The popularity of ridesharing companies such as Uber and Lyft means more opportunities for drivers, but with more for-hire vehicles on the road the chances of having an auto accident while driving a rideshare customer increase. That means Uber drivers should know if they're covered by insurance before getting behind the wheel.
So what are the insurance options for drivers? It depends a lot on the ridesharing company and the driver's own insurance.
“I was involved in an accident while driving for Lyft, and called the insurer ,” says Christopher Lin, a Lyft driver based in Oakland, California, and the author of the book “10,000 Rides: My Illustrated Journal of Uber, Lyft & Sidecar.” Lin says the claims adjuster informed him that there are hundreds of claims daily, but that "most of the people who call in end up using their own insurance because of the super high deductible.”
For Lyft, the collision deductible is $2,500, and for Uber, it's $1,000, Lin notes.
“Lyft actually de-activated me immediately until I had an inspector send pictures of the repair,” he adds. “It's a bit irritating, since I didn't even use their insurance, I used my own.”
While there are no studies on the topic of rideshare drivers and auto accidents, Lin believes the average accident rate must be higher than for regular drivers, “due to the fact you literally use your phone and stare at your GPS while driving.”
Industry experts advise rideshare drivers to tread cautiously around auto insurance, and recommend they fully know their coverage.
“Unlike a taxi driver, a majority of rideshare drivers are considered independent contractors, not employees, so their auto insurance is personal,” says Frank Petrane, Vice President of Fleet Sales for Driven Brands, in Charlotte, North Carolina.
Commercial insurance: Uber drivers covered
If you’re a ride sharedriver involved in an accident, there are specific steps you should take (starting with getting immediate medical attention if any party in the accident is injured.)
For insurance purposes, start by knowing the rules, says former insurance executive John Cross, a faculty member in the Finance Department at Cal State Fullerton, who teaches a course titled Finance 461: Property and Liability Risk Managemen.
“Really, it's the same outcome whether you are a rideservice driver or simply a private motorist,” Cross explains. “The rideshare concept doesn't alter the law of legal liability of the owner or driver of the vehicle. Basically, if a driver is 'at fault,' in the accident, the driver is legally liable for any property damage or bodily injury caused by the vehicle he or she owns or is driving.”
7 post-accident tips for ridesharing drivers
Once you know the law, Cross advises applying some "common sense" tips immediately after an accident. He lists them as follows:
1. Safety first. It's best, if possible, to leave vehicles in their post-accident position until police arrive, but move them if this creates a hazard.
2. Check all parties for any apparent injury. Help out if needed and if you can, but understand that you're on the scene as an emergency professional or doctor.
3. Call the police. Depending on the local area, law enforcement policy and the type of accident, police may come to the scene or they may (for minor accidents in some jurisdictions) tell the operators to exchange information and handle the matter on their own.
4. Exchange paperwork. Provide information to the other party and obtain it from them, regardless of who seems to be at fault. Make sure to include owner/driver name, address, telephone number, insurance company and policy number.
5. Keep as calm as possible. In general, don't get into a discussion about the accident with the other party. Stick to the facts as you know them. Don't embellish the facts and don't give opinions. If you don't know something, say you don't know.
6. Be cautious. Note that anything you say at the auto accident scene is admissible as evidence. Consequently, it's best not to say anything, other than to provide the facts, as you know them, when asked by the police officer who comes to the scene.
7. Know what your rideshare company offers. Virtually all rideshare companies offer auto insurance for their drivers. Note that most personal auto policies exclude coverage if the insured car is being used to "carry a person for a charge." The idea is that if you're transporting other people for money, there's a bigger exposure and you ought to have a commercial insurance policy that covers you for this.
The moral of the story? If you’re in a ridesharing fender-bender, or full-blown accident, know the key steps unique to Uber, Lyft and other auto rideshare firms beforehand.
Your ridesharing future may well depend on it.