Who Shares the Risk When You Rideshare?

By Catherine Powell

Image courtesy Pixabay

I'm old enough that I remember when the only rideshare option available to most commuters was a carpool.  Back then carpooling was seen as a great way to save money on transportation while doing your part for the environment at the same time.  But since 2009, when Uber was started, ridesharing has become a big business, not to mention a way to turn your personal vehicle into a taxi.  While I covered the insurance ramifications of carsharing in a previous blog, now that everything from bicycles and scooters to electric vehicles are available as rideshares, I thought it was time to give my readers the lowdown on who's covered should an accident occur.  

Do Uber & Lyft cover passengers who get hurt while using their service?

Both companies cover driver, passengers and third parties such as pedestrians should they be injured or killed by one of their drivers with up to $1 million in combined injury and property loss protection.  However, this coverage only applies as long as the driver has logged onto the app and is ready to accept fares.  Both Uber & Lyft even cover third-parties who are injured when one of their drivers is looking for a fare.  Should one of their drivers hit a pedestrian or another car when no fare is present, both rideshare companies will pay up to $25,000 in property damage and up to $50,000 in compensation for injuries sustained by a third-party provided the driver is logged in.  Meanwhile, the driver responsible for the accident will have to cover any damage to their vehicle or themselves out of their own pocket unless otherwise covered by the driver's auto insurance policy.

It Isn't Easy Going Green

I don't know if you've noticed it, but the past few years have seen a proliferation of eco-friendly transportation (and I don't just mean electric cars.)   Recently I've seen electric scooters, electric bicycles, and even electric skateboards zip through my neighborhood or pass me at a traffic light.  Not only have consumers started snapping up alternate means of transportation, so too have businesses that offer many of these vehicles for ridesharing. Before you hop on the eco-friendly rideshare bandwagon, bear in mind that there are inherent dangers associated with every form of transportation.  Case in point:

A company called Revel ran into a problem back in 2020 when its fleet of 3,000 electric scooters came under scrutiny in New York City after two of them were involved in fatal accidents.  A New York Daily News article reported that, "those who wanted to rent one of the electric Vespa-style scooters — which ride in regular traffic like motorcycles — needed only download the app and enter their driver’s license information. No special license is required for a moped like this in New York State, and the company offers but doesn’t require a safety class." 

The article also pointed out that in 60% of serious or fatal accidents involving Revel's equipment, the riders weren't wearing helmets, even though the company implored their customers to wear them.  Since Revel's e-mopeds can reach a speed of 30 MPH, these publicized accidents resulted in the company pulling its fleet off the street for a time.  What the article didn't mention was who paid for any injuries or fatalities that occurred as a result. However, if you go to the company's website, you'll find the Revel Moped Rental Agreement.  Under the section labeled Important Bullet Points, you'll discover the following:

• THIS AGREEMENT CONTAINS A MANDATORY ARBITRATION PROVISION THAT, AS FURTHER SET FORTH IN SECTION 11.0 BELOW (AND SUBJECT TO THE EXCEPTIONS SET FORTH THEREIN), REQUIRES THE USE OF ARBITRATION ON AN INDIVIDUAL BASIS TO RESOLVE CERTAIN DISPUTES, RATHER THAN JURY TRIALS OR ANY OTHER COURT PROCEEDINGS, OR CLASS ACTIONS OF ANY KIND.
• THIS AGREEMENT CONTAINS RELEASES, WAIVERS, DISCLAIMERS, AND ASSUMPTION-OF-RISK PROVISIONS, THAT LIMIT YOUR LEGAL RIGHTS AND REMEDIES, INCLUDING BY WAIVING CLAIMS OF NEGLIGENCE AGAINST REVEL. FURTHER DETAILS CAN BE FOUND IN SECTIONS 6.0, 7.0, 11.0, and 12.0.
• RIDING A MOPED IS A HIGH-RISK ACTIVITY. DEATH OR SERIOUS INJURY IS POSSIBLE. MUCH LIKE OTHER RENTAL SERVICES, REVEL DOES NOT PROVIDE HEALTH INSURANCE COVERAGE.
• MEMBER ASSUMES FULL AND COMPLETE RESPONSIBILITY AND LIABILITY FOR THEMSELVES AND FOR ANY PASSENGER, FOR ALL RELATED RISKS, DANGERS, AND HAZARDS.  FOR THE AVOIDANCE OF DOUBT, MEMBER IS SOLELY RESPONSIBLE FOR ANY DAMAGE OR INJURY TO HIS OR HER PASSENGER.
• BEFORE EACH USE OF A MOPED, MEMBER SHALL CONDUCT A SAFETY INSPECTION OF THE MOPED PURSUANT TO THE RULES. MEMBER AGREES NOT TO RIDE IF THERE ARE ANY NOTICEABLE ISSUES AND TO IMMEDIATELY NOTIFY REVEL OF ANY PROBLEMS.
• REVEL PROVIDES LIABILITY COVERAGE FOR DAMAGE DURING A MEMBER’S USE OF MOPEDS. FURTHER DETAILS CAN BE FOUND IN SECTIONS 4.0 AND 5.0, BELOW.
• YOUR PERSONAL INSURANCE POLICIES MAY NOT PROVIDE COVERAGE FOR CLAIMS INVOLVING THE USE OF A MOPED. TO DETERMINE IF COVERAGE IS PROVIDED, YOU SHOULD CONTACT YOUR INSURANCE COMPANY OR AGENT PRIOR TO USING THE SERVICE.

Far from singling out this company, I'm merely pointing out the fact that if you choose to rideshare, you need to find out what if any coverage is offered by the rental company should you wind up in an accident.  Since accidents can happen, you need to understand your responsibility if you should be involved in one while operating a rideshare company's equipment.  Unlike car rentals where drivers can fall back on their personal auto insurance to cover damages and injuries, if you rent an e-scooter, an e-bike, or some other exotic kind of vehicle, you may come to find that your auto policy excludes these rentals from coverage.  If that should occur, you could be held liable for property damage as well as the medical bills of anyone injured in the accident, plus damage to other vehicles, civil liability including lost wages or even wrongful death should the accident result in ta fatality  Even in Florida, where I live, PIP laws only provide coverage for 80% of my medical costs and 60% of lost wages if I'm unable to work due to a bicycle accident.  

When you consider the fact that most renters of scooters, mopeds, or other exotic forms of transportation have little or no experience operating them, this is a recipe for disaster.  Even if you own a scooter or a moped and have oodles of experience and even carry insurance that covers you when you ride it, your policy may not extend to rentals. The bottom line is before your next joyride turns into the highway to the danger zone, you should call your insurance agent to find out whether your coverage extends to renting anything other than a licensed motor vehicle with 4 wheels.  

Catherine Powell is the owner of A Plus All Florida Insurance in Orange Park, Florida. To find out more about saving money on all your insurance needs, check out her website at http://aplusallfloridainsuranceinc.com