There’s been a rise with Rideshare companies out in the market today. When they first came to light it was difficult for insurance companies to offer insurance coverages. But since these companies are on the rise and auto insurance companies are aware, we are now starting to see that Rideshare insurance coverage it’s not available. Although with that being said having the ability to complete auto insurance coverages is still unavailable the majority of the Rideshare drivers.
So to put this in perspective you want to give you a little bit of an example of how this can be a disastrous event.
So you’re on a call with Uber driving around waiting for a passenger to connect with you. Fortunately, somebody is needing a ride in your right by them so you take a quick U-turn and you go about your way to make sure that you pick up this customer. So while on Route you look over at your phone quickly just to find out how far away you are from the customer, all of a sudden boom. You hit the car in front of you. For conversation’s sake let’s say that the accident wasn’t that bad oh, but it was bad enough that the other driver wanted to call the cops for the scene of the accident. And due to the fact that you were in an accident, you have to cancel your Pick up.
Now we’re at the scene where the police come to take on all the information on the events that unfolded at the scene of the accident. They knocked down that you were driving for a company known as Uber. So you go about your way and you submit your claim to your auto insurance company. That you may think business will be as usual your insurance company will cover the damages and everything will be okay.
Pictures where there is a huge misconception. Your insurance company calls you and tells you your claim has been denied simply because you were performing a business activity. And since you are performing a business activity with personal insurance is a huge No-No. Not only are you on the hook to make sure that you pay for the damages on your car but also the other person’s car you hit. And just to add to the burn your auto insurance company cancelled your coverage. So now not only do you have a lapse in coverage, but you also have to Fork out the money to pay for the excessive bills on your insurance claim.
The only other hope is to reach out to Uber and see if their insurance policies going to cover any of the damages.
So another major concern it is the fact that you can hail a taxi from your smartphone with work. Are the competitors in the market such as Lyft and Sidecar? We’ll have a ton of vehicles star license for black car services, it has a product called Uber X where you can fly down a car driven by some random guy.
So unlike traditional Black Card Services will you have to go through a series of checks to make sure that you’re eligible to perform such an action? Anyone can drive for Uber X. In order to qualify all you need is if you pull that qualifies and also the Uber app. this raises many flags especially for workers’ rights and any safety issues that could happen. So where does one draw the line?
David Fagin working for Huffington Post went undercover as an Uber driver says “[Uber will] pretty much take anyone, as is demonstrated by the downloadable video test you have to pass, which is about as hard to master as tying your shoes. From there, as far as I can tell there’s no license check; you simply get your vehicle’s paperwork and head to a nearby Holiday Inn.”
There are massive debates with the rise of these new companies. Uber, Lyft, and even Sidecar are the heart of a debate between the government Regulators as well as the companies in question. The California Public Utilities Commission has decided to create a new category of transportation services for these companies which they are now known as Transportation Network companies also known as TNC.
These three Rideshare companies Uber Lyft and Sidecar refer to categorize himself as technology companies. Hear something Uber wrote in a legal filing with the CPUC.
Uber operates no vehicles and does not hold itself out or advertise itself as a transportation service provider. In fact and law, Uber does not provide transportation services of any kind and does not own, lease or charter any vehicles for the transportation of passengers. On the contrary, Uber is a technology company that licenses the Uber App to transportation service providers. The transportation service providers pay a fee to Uber to use its software technology; the passenger of the transportation service provider pays the transportation service provider for transportation services received.
Now that we have a little bit of a backstory of all the confusion and government regulations that are combating these rideshare services. Let’s give you the little Insurance secret that Uber, Lyft, and sidecar don’t want you to know.
The reason we have such a big backstory it so you can understand all the ins and outs about what would happen to a driver if they were to ever get into an accident. Now let’s give this a quick thought, if these companies are facilitating any relationship between a third-party driver and a potential user under the category of a technology company, it goes without saying that these companies won’t be liable for much of anything.
And due to that reason above, the risks of insurance claims are solely based on the driver who is providing the Rideshare services. And quite frankly many drivers may be unaware of the fact that their personal insurance coverage may not cover them if they’re using Rideshare services.
So if you’re driving for a Rideshare company and you only have personal insurance coverage your auto insurance company typically won’t cover you in an accident if it were to happen. We have heard that some drivers attempted to file a claim with their insurance company and they have been rejected, even though the insurance company knew they were performing Rideshare services.
To add to this some auto insurance companies go ahead and cancel your auto insurance coverage simply due to the fact that you perform Rideshare services.
When you visit the Rideshare company site they usually do provide you with some insurance coverage options. But one that sticks out is when a driver is available but not on a trip meaning they don’t have a passenger in the car. This has become a floor of debate for any TNC, regulator, and drivers.
I know we could have scared you especially if you’re a driver for one of these Rideshare companies. Before you make any rash decision, take the time to read below and make sure that you can do these things to ensure that you’re covered.
So depending on whether or not you’re looking to be a Rideshare driver full-time or part-time this is subjective to whether or not you’d prefer to buy commercial Auto Insurance. So if you’re a full-time driver definitely consider the commercial auto insurance option. Although if you’re a part-time driver, we advise you contact your auto insurance company I find out how they deal with any insurance claims by any Rideshare company.
Don’t get me wrong, driving to these companies is a great opportunity for anyone. Provides you and your family a great source of income in a sense of security. Not only that you make new friends all along the way. But first things first, don’t leave yourself open to any risks. Make sure that you have a strong Foundation financially for you and your family.