Uber, Lyft, and other “TNCs”: How Much Insurance Coverage Do Rideshares Provide? | Allen and Allen

Uber, Lyft, and other “TNCs”: How Much Insurance Coverage Do Rideshares Provide?

Transportation Network Companies (TNCs) such as Uber and Lyft have become prominent in Richmond since 2015.  Worldwide, Uber has expanded into 83 countries and over 674 cities, while Lyft serves more than 300 US cities in all 50 states. The enormous growth in TNCs means that people have more options and flexibility when it comes to transportation. It also means that issues can arise that have not previously been considered. Many people wonder how they will be compensated if injured in or by a TNC. The answer depends on three things: (1) Is the Driver running the application, (2) Is the driver traveling to or from a fare, and (3) Is there a passenger in the vehicle?

HOW IT WORKS:

Once a driver accepts a ride, and until that ride is complete, the TNC Broker (i.e. Uber or Lyft, etc.) must provide both liability and underinsured (UIM) motorist coverage up to one million dollars.  This means, if you are injured while riding in a TNC vehicle, and on an arranged ride, you are protected up to $1 million no matter if the TNC driver or another vehicle is at fault for the collision.

If the TNC driver is running the application, but has not yet picked up a passenger, then the TNC Broker must only provide $50,000 per person in both liability and UIM coverage.  This means, if a TNC driver who does not have a passenger hits you, you are only protected up to $50,000.00 in coverage.  Initially, the TNC Broker was required to provide coverage up to $125,000 per person; however, the General Assembly changed this for all TNC Brokers after January 1, 2016. Here are how some hypothetical situations will play out if you are injured while not riding in a TNC.

HYPOTHETICAL 1:

You are walking down Patterson Avenue.  You get to the intersection, and hit the button, which enables you to cross.  When the signal allows, you check to make sure the way is clear before you begin to walk to the other side well within the cross walk.  An Uber driver carrying two people on their way to Scotts Addition hits you.  You suffer extensive injuries including several broken bones, severe bruising, and a concussion, which require surgery and a stay in the hospital.

QUESTION: How much coverage will the Uber Driver’s parent company provide for you?

ANSWER: $1,000,000.00

HYPOTHETICAL 2:

Consider all the same factors in the first hypothetical, except, this time, instead of getting hit by an Uber driver with passengers, you get hit by an Uber driver on his or her way to pick up passengers.

QUESTION: How much coverage will the Uber Driver’s parent company provide for you?

ANSWER: $50,000.00.

HYPOTHETICAL 3:

Consider all the same factors in the first hypothetical, except, this time, instead of getting hit by an Uber driver with passengers, you get hit by an Uber driver on his or her way to deliver food using UberEats.

QUESTION: How much coverage will the Uber Driver’s parent company provide for you?

ANSWER: $50,000.00.

HYPOTHETICAL 4:

Consider all the same factors in the first hypothetical, except, this time, instead of getting hit by an Uber driver with passengers, you get hit by an Uber driver who is not on duty.

QUESTION: How much coverage will the Uber Driver’s parent company provide for you?

ANSWER:  None.  Instead you will need to look to the driver’s personal policy, and any UIM coverage you may have on your own policies.

COLLECTING DAMAGES FROM TNCS:

Recovery by the company’s insurance provider is likely the best option for receiving compensation if you were injured in or by a TNC. If you were injured while riding in a TNC, you are protected up to $1 million no matter who is at fault for the collision. If you were injured by a TNC while crossing an intersection, the amount of compensation can range based on whether or not the driver is carrying passengers, picking up passengers, or is actively using the app.

If you have suffered an injury while using a ridesharing program, contact Allen & Allen for a free consultation.


See Avery Hartmans and Nathan McAlone, Business Insider, The Story of How Travis Kalanick Built Uber Into the Most Feared and Valuable Startup in the World (Aug. 1, 2016) available at https://www.businessinsider.com/ubers-history.

See Va Code §46.2-2099.52.

See id.

See Va Code §46.2-2099.51