Are You a Ride-Sharing Service Driver? What Happens If You’re Injured While On the Job?
So you’ve heard everyone talking about how easy it is to make money driving for a ride-sharing service such as Uber or Lyft. You’ve decided that making a few extra bucks would be great, so you begin preparations. If you’re like most prospective drivers, your to-do list will look like this:
1. Tune up and clean your car.
2. Contact the ride-sharing company.
3. Plan a schedule and start transporting people.
Unfortunately, too many ride-sharing service drivers don’t think about insurance. Specifically, what insurance coverage will be available should you be involved in an accident while you are driving for a ride-sharing service?
As the ride-sharing driver, there are a variety of factors you need to think about with regard to insurance in case you ever are injured while behind the wheel of your personal vehicle.
Understanding Livery Conveyance
Before you can understand the potential problems that driving for a ride-sharing service creates in a typical personal auto insurance policy, you first must know the meaning of an essential term often used in that policy—“livery conveyance.” According to the International Risk Management Institute, this term means “the transporting of people and/or goods for hire, such as by a taxi service, motor carrier, or a delivery service.”
Livery conveyance is an exposure that is almost always excluded in personal auto insurance policies.
Many personal auto insurance policies include an insurance coverage called “medical payments.” This coverage will pay reasonable medical expenses up to a set limit (it may be as low as $1,000) should you be injured in an accident. Unfortunately, most personal auto policies will not pay this coverage if the accident occurs in the course of employment or if it occurs while the car is being using as a livery conveyance.
Uninsured or Underinsured Motorist (UM/UIM)
This important insurance coverage is often included in a personal auto insurance policy and is designed to compensate you should you be injured in accident with an at-fault driver who has no insurance (UM) or not enough insurance to compensate your full damages (UIM).
This coverage can differ significantly from policy to policy, but it’s likely that your own personal auto policy will also exclude this coverage while your car is being used as a livery conveyance.
Workers Compensation & Health Insurance
Workers compensation insurance is designed to cover medical bills and other expenses resulting from on-the-job injuries. The workers compensation laws of your state will typically dictate if and when an independent contractor is required to secure workers compensation. As a ride-sharing driver, you would be considered as an independent contractor.
Many personal health insurance policies will not cover medical bills resulting from work-related accidents. We can help you review your health insurance policy to determine what coverage—if any—will apply if you are injured while driving for a ride-sharing service.
Personal Injury Protection (PIP)
Some states require drivers to purchase personal injury protection to cover expenses incurred as a result of an injury suffered in an auto accident. In other states, personal auto insurance companies offer this insurance coverage as an optional purchase. We can help you determine what coverage—if any—will apply under your PIP insurance should you be injured while driving for a ride-sharing service.
A typical personal auto insurance policy is not designed to cover your injuries if they occur while you are using your car as a “livery conveyance.” The extra money you earn driving for the service may seem insignificant should you suffer an uninsured loss. For information about how to protect yourself before you take that first fare, contact your River Oaks Insurance Agent.