Uber And Lyft: Liability in Car Sharing Accidents

Uber and Lyft Liability in Car Sharing Accidents

Real-time ridesharing is a service that provides transportation at a short notice. This service requires GPS navigation capability, a Smartphone, and access to one’s debit card. The major difference between real-time ridesharing services and ordinary taxicab services is the employee/employer relationship. If a passenger were to be involved in an accident the liability would be attributed to the taxicab company under the theory of vicarious liability. Conversely, a passenger using a ridesharing service will be limited in collecting only from the driver due to his role as an independent contractor.

Uber, a new traveling craze that has become popular in the most recent years, provides convenience and efficiency to its customers. Customers have the ability to not only request a ride, but they are able to pay for the ride via their Smartphone. Uber drivers use their own vehicle to transport passengers. One might say that Uber is a “go-between” or 3rd party whom offers a service. Uber has received criticisms in regard to their screening process and failure to properly train their drivers. Additionally, issues of liability is accidents have arisen.

Lyft, a competitor of Uber, is privately-owned and offers the identical service of peer-to-peer ridesharing. The major difference between the service providers is the fact that Uber exists in more major cities than the smaller company, Lyft.

Potential drivers for both companies are required to submit to a criminal background check, DMV background screen, and car inspection. There is no on the road training and further the drivers, if hired, are required to maintain their own insurance. Uber and Lyft overcome this hassle because of the condition that drivers use their own vehicle. Thus, in the event the driver is involved in the accident and the passenger is injured, if the driver’s insurance has a limit of $750,000 coverage that is all the passenger is able to collect.

Last year, Georgia legislators pushed for House Bill 907, which would require those operating ridesharing services to adhere to the same strict guidelines as those in operation of taxi services. In order to level the playing field between the two industries and access sufficient liability the State of Georgia has decided to regulate the screening process of drivers itself. First, Uber or Lyft would have to register with the state annually and pay a fee of $100.

Next, Uber and Lyft would continue to screen drivers as they normally would, but now that information would be forwarded to a state agency for additional review.

Finally, drivers are required to maintain coverage that meets the same standard as limo drivers or car services. Many ridesharing advocates suggest that this new law will completely defeat the efficiency and practical reasons for which ridesharing apps came about.

With the regulation of higher insurance coverage, there may be an unavailability of drivers. This may also increase the rate offered to passengers and result in a “regular taxicab service.” The State of Georgia believe that with more strict regulations and a hefty $50,000 fine for a violation, there will be a decrease in accidents involving rideshare services and those services will be accountable.