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.
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.