Ride share services have been making headlines lately. These ride services are giving traditional taxi services some major competition. Ride share services allow customers to request a ride at any time of the day via smartphone. This is easy and convenient for the customer. However, there are some concerns with these services; one concern involves liability when a passenger is injured when using these services. One debate concerns whether ride share drivers are employees or independent contractors; this distinction is very important when determining liability in the event of an accident or injury to a passenger. 

Driver Insurance Coverage

Each driver who accepts driving assignments for a ride share service is required to have an automobile insurance policy on their own vehicle. Some insurance companies have an exclusion in auto insurance policies that prohibits a payout if the automobile is involved in an accident while being used for work purposes, such as pizza delivery or ride-for-hire. If there is such an exclusion on the driver's personal auto insurance policy, they will be required to obtain a commercial auto insurance policy to cover personal injury and property damage while performing services for a ride share service. Since drivers have been determined by the courts in several states to be employees and not independent contractors, these ride share services do require proof of insurance for all of their drivers. However, drivers' policies are not scrutinized in detail to ensure that there is no clause prohibiting coverage if the automobile is engaged in work pursuits at the time of an accident. It is the driver's responsibility to obtain proper coverage on their vehicle. It is also the driver's responsibility to have the proper operator's license for their vehicle; if a commercial driver's license is required, a driver's auto insurance policy may not pay out if a passenger is injured and the driver is not properly licensed.

Corporate Insurance Coverage

It is not widely advertised, however, that ride share services do have additional coverage on each of their drivers, even in states that deem ride share drivers to be independent contractors. This policy includes $1 million of liability coverage, and $1 million of uninsured/under-insured motorist coverage per incident. This insurance coverage takes effect when a driver accepts a ride assignment, and ends upon completion of the ride. In addition, drivers are covered between ride assignments. This coverage includes $50,000 of coverage for bodily injury to the driver, with up to $100,000 of coverage for injuries per accident, as well as $25,000 of coverage for property damage. 

For more information about ride service insurance and what to do in the event of a ride share accident, talk to a personal injury lawyer like Bennett & Zydron PC.

Share