Uber, Lyft Come to Tampa, but Insurance and Liability Questions Are Sure to Follow

Lyft and Uber, two services that provide access to vehicles for hire via smartphone apps, recently began operating in Tampa. This is despite staunch opposition from industry and regulators. Taxi and limo operators want the Hillsborough County Public Transportation Commission to ticket the companies’ drivers for what they say are violations of local laws. Meanwhile, state legislators seek to allow county residents to vote on whether to disband the Commission.

But the two services’ problems are more than regulatory. Uber and Lyft also face questions of liability in case of accidents and provisions for sufficient insurance coverage.

Each company has stated that it has excess liability insurance of up to $1 million per accident. That insurance takes over if the driver’s personal insurance is exhausted. Uber has expanded its insurance coverage several times already in 2014. In March, the company began covering the period when a driver has the app active but is not carrying passengers. That gap in coverage came to light when a driver in San Francisco struck and killed a 6-year-old girl. He was logged into his Uber app but was not carrying passengers.

Lyft operates slightly differently than Uber in that it markets itself more as a “ridesharing” service than a “vehicle for hire” service. Drivers do not directly charge fares; instead, passengers give them “donations.” These designations could add yet another layer of confusion over liability after the inevitable accidents that occur in any transportation service.

Regulators in Ohio and California have issued consumer alerts warning of possible gaps in liability insurance for so-called “transportation networking companies” (TNCs). A recent alert from the Ohio Insurance Director named medical payments coverage, uninsured motorist coverage and comprehensive coverage as possible shortcomings in TNC insurance.