Understanding Rideshare Drivers and Accident Insurance

Rideshare companies like Uber and Lyft have increased in popularity. With the soaring popularity, the odds of an accident with an Uber or Lyft driver increases. If you’ve been involved in an accident with a rideshare driver, there are some important details to know about rideshare drivers and insurance.

Do Rideshare Drivers Have Insurance?

Most drivers carry personal auto insurance, as is required by law. After a car accident, you typically file a claim against the other driver through his or her personal insurance policy. The insurance company is responsible for paying your medical expenses and damages.

The problem with personal auto insurance coverage and rideshare drivers is that most personal insurance policies have a business use exclusion. This means that the coverage won’t apply if the driver uses the vehicle for business purposes. When an Uber or Lyft driver picks you up, his or her liability and collision coverage may not be valid.

Some drivers do have auto insurance to include business use. If the driver doesn’t, however, Uber and Lyft both carry liability policies for drivers. This policy includes damages of up to $1,000,000. While you might think that this is more than enough, drivers may not be entitled to all $1,000,000.

How Does Rideshare Coverage Work?

If the driver is not covered for the full $1,000,000 then what is he or she covered for? Rideshare companies categorize drivers by periods that range from 0-1. Period 0, for instance, is when a driver is not logged into the app at all. When a driver uses his or her vehicle for personal use, no coverage is offered.

Period 1 is when a driver is logged in but has not accepted a ride. In this case, he or she may have coverage from $50,000 to $100,000. In period 2, a driver is on his or her way to pick up a rider. In this case, the driver has a boost of coverage up to $1,000,000. In period 3, the rider is in the vehicles and the policy extends to $1,000,000 plus limited coverage for uninsured motorist coverage.

Rideshare companies are convenient and have become incredibly common in cities and towns across the country. If you are in an accident with a rideshare driver, the big difference between an accident with a rideshare driver and any other driver on the road is the insurance coverage. For clarification on insurance and claim concerns, contact a car accident lawyer, such as from John K. Zaid & Associates, today.