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In November 2016, Pennsylvania passed a bill to regulate ride-share companies, like Uber and Lyft. The ‘ride-share’ law sets insurance standards, fee and licensing requirements for the companies, and inspection standards for the drivers.
The most important piece of the legislation is the requirement that ride-share drivers must obtain insurance that recognizes they drive for Uber, Lyft or a similar company. This closes the loop hole where a driver could forget to tell their automobile insurance company they are driving people around for money, allowing the insurance company to potentially deny coverage if passengers were injured in a crash.
The new ride-sharing act requires a driver to maintain insurance through a Transportation Network Company (TNC), which would recognize the vehicle as being a “vehicle for hire.” The act sets forth that a driver is required to maintain a minimum of $500,000 of liability insurance when engaged in a prearranged ride. This would be available to protect against losses for death, bodily injury and property damage.
The new law is anticipated to make the burgeoning field of ride-sharing safer for consumers who have come to rely on the services. The insurance requirements for the act can be found at 53 Pa.C.S. 57A07.
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In addition to PA's new law to protect ride-share passengers in the event of a crash, it is worth noting that some ride-share companies are also making moves to offer their drivers with additional insurance coverage; however, it comes with a cost to customers.
Uber has recently raised rates by 5 cents per mile in Pennsylvania and 7 other states, in an effort to have customers pay the cost of a pilot program to provide drivers with injury protection and income security insurance.
Uber now provides Pennsylvania's 20,000+ Uber drivers with the option of buying the injury protection insurance, which includes coverage for medical expenses and loss of income as a result of a work-related incident. The insurance also provides for disability income replacement and survivor benefits.
According to an Uber spokesperson, the maximum payout for a single collision is $1 million. There is no deductible or copay for medical expenses. Coverage applies while drivers are logged in to the app, and the cost to drivers is 3.75 cents-per-mile.
