Involved in an accident while using Uber or Lyft? Or driving for Lyft/Uber and injured in an accident? Read below for the most comprehensive guide to Uber and Lyft Accidents in California.
Uber and Lyft are transportation network companies (TNC) that connect passengers with independent drivers. Also known as peer to peer ridesharing, the services have become extremely popular in recent years. Uber was the first major company to introduce a mobile phone app to arrange rides, but competitors followed shortly, with Lyft being the closest competitor. After a few years of legal disputes between cities, taxi cab companies/associations, and the TNC's the California Public Utilities Commission (CPUC) legitimized the companies by establishing the TNC category. TNC's are required to to get a license from the CPUC, have criminal background checks of all drivers, have a driver training program, have a zero-tolerance policy on drugs and alcohol, have a minimum of $1 million per incident insurance coverage.
The CPUC decided that the TNC's were not like taxis, because the rides were pre-arranged instead of allowing the drivers to pick up hailing passengers. This is an important distinction for passengers and drivers as we'll discuss later in the guide.
This all means the TNC's are here to stay, at least in California. Consumer usage of these services are booming, and many car accidents now involve a TNC vehicle in some way.
Beginning July 1, 2015 there are 3 periods where TNC insurance policies kick in:
You can find all of the licensed companies and their insurance certificates here.
If you were in another car, and the TNC driver caused an accident in which you were hurt, then the case is almost like a normal car accident with a few things to watch out for.
You need to know whether the driver's app has been turned on, whether they had accepted a ride and/or were carrying passengers. If the driver did not turn on their TNC app yet, then their personal insurance policy should be in effect. If they had the app turned on, but had not yet accepted a passenger, their personal policy may be in effect, or the TNC's contingent coverage (Period #1 above) will spring into action with its $50,000/100,000 coverage for death or bodily injury.
Keep in mind, if you maintain uninsured or underinsured motorist coverage (UM/UIM) higher than these amounts, you can make a claim against your own policy once the TNC limits are exhausted.
Once the driver accepts a ride, the $1 million policy kicks in, even if they haven't picked up the passengers yet.
WARNING: See the hailing section below.
If your driver causes an accident, you will have a claim against your driver, and the $1 million minimum policy limits are in effect, since you are a passenger that has been picked up (unless you hailed the driver, which you should never do - see the discussion below).
If you carry UM/UIM coverage above and beyond the TNC's limits, you can tap into that policy if the TNC limit is reached.
Read further: Is Uber or Lyft responsible for my injuries?
Generally, the person who caused the accident will be responsible for your injuries. So whatever coverage they carry will be in effect. If you are not working yet and haven't turned on your app, your personal auto policy should be in effect. If you are in Period 1, where you have turned on the app but haven't yet accepted a ride, your personal policy may or may not be in effect anymore.
The TNCs are not required to carry uninsured/underinsured motorist coverage for this time period. This may be a problem if your injuries are significant and the at-fault driver has a minimal policy or worse, is uninsured.
If you are driving for Uber, Lyft or one of the other TNCs, have turned on the app but have not yet accepted a ride, you may be in a vulnerable situation where your personal policy is no longer in effect because you are now "conducting business activities." Yet your big main policy from the TNC is not yet in effect because you haven't accepted a ride yet.
You can see Lyft's explanation of their insurance policy. Their uninsured/underinsured coverage only kicks in once you accepted a match and continues through the ride until you drop off the passengers. This is a huge gap in coverage and leaves drivers exposed and vulnerable.
WARNING: Unless you purchase optional coverage, find a safe spot to park your car before turning on your app. If you need to move, turn the app back off. Do not drive while the app is turned on and you have not yet accepted a match.
Metromile, a niche insurance company, offers a unique niche insurance product for Uber drivers. They inked an exclusive deal with Uber, so you can't use them for Lyft or Sidecar, or any other TNC. They charge per mile (great for tracking mileage). Read more about it here.
As of May 28, 2015 Farmers Insurance is offering an option for its customers to purchase coverage that will last from personal driving, and up through Period 1. Period 1 discussed above is when a driver turns on the app but hasn't yet accepted a match. This is when normal policies are no longer in effect, but the TNC's larger policy is also not yet in effect, and only the small contingent $50,000/100,000 policy with no UM/UIM coverage is available.
According to Farmers, this option will only cost 8% more than normal coverage. I always recommend everyone purchase as much coverage as possible, and to never decline UM/UIM coverage. That coverage is just for you and your family so don't skimp on it and never decline it.
Hopefully more companies will follow soon.
This is the tricky part. What happens when a TNC driver accepts an illegal passenger who did not use the app to prearrange a ride? At the beginning of this article I discussed the CPUC's decision to classify TNC's as different from taxi cabs because TNC's accept prearranged passengers similar to charter party carriers under Public Utilities Code §5360.5.
If a TNC driver illegally accepts a passenger who hailed them, does this nullify the company's insurance policy? Since they were conducting business, it is reasonable to assume the personal policy will not be available, even if you purchased the optional premium coverage offered by Farmers Insurance.
But the question remains: Will the TNC's insurer deny coverage the driver illegally accepted a passenger that hailed the driver?
Insurance companies are always looking to deny coverage. That's just what they do. If they can find a reason to do so, they're likely to do so.
The other driver's insurance will cover you, and if that is enough, it is possible your own personal policy will cover you if you carry sufficient UM/UIM coverage. You may not have access to your driver's large, $1 million policy.
Be careful. You might not have coverage from your personal policy, or your TNC's policy. This can be a problem even if someone else hits you. In California, Proposition 213 (codified as Civil Code Section 3333.4) limits your recovery in car accident cases if you do not carry valid insurance.
If you are injured by someone else in a car accident, and do not carry valid insurance coverage the exact moment you are injured, you can only recover medical expenses (and other actual costs). You cannot recover any money for pain, suffering, inconvenience, disability, loss of enjoyment of life, or any other non-economic damage. This significantly limits your recovery if you are severely injured.
If you are a driver for a TNC, it is best to review the actual policy to see if coverage can be excluded here. It'll be interesting to see when this inevitably happens.
The Law Office of Joseph Dang can help you through the confusion and legal mess that follows a serious car accident involving Uber, Lyft or other TNC's here in California. If you have any questions do not hesitate to give us a call or fill out a form.