Uber announces new insurance policy covering drivers between fares

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A hydrant hit by a private taxi operating in partnership with Uber was sent flying, leaving this geyser pouring over Divisadero
Photo courtesy of @lastraw/TWITTER

Controversial tech-ride provider Uber will now expand its insurance for drivers, it announced on its blog today. 

Transportation Network Companies, more commonly known as "rideshares," have operated in legal limbo regarding their insurance since their creation. This came to a head on New Year's Eve with the death of six-year-old Sofia Liu, who was killed in a collision with an Uber car driven by a man named Syed Muzzafar. Uber claimed in a blog post that because Muzzafar was not ferrying a passenger at the time, and only using the app to search for fares, that he was not officially covered by their insurance.

It was an insurance gap that left the driver on the hook for the death of a little girl and the injuries of her family. San Francisco Municipal Transit Agency Taxi Director Christiane Hayashi estimated the lawsuit to be at around $20 million, based on her experience. No amount has been specified by either party as of yet, but so far Uber has not compensated the family for Liu's death.

Now it seems there's a glimmer of hope that future collisions may be covered. 

As Uber wrote on their blog today:

"In order to fully address any ambiguity or uncertainty around insurance coverage for ridesharing services, Uber is becoming the first and only company to have a policy in place that expands the insurance of ridesharing drivers to cover any potential 'insurance gap' for accidents that occur while drivers are not providing transportation service for hire but are logged onto the Uber network and available to accept a ride." 

The policy will cover $50,000/individual/incident for bodily injury, $100,000 total/incident for bodily injury and $25,000/incident for property damage, according to their blog post.

But Sofia Liu's family is still out of luck, apparently. 

The blog specifies that the money will not kick in if a driver's personal insurance covers a collision, and that seems to be the case with the New Year's Eve incident.

In an interview with the San Francisco Chronicle, Uber CEO and co-founder Travis Kalanick said that the Syed Muzzafar's personal insurance policy had offered to pay the claim, but had not yet followed through.

When we contacted Uber's spokesperson, Andrew Noyes, to offer proof of this, he declined.

Uber has also promised insurance coverage before, in the form of their $1 million policy. But still many pedestrians and passengers have filed suit with the company when Uber declined to pay for their medical coverage, like Claire Fahrbach, a woman who was walking down Divisadero when an Uber car hit a fire hydrant, sending it flying into her. Her injuries were substantial, and she quit her two jobs. She immediately left San Francisco to live with her parents for financial and medical support. Her hospital bills are steep, and she is currently tangled in a lawsuit with Uber.

When we asked Noyes if the new policy agreements would allow Uber to pay out insurance to the many injured passengers and pedestrians suing Uber for coverage, Noyes would only speak off the record. But in case you're wondering, it all basically amounted to "no comment."

Uber's lack of coverage extends well beyond Fahrbach and her injuries, with drivers nationally left uninsured to various degrees. Popular car insurance provider Esurance wrote about it on its blog shortly after Valentine's day:

“Though TNCs are now required to carry $1 million in liability insurance, this coverage is designed to protect riders and pedestrians and pay for damages to other vehicles. The policy doesn’t have to cover the driver’s car or the driver’s injuries (and it doesn’t kick in at all unless the TNC driver is found at fault). And because of the livery exclusion, the driver’s standard personal insurance likely won’t cover accidents either. So, instead of adding to their income, the TNC driver could be left holding the bag.

...

Though we can’t speak for all insurance companies, the livery exclusion is pretty universal. According to our definitions of coverage, TNC drivers would need commercial insurance since a personal auto policy through Esurance doesn’t cover both personal and commercial use of a vehicle. In all states except California, we’re unable to offer a standard policy to TNC drivers. And in California, the driver’s standard coverage doesn’t apply during a ride-share trip.

If you’re driving for a TNC, the California Department of Insurance urges you to contact your insurance company and see if there are gaps in your coverage that are putting you at risk. You might be better off with a commercial policy. (Esurance doesn’t offer commercial auto insurance, but you can get it through our partner.) Since Lyft is already available in 20 cities (and UberX in dozens), this is good advice no matter where you live.”

So Esurance’s personal policy does not cover an Uber driver, and other insurance companies have stated on the record at KQED and other outlets that they won’t cover personal or commercial insurance for a TNC driver (like Uber). 

Notably, a coalition of rideshares including Lyft and Sidecar and a handful of insurance companies banded together to develop new insurance policies. The group’s work is ongoing, though the intent looks positive -- new insurance policies specific to Transportation Network Companies developed by a coalition of industries would be a great step for driver, passenger and pedestrians alike.

But for now, commercial and personal insurance policies rarely, if ever, cover TNC drivers. And Uber’s new insurance? It’s great, as long as Uber follows through.

Comments

Just like they didn't stop whining when the tech shuttles reached an agreement with SFMTA.

SFBG doesn't want solution, only conflict.

Posted by Guest on Mar. 14, 2014 @ 9:26 am

Won't stop whining?!? You've never been attacked by a lawyer before and I hope on day you are. If there is not a 100% guarantee that UberX drivers are covered for 100% of damages results from their actions to themselves or others and their property or others, the person trying to get ahead as an Uber Driver will be 100's of dollars in debt and go into bankruptcy.

Posted by Guest on Jun. 20, 2014 @ 2:07 pm

You cannot immunize yourself against all risks. Deal with it.

Posted by Guest on Jun. 20, 2014 @ 2:15 pm

so, there's been no demand in the case, the driver's insurance has offered to pay, and yet Uber has refused to pay

do you even read what you write?

Posted by guestD on Mar. 14, 2014 @ 10:20 am

Uber and Lyft have once again tried to skate by doing the absolute minimum when it comes to protecting the public with insurance. The insurance industry has stated over and over that the drivers of TNC cars will not be covered by their personal insurance policies. But Uber insist that they only need to buy a policy that is secondary not primary for their drivers.
So now they have a $100,000.00 policy when the driver is empty but looking at the App and runs over a pedestrian. Where if there is a passenger in the cab and the driver runs over a pedestrian the limit is $1,000,000.00. Seems the pedestrian better hope there is a passenger in the car.
In either case the personal insurance of the driver is considered by Uber to be primary, this is wrong. Uber and Lyft, should have a primary policy for 1million dollars just as the Taxi Cabs are required to have.
Think carefully before you and a loved one gets in a TNC vehicle

Posted by ricklars57 on Mar. 14, 2014 @ 10:59 am

Your own insurance kicks in first.

Posted by Guest on Mar. 14, 2014 @ 11:26 am

Why should this surprise anyone. The TNC's do not play by the rules. Taxi's and PUC limos all have to have proper insurance, background checks, and maintain there vehicles. They have to have permits for airports and follow the rules. The TNC's do not do any of these things. Instead choosing to do everything under the table, lack insurance, and god only knows who the driver is and their ability to drive. If your a risk taker, hop into a TNC, if not, hire a Taxi or a Limo that costs more, but at least follows the rules and has insurance.

Posted by Guest on Mar. 14, 2014 @ 11:20 am

I can pay a higher fare with more insurance or a lower fare with lower insurance.

I have control - not some bureaucrat.

Posted by Guest on Mar. 14, 2014 @ 11:33 am

that's right because you as the passenger always have the upper hand to sue the Uber driver or to sue the car that hits the uber driver. But did you know that Uber drivers don't own equity and when you sue them you'll get D*@k?

Posted by Guest on Jun. 20, 2014 @ 2:09 pm

I'm willing to bear the risk, so who are you to tell me I cannot?

Posted by Guest on Jun. 20, 2014 @ 2:16 pm

I keep waiting for that Twitter check David Campos promised everyone though - where is my free cash money from Twitter?

Posted by Guest on Mar. 14, 2014 @ 11:52 am

taxes you would otherwise have had to pay if Twitter had moved to Brisbane and paid no SF tax.

Posted by Guest on Mar. 14, 2014 @ 12:07 pm

What exactly is a 'tech-ride' ? A ride service that has a website?

Is that like how the SFBG is a tech-weekly news outlet, since the SFBG also has a website?

Posted by Guest on Mar. 14, 2014 @ 1:18 pm

If you are interested in sustainability, please do not patronize any carshare service that utilizes gas-guzzling limos, town cars or large SUV's. Is it so hard to make the slightest "sacrifice" by using a service that generally involves smaller cars? I have no financial stake in these services, nor do I use them. But in this supposedly informed, liberal and enviro-conscious city, I am appalled at the lack of attention paid to this issue. Big, (usually) black carshare SUV's careening around City streets is what I saw in my last visit to NYC last fall and now they are here in a big way. Town cars with one passenger? Whahzzup with that? Make a statement by avoiding them. A small vehicle will get you around just fine. No one is going to see you behind that dark glass anyway.

Posted by Guest on Mar. 18, 2014 @ 2:00 pm

larger vehicle.

Why are liberals always trying to stop people doing what they want?

Posted by Guest on Mar. 18, 2014 @ 2:22 pm

Many of these patrons are *individuals* using these services. The resurgence of big SUV's! Haven't we progressed during the last decade? I ask that people take some sort of personal and societal responsibility.

Posted by Guest on Mar. 18, 2014 @ 10:55 pm

What about a large order of fries?

Did we enter a "war on size" and I missed the memo?

I don't want to live in a world where people try and tell other people what kind of vehicle they can travel in.

Posted by Guest on Mar. 19, 2014 @ 10:48 am

Insurance services are very necessary for the people. This will really useful in case of various things those have been used by the people and for new things also. Various Insurance agencies are there for the Insurance services and people should prefer any of the affordable Auto insurance services as responsible car users. http://www.paytonins.com/

Posted by Stanley Smith on Jun. 09, 2014 @ 7:19 am

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