Insurance for Uber Drivers

If you are in an Uber car and there is an accident, who is responsible?
If you are getting a ride from Uber and there is an accident, who is responsible?

On New Year’s Eve, 2013, a mother and her two children ages five and six were struck by a sport utility vehicle that failed to yield to them in a San Francisco crosswalk. The six year old child was killed and her mother survived, but underwent eye surgery and required several weeks of hospitalization.

The driver was driving for Uber on the night of the accident, but did not have a passenger with him at the time; he was “between rides”, but was logged into the Uber App.

The family filed a lawsuit against Uber arguing the company was responsible for the driver’s conduct and, furthermore that Uber failed to provide insurance that would have covered the driver and the harm he caused.

According to Uber, the driver was a contractor, not an employee.  The company deactivated his contract after the accident (the driver was charged with misdemeanor vehicular manslaughter).

Uber settled the lawsuit under undisclosed terms.

But it raises an interesting point.

Under Virginia law, taxicab drivers are regulated and are required to have a minimum amount of insurance, usually $100,000 per person.

What about Uber drivers? Are they individuals simply using Uber (or Lyft, etc.) to be connected with others needing a ride?  Or are they employees of the company that takes a share of each ride’s fare? Surely you could argue they are driving on behalf of Uber.

Who bears responsibility for ensuring they have appropriate insurance? Does their personal auto insurance cover them while driving for hire? Do they need commercial insurance like taxi drivers? And who verifies they have appropriate coverage?

Companies like Uber and Lyft have ventured into new territory, and rules and regulations are evolving. It is not uncommon for litigation to drive an industry’s evolution. We will be watching this. If you or someone you know has been injured while in a car driven for hire and there are questions as to what laws apply, email or call Abrams Landau, Ltd. at once (703-796-9555).