The Insurance Secret Uber Doesn’t Want You to Know

Uber Accident Attorney Reveals All

Who, precisely, is liable when a driver is involved in an accident? Is it them, their insurance company, or the company they work for? The law isn’t clear on this question as liability is determined on a case by case basis. However, it is this legal gray area that many companies, particularly those involved in the tech industry, take advantage of to avoid liability. For example, suppose a company such as Uber facilitates the relationship between a client and a third-party driver. In that case, it can simply claim that it is not liable in case the third-party driver is involved in an accident. However, there is more to this than meets the eye.

In the Uber model, most of the insurance load is left on the shoulders of Uber drivers, who are actually using their own personal car insurance (PCI). These drivers might not be aware that their PCI policy might not cover them if they work for Uber or other ride-sharing applications. If you have a PCI policy, it is important to know that the insurers will not cover an accident while you are carrying out any commercial activities. Many insurance companies have made it clear that their PCI policies will not cover any cars used in the transportation of passengers for a price. There have been various reports of certain insurance companies, such as Geico withdrawing PCI policies or declining to renew them due to a driver’s Uber activity. KQED recently reported that numerous drivers in California have been denied insurance after disclosing their plans to work for ride-sharing companies. Thus, it is important for you to know that you will likely not be covered by your PCI in case of an accident.

However, in 2014, Uber posted an infographic on their site which shows when a PCI cover concludes and when their insurance kicks in. According to Uber, when the Uber app is not in operation, the driver is covered by his or her own PCI, but when the Uber app is in operation and there is a passenger in the car, the driver is covered by Uber’s insurance. Who is liable if something happens when the car has no passenger, but the app is on, is subject to heated debate among ride-sharing companies, drivers, and regulators.

This particular insurance gap got a lot of media scrutiny in 2013 when an UberX driver struck and killed a six-year-old girl, Sofia Liu. Some of her other family members were also severely injured in the accident. A wrongful death lawsuit was filed against the Uber driver by an Uber accident attorney representing Liu’s family. However, Uber refused to admit liability for the damages since the Uber driver was not carrying any passenger at the time the accident occurred. The CPUC (California Public Utilities Commission) re-evaluated its insurance requirements for transportation networking companies (TNCs) in response to this particular occurrence. Assembly Bill No. 2293, which was later signed into law and became effective on the 1st of July 2015, requires California car insurance companies to have insurance covers for various commercial activities, including ride-sharing.

Hopefully, car insurance companies in other states will be encouraged by the new regulations of California to come up with separate commercial insurance policies for ride-sharing drivers. However, questions still remain regarding how these policies will actually work.

If you have ever been involved in a car accident involving an Uber driver, you should seek the services of a proficient Uber accident attorney. You are legally entitled to compensation for your accident-related damages.

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