Ride-sharing services are on the rise, but they may not be as safe as they say. After a deadly accident involving a ride-sharing driver in California, questions are being raised about who pays when something goes wrong with this new carpooling technique.
An article from the LA Times discusses how companies such as Uber, Lyft, and Sidecar have previously insisted that the insurance provided to drivers is sufficient to cover accidents, but there is new light shed on the murky legal waters that these taxi-like services operate in.
On New Years Eve, according to the article, an Uber driver hit and killed a 6-year-old child who was crossing the street with her family. It is unclear whether Uber is liable for this fatality.
Uber initially distanced itself from the accident, insisting that the driver was not covered by Uber’s insurance policy at the time of the accident because he was not carrying any passengers.
But the family sued Uber anyway, for wrongful death and negligence. The lawsuit states that the Uber driver was logged into the Uber network when the child was struck, and therefore the company is responsible for the accident.
These ride-sharing firms, also known as “transportation network companies” got approval in September 2013. These companies connect people who need rides with drivers — who use their own personal vehicles — through smartphone apps. Though there is a price for the ride, just like with taxis, the cost is often a third cheaper than taxi fares.
Rules enforced by the California Public Utilities Commission state that the companies must provide $1 million worth of liability insurance when a privately owned car is being used to carry passengers for a fee.
The problem is deciding exactly when these drivers’ cars are and are not covered by the policy. This is what could be settled in court.
The California state Department of Insurance has called in the Public Utilities Commission (PUC) due to the uncertainty of safety for passengers, pedestrians, and drivers.
This lawsuit could be the first of many to come unless the PUC puts a definition on exactly when a driver is providing ride-sharing services and is therefore covered by the insurance policy.
According to the article, the ride-sharing companies are required to provide coverage only when their drivers are at fault for damages to people or property.
The policy does not cover injury to the driver or damage to their vehicle — that is up to their own insurance coverage, if they have any. Passengers of the ride-sharing companies also do not receive coverage if another vehicle, whose insurance does not cover injuries, injure them.
Ride-sharing companies must patch up the holes in their insurance coverage if they are to be trusted. Always be aware of insurance policies and coverage when you are getting in to a car with a transportation company or carpool group.