Rideshare companies such as Uber and Lyft have completely disrupted the transportation industry with their convenient apps, competitive rates, and efficient service. They have also created a lot of action in the courts over insurance coverage and background check issues. Before you, "Uber" yourself to your friend's party or to the airport, know that these companies, at least for now, are less regulated than the taxi industry.
Background checks. A third-party, Check, screens prospective Uber drivers using their social security numbers, driver's licenses, proof of insurance, and vehicle registrations. In January 2016, Uber decided not to reject applicants with certain non-violent or non-sexual offense records, such as for petty theft and check fraud.
This is an interesting move considering the scrutiny surrounding Uber's background checks. The company recently agreed to pay a settlement of up to $25 million in a California lawsuit for misrepresenting the quality of its background checks.
In the suit, California regulators said they found evidence that Uber failed to weed out 25 drivers with criminal records, including those with kidnapping and murder convictions.
By contrast, many taxi companies use LiveScan, a service that includes fingerprint checks and continual criminal status monitoring.
Insurance coverage. Collisions that involve Uber drivers raise complicated and serious insurance coverage issues. In California, Uber requires its drivers to carry a personal auto insurance policy. That policy usually does not cover the driver when they work for Uber.
Uber's policy claims to fill in the gap. It holds a commercial insurance policy with $1 million in liability coverage per incident. This kicks in when the driver accepts a trip request through the Uber app and stays in effect through the life of the trip.
As of July 2015, California requires Uber and other rideshare companies to maintain $200,000 of excess liability coverage that goes into effect from the time a driver turns on the rideshare app to the time they close it. This way, if the driver is roaming around waiting for a job and gets into an accident, the rideshare company cannot deny liability.
Uber tried this in the past in the case of six-year-old Sofia Liu, who was hit, along with her mother and brother, while crossing a crosswalk in San Francisco. Young Liu died from her injuries. The family's wrongful death suit, which they recently settled with Uber for an undisclosed sum, spawned legislation that led to the $200,000 policy requirements.
Liu's case wasn't the first time Uber denied liability. So don't count on that $1 million to be available without a fight.
If you're involved in an accident with an Uber driver, take the same precautions as you would with any auto accident:
• Get names and contact information of everyone involved and all witnesses.
• Take multiple photos of the accident scene and cars involved.
• Call the police.
• Call a personal injury lawyer as soon as possible.
Rideshare companies are relatively new, which means the courts are still trying to determine various legal liability issues. If you've been injured in an accident that involves an Uber driver, call a personal injury attorney who knows how to navigate this new territory.
(Photo courtesy of Jason Tester, Flickr)