Rideshare companies like Uber and Lyft have revolutionized the way people get around in the 21st century.
Cities with limited public transportation options and scarce local taxi services are now accessible thanks to a simple application download on a smartphone.
Even during the age of COVID-19, people still use rideshare apps to get around, while drivers can earn some extra cash for the family.
But like any other vehicles, rideshare cars get into accidents.
With extra concerns like company liability and multiple insurance carriers, an accident victim may not know what to do.
Here’s a short guide to Lyft car accidents, and what to do if you are involved in one.
What Is Lyft, and How Does It Work?
Lyft is one of the most popular and successful rideshare applications on the market today.
A customer downloads the company’s application on their smartphone, enters their name and payment information, and then is ready to ride.
The GPS function on your phone alerts nearby drivers that someone needs a ride, and once the driver confirms the trip, they are on their way to pick you up.
Once the trip is complete, all payments are done electronically and the driver can move on to the next rider.
Unlike taxi drivers, a Lyft driver uses their own vehicle. This means that it doubles both as a personal vehicle and a work vehicle, which can create real complications if they get into an accident.
Lyft Employment Status
While most rideshare companies do obviously have full-time employees, none of these are actually their drivers.
On Lyft’s website they clearly assert that “drivers are classified as independent contractors, and aren’t employees of Lyft.”
All drivers must take information from their IRS 1099 and file their own taxes. This is a move that Lyft and Uber use to cut down on costs.
Full-time employees must be provided certain benefits by law, so Lyft gets around this by calling all drivers independent contractors.
Most of the time, an “employee” is covered by their employer’s insurance policy when they are out doing business for the company.
Independent contractors are generally not covered by these policies. But when your business is giving rides, rideshare companies can’t use this excuse to avoid paying insurance.
Therefore, companies like Lyft have a special hybrid policy. Their drivers will primarily be on the hook for accident damages backed by Lyft’s additional coverage.
Lyft’s Insurance Requirements
All Lyft drivers are required by the company to have a personal auto insurance policy that meets minimum state coverage requirements.
The driver’s policy is in use any time they have the application off and are out doing personal things, like picking up the kids or buying groceries.
Lyft also provides third-party insurance coverage for drivers during two specific situations.
Application On, Driver Waiting for a Passenger
When a driver wants to go “on duty,” all they have to do is open the Lyft app and signal they are available to pick up passengers.
When the app is on and they are waiting, they can be covered by Lyft’s policy if their personal insurance won’t cover rideshare activities. The policy limits are:
- $50,000/person for bodily injury,
- $100,000/accident for bodily injury, and
- $25,000/accident for property damage.
This coverage is available to compensate you if a Lyft driver causes an accident.
Application On, Transporting or In-Transit to Passenger
When the driver is actually engaged transporting a passenger or on the way to pick one up, Lyft provides insurance for covered accidents:
- $1,000,000 for third-party auto liability,
- Uninsured/underinsured motorist bodily injury coverage, and
- Contingent comprehensive & collision up to the actual cash value of the car ($2,500 deductible).
Your attorney can help you determine which policy limits might apply to your claim.
Who Is Liable for Damages in a Lyft Accident?
If you are looking to file a personal injury claim, you might be confused as to whose insurance will cover the accident.
Because their drivers are independent contractors, this means that the company will usually not be liable for the negligent actions of their drivers. Even if the accident was entirely the Lyft driver’s fault, you will not be able to sue Lyft directly.
The most common approach to Lyft accident claims is to first file a claim on the driver’s personal policy if they were off-duty or their personal policy covers the “application on, waiting for a passenger” status.
But if a Lyft driver is in transit with a passenger at the time of the accident, the situation is different. Here, the driver is covered by Lyft’s primary liability insurance.
If a Lyft driver causes a car accident while they are carrying a passenger, this kind of coverage should be available to passengers and those injured in the other vehicle.
Injured in a Lyft Driver Car Accident? The Beliz Law Firm Can Help!
If you were injured in an accident with a Lyft or other rideshare vehicle, we know the aftermath is stressful.
After California failed to pass rideshare reform laws, it is more important than ever to seek a personal injury attorney in these situations.
At the Beliz Law Firm, we can help you navigate the complicated process of figuring out where to file your claim, whom you can sue for damages, and more.
Attorney Michael Beliz has over a decade of experience with personal injury cases in Long Beach, Riverside, and other cities in and around Orange County and has a proven track record of successful outcomes for his clients.