesharing apps like Uber and Lyft provide an efficient and ubiquitous means of transportation—more than 14 million trips are completed each day via Uber alone—but there is always the potential for injury, as with any time someone drives or is a passenger in a vehicle.
There are very few details as to how many accidents involve ridesharing drivers, or even how many such drivers are on the road. But in Sacramento County alone, there were over 3,000 car accidents resulting in injuries or death in 2017, and some percentage of those accidents involved ridesharing services.
If you’ve been involved in a crash and injured as a passenger in an Uber or Lyft ride, then you’re likely wondering what steps you need to take to get compensation. It’s important to understand rideshare insurance policies because they affect who you can go after for damages. If you’re thinking about suing Uber or Lyft to recoup damages, things can become quite complicated.
Contracted Uber and Lyft drivers are required to have personal auto insurance—both rideshare companies also offer their own policies—but the level of coverage depends on whether a driver is ‘on the clock.’
In California, rideshare drivers are required to meet minimum insurance requirements in order to drive for transportation network companies (TNCs). This requirement includes four “periods” of coverage. Each period depends on the driver’s driving situation, including if a passenger is in the vehicle or not.
Period 0: When the rideshare app is off and there are zero passengers in the vehicle, the drivers’ car must meet California’s minimum insurance requirements. In this case, the driver must possess at least:
- $30,000 of bodily injury coverage per accident
- $15,000 of bodily injury coverage per person per accident
- $5,000 of property damage per accident
In effect, Period 0 insurance does not distinguish between rideshare drivers and the general motorist population.
Period 1: When the drivers’ rideshare app is on and they’re waiting to be connected with a passenger, California law mandates that insurance coverage be increased.
- $100,000 of bodily injury coverage per accident
- $50,000 bodily injury coverage per person injured in an accident
- $30,000 of property damage coverage per accident
Rideshare drivers can obtain Period 1 coverage through their own insurance, but they don’t have to. If the personal auto coverage does not cover the above requirements, then Uber and Lyft are required to provide Period 1 insurance. In either case, when a rideshare drivers’ app is on, their car must be covered under Period 1 insurance.
This coverage is necessary for accidents involving pedestrians, bicyclists, and other cars. If you’re a pedestrian, bicyclist, or motorist injured by an Uber or Lyft driver with no passengers in the vehicle, you will need to determine if the driver has Period 1 coverage through their personal insurance or through the rideshare company. You can then seek to recoup any damages that you incurred through the correct insurance provider.
Period 2 & 3: When a match has been accepted, the driver is en route to pick up the rider, and a passenger is in the vehicle. During this period, coverage may be satisfied by either the driver’s personal TNC auto insurance or the rideshare companies’ TNC coverage. The requirements are significantly increased during these periods. The coverage includes:
- $1 million dollar commercial liability insurance coverage
- $1 million dollar uninsured and underinsured motorist coverage
- Contingent comprehensive collision coverage
Insurance requirements become more stringent as users hail a ride and actually step foot inside the rideshare vehicle.
Even as a rideshare passenger, you should still collect information from the drivers involved in the crash and document the scene by taking photos.
When you’re driving your own car and are involved in an accident, you should always move your vehicle to safety and collect information from the other driver, including their insurance information, driver’s license number, license plate number, and pictures of both vehicles.
When you’re a passenger in a rideshare vehicle that is involved in a crash, you should follow the same steps as if you were driving. While on scene of the accident, you have to collect information from your rideshare driver and the other driver(s) involved in the accident. Be sure to inquire with your rideshare driver about his or her car insurance. Ask them if the primary insurance covering their vehicle is their personal insurance, or the rideshare company’s policy.
Obtaining a police report can help determine who is at fault, and also ensures you have a verifiable record of what happened on hand. Though calling the CHP is not necessary when damages are minor, if you feel the injuries you’ve sustained are extensive, or the car damage is extensive, contact the police so that you can document the accident.
If you are injured, be sure to visit the hospital immediately to receive all necessary medical care. Delaying care can be detrimental to your case, as insurance companies can argue that, by delaying care, your injuries did not result from the accident. If you are in a crash, it’s wise to seek medical attention right away, even if you don’t think you’ve suffered serious injuries.
If you sue the rideshare company, they can argue that they are not responsible because their drivers are independent contractors.
Rideshare insurance policies are rather straightforward: every driver is required to have the proper insurance, either through their own provider or from the rideshare company. Because Uber and Lyft drivers are required to have extensive policies, you should be able to obtain compensation for your injuries and other damages through the insurance company.
However, if your insurance claim is denied, or your damages exceed the driver’s coverage, do you have legal recourse to sue the driver or the rideshare company?
Uber and Lyft designate their drivers as independent contractors rather than employees, which is an important distinction. Employees have more rights than contractors—companies can be held liable for the negligence of their employees, but are far less likely to be held responsible for negligent contractors.
Uber and Lyft have worked diligently to maintain their drivers’ independent contractor status, enabling them to deny liability in cases where their driver is at fault, like they did in 2014 when a driver hit and killed a six-year old in San Francisco. If you have to file a lawsuit, you would sue the at-fault driver, not the rideshare company.
However, with California’s introduction of Assembly Bill 5 (AB5), it is unclear if rideshare companies can deny responsibility going forward. AB5 makes it more difficult for Uber and Lyft to classify their drivers as contractors. Though Uber and Lyft have restructured in order to conform to AB5 and maintain their drivers’ contracted status, there are cases currently pending concerning the rideshare companies’ liability. The law may be changing in the future.
If you were injured in an accident involving a rideshare driver, the lawyers at Penney and Associates can help. We’ve helped people all across California recoup damages owed as a result of a car accident. Contact us today to request a free consultation.