Ridesharing services such as Uber and Lyft offer people an affordable means of transportation through the use of an app. If this sounds a lot like using your smartphone to hail a cab, you’re not far off. So far, these huge companies have been able to operate largely free from the legal constraints under which traditional taxi services operate. This means lower costs for riders but uncertainty for consumers and even bystanders, especially when a rideshare vehicle is found liable for an accident. At the Schuler Law Office, we understand the gray areas of the law as it applies to rideshares. If you’ve been injured in a rideshare accident, we can help you recover the full compensation you deserve.
In the United States, ridesharing companies have enjoyed “hyper-growth” in recent years, as employment in this sector has risen nearly 70 percent from 2010 to 2014. The ease of use and low costs of a rideshare versus a traditional taxi have fueled global growth, producing a $68 billion valuation for Uber, making the company bigger than General Motors, Ford, and Honda. Uber also continues to grow its robotics fleet, so residents of Louisville may soon be able to ride in the back of a self-driving vehicle.
But the rapid growth of rideshare services inevitably means an increase in rideshare-involved traffic accidents. What happens when an Uber or Lyft vehicle causes an auto accident that injures you?
When a taxi driver causes an accident, the taxi company is on the hook. The ancient legal principle of respondeat superior, which required the master to answer for the carelessness of his servant, still applies today to employers and employees in the performance of their duties. Taxicabs must carry liability insurance in the following amounts:
When rideshare businesses began, the companies claimed that drivers were independent contractors, so the company was not liable for driver negligence. However, after a couple of high-profile catastrophic accidents, Uber was forced to revise its approach to insurance. Likewise, states and municipalities started passing regulations aimed at protecting the public. In fact, Kentucky passed rideshare rules in December 2014, before any rideshare company had even applied to do business in the commonwealth.
Today, Kentucky requires rideshare services to supply $1 million in liability insurance to each driver while ferrying passengers. Drivers must have the statutory minimum level of liability insurance at all other times. This is another substantial difference in the way the law treats rideshare cars and taxis. A taxi is always a taxi, but a vehicle is only an Uber or Lyft car when it is carrying a passenger, not while going to pick up a passenger or immediately after dropping one off.
However, Uber and Lyft’s insurance coverages go beyond the Kentucky requirement. The companies cover drivers with $50,000 in personal injury liability for one person, $100,000 for all persons, and $25,000 in property damage protection, when the driver has the app turned on and is available to receive requests. On the way to pick up a fare and while transporting a fare, the driver has $1 million in liability coverage. While driving a car for their own use, Uber and Lyft drivers must rely on their own insurance policies.
The Schuler Law Office provides highly effective representation for auto accident cases throughout Kentucky and Indiana, including cases involving rideshare vehicles. Throughout the legal process, we work diligently to produce the best results possible. To arrange a free consultation at our Louisville office, contact us online or call us at 502-568-9000.