Like most people today, you’ve likely found yourself in need of a ride and turned to your Uber or Lyft app in order to get the cheapest, quickest driver to take you where you need to go. Or, you may be reading this right now as a driver for one of these rideshare apps. Either way, there are things you need to know should you find yourself involved in an accident as a driver or a passenger.
What Drivers Need to Know
Uber and Lyft both provide supplemental insurance policies for their drivers. What that means is, in addition to the personal car insurance you have, Lyft and Uber have additional policies that will provide extra coverage if you’re involved in an accident.
The most important thing a driver should realize, however, is that while both Lyft and Uber require you to have personal insurance policies before qualifying you as a driver, your personal auto insurance policy you do have likely will not cover you if you’re involved in an accident while performing your duties as a rideshare driver.
So, before you log on and grab that first ride, make sure you call your insurance company, inform them you’re becoming (or are currently) a driver for Lyft or Uber, and find out exactly what coverage they offer. Be aware, though, your insurance company will likely force you to pay a higher premium for a policy that will cover you while you’re driving for Uber or Lyft.
Just because you have car insurance, doesn’t mean you’ll automatically be covered in any situation. And, the supplemental insurance Lyft and Uber provide will likely not come close to covering all your liabilities if you’re in an accident while driving for either company. Even after you’ve turned the app on and are looking to pick up passengers, if you haven’t picked up a passenger yet, you won’t be covered under any Lyft or Uber insurance policies. And if you haven’t called your personal insurance company to inform them of your employment as a rideshare driver, they will likely deny your claim, too.
For these reasons, it’s imperative you talk to your insurance company before accepting a job as a rideshare driver.
What Passengers Need to Know
If you’re a passenger who often relies on Uber or Lyft, you should familiarize yourself with insurance, too. Uber and Lyft have insurance policies that will pay the medical expenses or lost income of passengers who are injured in accidents while the driver is using their app. However, those policies will only go into effect after the rideshare driver’s insurance has been exhausted.
The dual insurance situation can make it a long and arduous process. In most cases, there will be insurance coverage, but it can take a long time to receive compensation.
Don’t Forget About State Laws
Some states have “no fault” laws in effect, which means that, in an accident, each driver’s insurance covers their own expenses. If the driver who is not at fault does not receive enough coverage through their own policy or if other conditions are met, they have the right to sue the driver who was at fault. However, the no-fault laws can make accidents claims involving rideshare companies even more complicated.