Jeffrey P. Gale, P.A. // Florida Uber and Lyft Riders and Drivers Beware!

Riders and operators of Uber and Lyft rides will be surprised to learn that they are barely covered by insurance or not covered at all for economic losses and personal injuries resulting from crashes caused by uninsured and underinsured motorists.

Florida Statute 627.748 outlines the insurance requirements for Transportation Network Companies (“TNC”) such as Uber and Lyft. When the TNC driver is logged on to the digital network but is not engaged in a prearranged ride, the insurance coverage requirements are:

• $50,000 for death and bodily injury per person,
• $100,000 for death and bodily injury per incident,
• $25,000 for property damage, 
• Personal injury protection benefits, and
• Uninsured and underinsured vehicle coverage (“UM/UIM”).

When the TNC driver is engaged in a prearranged ride, defined in 627.748(1)(b) as “when a TNC driver accepts a ride requested by a rider through a digital network controlled by a transportation network company, continuing while the TNC driver transports the rider, and ending when the last rider exits from and is no longer occupying the TNC vehicle,” the coverage limits above are bumped up to “at least $1 million for death, bodily injury, and property damage.”

Of the five varieties of coverage required by the statute, only the first four in the list above are mandatory. Uninsured and underinsured vehicle coverage, which is for the protection of persons insured under bodily injury policies who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of bodily injury, sickness, or disease, including death, can be rejected by the “insured named in the policy” on behalf of all insureds under the policy. Section 627.727(1), Florida Statutes.

While the TNC statute, 627.748, leaves it up to the companies or the drivers to secure the required coverage, the reality is that the companies secure the coverage. This makes the companies “the insured named in the policy” authorized to reject the UM/UIM. Since UM/UIM adds to the cost of the insurance policy, TNC companies typically reject the coverage (Lyft) or select limits lower than the required BI limits (Uber). (627.727(1) allows insureds to reject altogether or select limits lower than the BI limits. Hence, Uber is able to select $10,000 in UM/UIM coverage even though its BI is $50,000/$100,000 or $1,000,000.)

Given these realities, TNC drivers should consider purchasing UM/UIM on their own vehicles. CAVEAT: To avoid a denial of coverage following an accident, the driver must inform his or her insurance carrier during the application process that the coverage should include TNC driving.

If the TNC driver causes the crash, injured riders will be covered by the TNC’s bodily injury insurance, which, unlike UM/UIM, cannot be rejected. Even still, in  cases involving catastrophic injuries to multiple individuals, the $1,000,000 in coverage may not be sufficient to fairly compensate everyone injured. In this scenario, the UM/UIM issues discussed in this blog may impact those individuals.

Where the crash is caused by a party other than the TNC driver and the at-fault party failed to maintain BI or maintained inadequate BI policy limits, riders will face the UM/UIM problems discussed here. Namely, the TNC won’t have UM or the limits may not be adequate.

Some riders have a remedy. The remedy is set forth in F.S. 627.727(9)(c):

(c) If the injured person is occupying a motor vehicle which is not owned by her or him or by a family member residing with her or him, the injured person is entitled to the highest limits of uninsured motorist coverage afforded for any one vehicle as to which she or he is a named insured or insured family member. Such coverage shall be excess over the coverage on the vehicle the injured person is occupying.