That can be a very complicated web of confusion to untangle because Uber and Lyft do not operate as traditional transportation companies, they are technology companies who claim they are merely designers and providers of the app software used for the purposes of what is basically an army of independent contractors. They do provide some modicum of liability insurance to protect riders but it only applies when a driver working for Uber or Lyft has a passenger in their vehicle. When they are not carrying a paying customer, the companies’ insurance is essentially switched off.
Therefore, figuring out which insurance company is expected to cover any loss or injury in the event of an accident involving an Uber or Lyft driver can be difficult to ascertain. It all comes down to what is called “rideshare insurance periods”.
As Uber and Lyft drivers are using their own personal automobiles to provide a service, car insurance can be a challenge. Both companies highly recommend that drivers who work for the respective companies carry specific rideshare accident insurance, which has become a recently new type of coverage in the industry.
This is due to the “periods” that exist dictating when Uber or Lyft’s insurance coverage is valid and invalid to cover any loss or injury in an accident with one of their drivers. These are periods 0 through 3.
Period 0 is when a driver is operating his or her motor vehicle for personal reasons. Essentially whenever a driver is behind the wheel of his or her own car operating that vehicle for normal, personal use. Since we are all expected to carry car insurance in order to legally drive on public roads, the driver’s personal car policy is in effect should an accident occur.
Period 1 is when a driver has logged into the Uber or Lyft app and is driving around waiting for a pickup request from a rider. During this time, the driver is technically “on the clock” but is not yet working for the company. Therefore, the driver’s personal car insurance is still the valid applicable coverage.
Period 2 is when a driver has accepted a ride request, and driving to that rider’s current location to pick them up. For all intents and purposes, the driver is now working for Uber or Lyft and the company’s liability insurance has been triggered into effect.
Period 3 is when the driver has the passenger in his or her vehicle and they are en route to the rider’s chosen destination. The company’s insurance coverage is still in effect until the rider exits the vehicle at drop-off, after which the period reverts back to 0 once again.
Sounds somewhat simple, but there can be plenty of gray areas and confusion in the claim process as to file a claim and who can be held liable in the event of an accident during an Uber or Lyft ride or with a driver who does not have a passenger in the vehicle at the time of the incident.
It comes down to sufficient coverage as well as Uber and Lyft’s respective liability insurance policies and the limits and exemptions that exist.
So if you are involved in an accident with an Uber or Lyft driver, finding out which insurer will be expected to cover your costs due to loss or injury can be tricky. If you are a rider in the vehicle at the time of the accident or you are another driver who is collided into by an Uber or Lyft driver with the rider on board, Uber or Lyft’s insurance coverage should be in effect to deal with a claim.
But it’s during that period 1 where getting into an accident with an Uber or Lyft driver can be tough. Since the companies’ insurance policies are deemed invalid during those periods, you hope the driver is holding rideshare coverage as part of his or her personal auto insurance policy.
That’s because just about all car insurance providers insist that drivers who plan to work for Uber or Lyft purchase additional riders to their policies that are intended to cover them during the time they are on the road in their personal vehicle with the intent of picking up a rider as an Uber or Lyft driver. Insurers are not prepared to cover the costs for a motor vehicle that is, in essence, being used for business on a personal policy. This increases the risks that insurers are forced to take on with drivers who are using their vehicles far more than they might normally if they weren’t driving for Uber or Lyft.
As a result, the insurers want to charge extra premiums for covering these drivers while they are extending the time they spend driving around on the road. So if you get into an accident with a driver during period 1 and that person does not hold rideshare insurance, it could be the same as that driver having no car insurance whatsoever, even if he or she is otherwise insured.
If that happens, who do you turn to for compensation? Don’t expect Uber or Lyft to step up with a payout for your injuries, loss, and pain and suffering. Both companies categorize their drivers as independent contractors instead of employees. This puts all of the liability on the drivers should something happen.
What’s even more difficult is trying to reach either company should you be involved in an accident of some kind with one of their drivers. You can only reach the companies via their apps or through email or even via their social media accounts. Unfortunately, all of these venues are unreliable and challenging, by design.
Our team of legal experts are also skilled at knowing how to deal with the insurance companies despite the rideshare periods that might apply, so you’re not left wondering who will pay for your medical bills, lost wages, and pain and suffering.
Uber and Lyft provide comparable protection for their riders in the event of an accident, but how can you collect if you are pedestrian, a cyclist, a driver and passenger in another vehicle? These cases are where things can get complicated, but we know how to cut through all of these complexities to get you paid what you deserve.
Should any of these situations apply to the facts in your case, you may be able to prove clear negligence on the part of a property owner and/or employees, agents, or other individuals who have some connection to the property and its condition.