Ridesharing services like Uber and Lyft have had a significant impact on the way residents of urban areas travel throughout their cities. Questions about liability for a potential car accident insurance claim against these services, however, have generated concerns among passengers and drivers alike. Understanding the laws governing liability and insurance for Uber and other ridesharing options can help consumers make the right choices in the personal transportation marketplace. Here is some clarification about legal developments in the ridesharing industry.
The Law Requires Added Insurance Coverage
Texas law requires that drivers maintain a minimum amount of liability insurance to operate their vehicles within the state:
- $30,000 in liability insurance for each person injured in an accident
- $60,000 in total insurance coverage per accident
- $25,000 in coverage for property damage incurred in an accident
These requirements apply to all drivers. However, drivers for ridesharing companies are subject to requirements that went into effect January 1, 2016. This law requires added liability insurance for drivers during times when their ride-hailing app is active but no passenger is in the car:
- $50,000 in liability insurance coverage for each person injured in an accident
- $100,000 in total coverage per accident
- $25,000 in property damage coverage per accident
Ridesharing drivers are required to maintain $1 million in insurance coverage when passengers are being transported in the vehicle. This coverage is generally provided by the applicable ridesharing company; Uber already maintains commercial liability insurance policies for their drivers that meet the revised Texas legal requirements.
Added Costs for Texas Ride-Share Drivers
Commercial liability insurance can be costly for drivers participating in ridesharing networks. These policies are required for most taxi drivers and constitute a significant cost of doing business in the commercial transportation industry. Companies like Uber, however, contend that the drivers who participate in ridesharing on their behalf are independent operators who must maintain their own insurance when passengers are not actually in the vehicle.
This is an important distinction because of the increased liability coverage required by the state of Texas for drivers who are active on these ride-hailing apps but who are not currently transporting a passenger. Any at-fault accidents that occur during these periods would be charged to the driver’s personal insurance policy. In some cases, failing to obtain commercial coverage could result in denials of claims or other negative results for ride-sharing drivers and for individuals seeking Houston auto accident compensation from these operators.
Legal Liability for Accidents Still in Dispute
The law is intended to protect pedestrians and other drivers against the added risks presented by drivers who provide rides through these alternative transportation services. Some auto insurance companies offer specific endorsements for Uber drivers that provide the added protection mandated by Texas law when no passengers are currently being transported.
Since these ride-sharing companies have asserted that they have no legal responsibility for accidents unless a passenger is actually in the vehicle with their drivers, individuals who are involved in an accident with a ride-sharing vehicle may experience difficulties in obtaining fair compensation for injuries and damages. This is especially likely in cases where damages significantly exceed the minimum liability coverage required in the state of Texas.
If you or someone you know has been involved in an accident with a driver for a ride-sharing company, consulting with an experienced Houston auto injury attorney can help you protect your legal rights in and out of court. Your attorney will represent you in negotiations with insurance companies to ensure that you receive the compensation to which you are rightfully entitled for your injuries and damages. This can provide you with the expert guidance and support you need to navigate the legal process successfully and to achieve the best possible resolution for your auto accident case.