Taking a Lyft or an Uber is often less expensive than hiring a taxi, and it is extremely convenient. However, riders should understand that if the driver is in an accident and there are injuries, there is not necessarily a guarantee of medical coverage from the driver’s insurance.
Although rideshare drivers are liable for accidents they cause, they may not have enough insurance coverage. Drivers, especially, may be responsible for paying for their own injury expense if there is not adequate coverage.
Personal insurance responsibility
According to the Insurance Information Institute, driving for a rideshare company means that a driver is using the vehicle for business purposes, which changes coverage purchased from a personal auto policy. A personal policy covers property and bodily damage that occurs when the driver is using the vehicle for personal reasons.
As an Uber or Lyft driver, not only are they driving more miles than for personal reasons, but the passengers in the car are customers. Once the rideshare app is on, personal policies do not cover any accident caused during this time, although it resumes once the driver turns the app off.
Rideshare company insurance coverage
According to 9News.com, Lyft and Uber do provide vehicle insurance for drivers. It can be quite generous; however, it only covers drivers when there is a customer in the car. If the driver causes an accident while waiting for a request, there is only basic liability coverage, which does not cover the driver’s injuries.
Fortunately, many insurance companies now offer rideshare insurance coverage that drivers can add on to their existing personal policy. If a driver has this, there should be sufficient coverage for damage and injuries whether or not there is a customer in the vehicle.