Uber and Lyft ProtectionThis is the last of a four-part series on Uber and Lyft Protection.  In Part 1, I tried to explain the law. In Part 2, I discussed the law relative to passengers. In Part 3, I analyzed the law related to other drivers on the road. In this last part, I’m going to talk about the law and how it affects Uber or Lyft drivers currently and those that are thinking about becoming drivers.

Under the law, Uber or Lyft must provide coverage for drivers if, they fall into one of three stages (periods) of coverages. Please see Part 1 for a refresher of the different stages. If anyone of these stages apply, the Uber or Lyft driver’s personal auto insurance will NOT apply. Uber or Lyft must tell drivers in writing about this and it is important for drivers to know this as I shall explain later.  It also must disclose in writing to its drivers its own insurance limits and coverage. Proof of Uber or Lyft’s insurance coverage must be carried with the driver at all times while using the vehicle with the app on. If an accident occurs, this proof of insurance must be furnished upon request by the other party or police officer.

If the app is turned on and a driver has not accepted a ride yet, the law requires that Uber or Lyft carries auto liability coverage of $50,000.00 per person, $100,000.00 per incident, and $30,000.00 property damage. It also must carry excess $200,000.00 liability coverage.

Once Stage Two or Three kicks in (driver accepts a ride or picks up a rider) the liability coverage gets bumped up to $1,000,000 total. The is the same for uninsured or underinsured motorist coverage requirement.

A driver of course may purchase more coverage if he or she wants to. It is called ride sharing insurance.   Why should a driver do this? So, now we are getting to the fun part.

Recall when I said that once your app is turned on, your own personal auto insurance DOES NOT apply. This means your personal uninsured or underinsured, comprehensive, collision, medical or rental coverage that you purchased doesn’t apply. Let’s go through each coverage to see how it affects you as an Uber or Lyft driver when you get in a car accident.

For collision coverage, this covers your property damage regardless of whether you are at fault or not. If you bought this for your personal auto insurance coverage, and you get into an accident while your app is turned on, it does not apply! This is very significant if the accident is your fault! This means that you must now pay out of pocket for the damages to your vehicle only (Uber or Lyft covers damages to the other party’s vehicle up to the respective stage limits). If the other driver is at-fault and assuming he has the minimum required insurance coverage for property damage of $5,000.00, then that’s the maximum his insurance will pay out. The problem now is what if your car was worth more than $5,000.00? Well, if your own insurance still applied and you had purchase collision coverage, it would kick in and you just pay your deductible at most. But the law now has specifically excluded your own personal auto insurance but has left a gap because it doesn’t require Uber or Lyft to pay for any collision coverage. It is incomplete and leaves you as an Uber or Lyft driver, without sufficient coverage unless you purchase it under your ride sharing insurance.

For uninsured or underinsured coverage, it’s the same thing for Stage One only. Remember, the law requires Uber or Lyft to provide this coverage in Stage Two or Three. So again, while you are driving around waiting and you have not accepted a passenger, you are not covered under your own insurance or this new law because it doesn’t mandate that Uber or Lyft provide uninsured or underinsured motorist coverage at this stage.

For comprehensive, rental or medical payments, it is the same gap as collision coverage.   If you purchased it for your personal auto insurance, and if one of three stages apply, it takes away all your coverages while leaving you with incomplete coverage. The law does not require that Uber or Lyft provide you with any comprehensive, collision, rental or medical payments coverage. You now have to buy extra insurance, so that you will be covered where the law has taken away your personal insurance and made Uber or Lyft provide you with incomplete coverage. Way to go.

One tip for Uber and Lyft drivers: turn your app on and park and wait until you accept a ride before you begin driving. At least then you will be in Stage Two or Three, with $1,000,000.00 in liability and uninsured/underinsured motorist coverage. But, this is in no way complete coverage. For all other coverages, you must purchase additional insurance to cover you, even if you already have it personally. Way to pass the buck!