Uber and Lyft Drivers Have No Medical Coverage In an Accident
[Update: Initially the post noted that the driver mentioned in the Facebook Group was in an accident while on Uber but the driver was also Lyft. Also, a direct response from Lyft is posted.]
On Halloween week, a tragic accident occurred to a Lyft Driver and his two passengers. Unfortunately, one of his passengers did not survive the crash. You can read more about it here. After this incident came out, some drivers started to question the insurance coverage, especially how the driver and his passengers will be cared for after the accident from a medical standpoint due to the excessive injuries sustained.
There was a long discussion on the Uber Facebook Group as we all initially thought and assumed it was an Uber Driver. One driver chimed in that Lyft’s Insurance policy does not cover the driver for medical expenses! It does completely cover the passengers and anyone other than the driver, however.
Here are the insurance terms for Uber:
- $1 million of liability coverage per incident. Uber holds a commercial insurance policy with $1 million of coverage per incident. Drivers’ liability to third parties is covered from the moment a driver accepts a trip to its conclusion. This policy is expressly primary to any personal auto coverage (However it will not take precedence over any commercial auto insurance for the vehicle). We have provided a $1 million liability policy since commencing ridesharing in early 2013.
- $1 million of uninsured/underinsured motorist bodily injury coverage per incident. In December 2013, we also added uninsured/underinsured motorist coverage. In the event that another motorist causes an accident with an uberX vehicle and doesn’t carry adequate insurance, this policy covers bodily injury to all occupants of the rideshare vehicle. This is important to ensure protection in a hit and run.
- $50,000 of contingent comprehensive and collision insurance.* If a ridesharing driver holds personal comprehensive and collision insurance this policy covers physical damage to that vehicle that occurs during a trip, for any reason, up to $50,000 and with a $1,000 deductible.
- No fault coverage (e.g., Personal Injury Protection) is provided in certain states at similar levels as limos or taxis in those cities.
- $50,000/$100,000/$25,000 of contingent coverage between trips.** During the time that a ridesharing partner is available but between trips, most personal auto insurance will provide coverage. However the driver is also backed by an additional policy that covers driver liability for bodily injury up to $50,000/individual/accident with a total of $100,000/accident and up to $25,000 for property damage.
Here are the insurance terms for Lyft:
- Contingent liability coverage is designed to provide coverage when the app is in driver mode before you’ve received a ride request in the event your personal insurance does not respond. The policy has a $50,000 maximum per person, $100,000 maximum per accident, and a $25,000 maximum for physical damage. There is no deductible under this policy.
- Contingent collision coverage is designed to cover physical damage to your vehicle resulting from an accident as long as you have obtained collision coverage on your personal automobile policy. The policy has a $2,500 deductible and a $50,000 maximum for physical damage to your vehicle. ike any driver’s personal auto policy, this policy is designed to step in regardless of whether or not you’re at fault. This policy will respond if your personal auto policy declines the claim for collision damages to your vehicle solely because you are driving with Lyft.
- Contingent comprehensive coverage is designed to cover physical damage to your vehicle resulting from a non-collision event (for example a
fire, vandalism, a natural disaster, etc.) as long as you have obtained comprehensive coverage on your personal automobile policy. The policy has a $2,500 deductible and a $50,000 maximum for physical damage to your vehicle. Like any driver’s personal auto policy, this policy is designed to step in regardless of whether or not you’re at fault. This policy will respond if your personal auto policy declines the claim for comprehensive damages to your vehicle solely because you are driving with Lyft.- Uninsured motorist and Underinsured motorist. In the event of an accident (once you have accepted a ride and are transporting a passenger) with a driver who is uninsured or underinsured and is ultimately at fault for bodily injury caused to you, your passengers, or third parties, our UM/UIM coverage will apply for up to $1M per incident. There is no deductible on UM/UIM claims.
Lyft’s liability coverage is primary to your personal insurance. It’s designed to cover your liability for property damage and bodily injury of passengers and/or third parties.
Medical Insurance Coverages in an Auto Accident
So after reading through both insurance coverage, it seems that Lyft’s and Uber’s commercial insurance policy only covers passengers and third parties, and not the driver. Do you think there is something wrong there?
Here is Lyft’s response about medical coverage of the driver in the case of an accident:
Lyft’s $1M liability policy is designed to protect you from being held personally liable for an accident when you are at fault. It covers up to $1M in damages to the person and property of your passengers and the other driver. Liability insurance does not cover you or your car.
The rest of our insurance options, with the exception of UM/UIM, are designed to cover the cost of damage to your vehicle, and only if your insurance company denies your claim. These are contingent comprehensive and contingent collision.
UM/UIM is uninsured or underinsured motorist insurance, which functions as liability in the event that you are not at fault in a hit-and-run, or if the at-fault driver is uninsured or underinsured.
None of these policies will cover bodily injuries when you are determined to be at-fault.
Lyft drivers are independent contractors, and as such at this time our insurance does not provide worker’s compensation or lost wages.
More information on our insurance policies can be found at our Help Center:https://www.lyft.com/drive/help/article/1229170
Please do not hesitate to contact me if you have further questions about this topic.
Best,
Magda P.
Trust & Safety Specialist
In the case of an auto accident, it is the auto insurance that kicks in first. Here is a link I found on personal medical insurance coverage in an auto accident and here is the important aspects of the post:
Auto Policies Pay First
When it comes to actual insurance company responsibility for a car accident injury, the first payments are supposed to be charged against the auto policy in place. Most states require motorists to have personal injury protection. The amount of coverage can vary greatly, but medical bills will or should be charged up to the policy limits before actual health insurance should come into play at all for a car accident injury. Learn about car insurance rules in your state.
Cycling into Medical Insurance Coverage
Generally, medical insurance policies will start picking up bills for a car accident injury as soon as all other forms of payment are exhausted. What is covered and what is not will hinge on the policy itself. Injured parties will likely still have to pay:
- Their deductible amount under their health insurance policy
- Any co-payments that are required under a health insurance policy
- For any charges that are not typically covered by the policy.
Recovering Expenses
If the injured party in question is not the at-fault driver, the insurance companies involved may work behind the scenes to get the at-fault party’s policies to absorb some of the costs. Victims of car crashes can also sometimes recover some of their out-of-pocket expenses by making that part of any car acciddent settlement agreement with the at-fault driver and/or their insurance carrier.
Personal Health Insurance
So if you get into an auto accident on Lyft, it may be up to your private health insurance policy to kick in to protect you. As it is open enrollment season for my health insurance, I looked at two popular plans at my current workplace and my previous workplace:
- HDHP (High Deductible Health Plan, or also known as CDHP Consumer Driven Health Plan) – These policies have much lower premiums but if you get into an accident, you will need to fulfill the deductible amount which is often $1500 per person. It is the worst when its you and a significant under the same plan. The deductible is double that, even if only one of you is in an accident, so it could be as high as $3000 for the year before the insurance will start to pay for your medical coverage. I would take a long look at this policy if you intend to do Lyft or Uber
- When I had this plan, I put in a lot of money in the first year to make sure I had a nest egg to cover the deductible. I ski and run a lot so I would be what you call risk prone. A lot of things can go wrong, like snowboarding the wrong way and almost dying snowboarding on an active volcano (that’s a story for another day.)
- PPO – This is the plan I am going with now. It is a bit more ($34 a month) but the deductibles are much lower. The plan I have has a $250 deductible, or $500 for a family (two or more people). This is much lower and I feel much safer with this deductible as if I get into an accident with Lyft or Uber and no one decides to pay, at least my personal health insurance will kick in.
I am hoping that both companies amend their insurance policies to cover drives as well. We are at risk of losing everything if we get into one little accident. Luckily we are covered from a liability standpoint, but what about us? What about our own health?
(The above figures were provided by http://consumer.healthday.com/public-health-information-30/misc-insurance-news-424/more-employers-will-offer-high-deductible-health-plans-690749.html)
Uber and Lyft Insurance Deductibles
Now all of this is on top Lyft and Uber’s insurance deductibles, which are $2500 and $1000, respectively. So even if you were not at fault for an accident while on Lyft, you could expect to pay $2500 up front for your vehicle and accident, and potentially another $3000 towards your own medical bills if you have a HDHP or CDHP. That could be $5500 for just one accident! For Uber, this would be about $4000. This example was only if you are at fault. If you are not, then you would only pay $2500 for Lyft or $1000 for Uber as the health portion of it would be covered by the other party.
This is a terrifying conclusion to come to, especially when many Americans and employers are moving to HDHP plans because of lower cost. But what many Americans may not realize is the high deductible. I saw that the instant my workplace first gave us this option two years ago. I was a bit worried about the deductible, especially since this was the only health plan between my wife and I.
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