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By Jim Adler July 24, 2015

As new driving services such as Uber compete with taxis, limos and town cars, you may wonder how your car accident claim may be impacted if you’re injured in a crash involving Uber, or similar ride-sharing services such as Lyft. Our law firm can help you.

First, you should understand that cases involving companies like Uber and Lyft are part of a new and evolving legal field. Like many taxi services, Uber Technologies Inc. and Lyft Inc. involve drivers who own and operate their own cars. Unlike many taxi services, Uber and Lyft do not hire professional commercial drivers, but rather engage people as independent contractors to transport passengers on behalf of the service in their own personal vehicles — and often part-time.

These unmarked cars-for-hire are not hailed on the street like taxis. Customers must download an app through which they arrange rides with the nearest available vehicles associated with the service. Regular people just like them, “peer-to-peer” drivers also must be logged into the service’s app on their smartphone to learn when and where to pick up passengers.

Rides can cost more or less than a taxi. A fare study by Business Insider found that Uber fares are better than taxi fares in most cities. However, the same study showed that Uber calculates fares differently than taxis, charging riders per mile and per minute whether moving or idling, while taxis charge per mile when moving and per minute when idling.

However, you aren’t expected to tip an Uber driver, unlike with a cab, and fares are paid through the app, so no cash changes hands. Uber is available in Texas in Houston, Dallas, San Antonio, Austin, Waco, Lubbock, Amarillo and College Station. Lyft is available in Texas in the Dallas-Fort Worth area, Austin and Corpus Christi.

Filing an Uber Injury Claim

Riders who are injured during an Uber or Lyft trip may need to file an injury claim for their losses. If so, they can file such a claim against the driver, the driving service or the insurance company insuring the driver or service. Your case will depend on a number of factors, including proving liability (blame for the accident) and damages (cost of the accident).

Your Uber injury claim could start with a claim against the driver and his or her personal insurance company. You also could file a claim against Uber or Lyft, though the courts still are grappling with the legal liability of companies in this emerging industry.

Uber or Lyft may disclaim any liability for their drivers’ actions, asserting that such drivers were independent contractors who weren’t controlled by the service. However, their selection process for engaging drivers is being challenged in courts as inadequate, allowing unsafe drivers to pick up passengers. Plaintiffs have argued that Uber’s selection process for drivers is negligent and therefore establishes responsibility.

As Uber is connected to its drivers via a mobile application, that app itself could be construed as an institutionalized driving distraction, and thus constitute negligence on Uber’s part.

Uber Insurance Gaps

Unfortunately, even when there’s a strong claim, Uber insurance gaps can make it difficult to get payments. Unlike taxis, which are strictly regulated by law with strict insurance requirements, Uber or Lyft vehicles may not have adequate insurance coverage, though the services tend to add their own insurance to the mix.

Uber and Lyft both require their drivers to have personal injury insurance, also required by Texas law. Problems arise when drivers lack sufficient insurance to cover the losses of injured passengers and Uber or Lyft’s additional commercial insurance — which costs more — doesn’t exist or doesn’t apply.

When the only insurance coverage is the driver’s personal insurance, some insurers’ companies may balk at paying since an Uber accident involves a commercial use of the vehicle, not a personal one. Also in question is insurance liability when an Uber driver is “on the clock” but without passengers and hurts a pedestrian or someone in another vehicle.

Uber Lawsuits

That was the case in an Uber lawsuit stemming from a January 2014 incident in which an Uber driver hit a couple walking legally in New York, killing the man and injuring the woman. Additionally, there was another lawsuit filed in San Francisco involving a female pedestrian, 6, who was struck and killed by an Uber driver.

In each case, drivers were considered Uber software licensees and not employees. However, their use of Uber’s app while driving was claimed to be a violation of distracted driving ordinances or professional driving regulations. Uber insisted the commercial insurance it provided to drivers while carrying passengers did not apply when they lacked passengers, even though the Uber app was on while they awaited a wireless hail.

Uber later expanded its insurance to cover that gap and Lyft has since announced it will do the same. Otherwise, the services’ insurance would not provide coverage if the driver lacked passengers, and the driver’s own insurance wouldn’t help either if the app was on and he or she was engaged in commercial activity.

Uber Insurance Coverage

Uber recently announced it would expand insurance coverage for its drivers if their own personal insurance couldn’t cover a victim’s costs, provided the driver’s insurance covers $25,000 in property damage and up to $100,000 in bodily injury costs. Uber says it wants to eliminate possible insurance gaps with added commercial insurance. Lyft also provides some additional coverage options.

However, some insurers may still decline coverage when a driver is using his or her private vehicle for commercial use. Governing agencies are in conflict on whether to view such services as they do taxis and apply the same regulations. In fact, liability for the new industry is still being sorted out by the judicial system.

Houston City Council passed an app-based transportation ordinance in August of 2014 to clarify the legal situation for that city. The ordinance contained elaborate procedures for Uber and Lyft drivers to be licensed, including admonitions that their vehicle not be more than seven years old.

Lyft was unhappy with the ordinance and suspended operations in Houston three months later. Uber called the regulations “overly onerous” but remains in business in Houston.

In Dallas, regulations require a mechanic to inspect a peer-to-peer driver’s vehicle but the city is satisfied with Uber’s background checks of potential drivers. Houston and San Antonio, by contrast, want stricter standards for drivers, including fingerprinting.

Laws To Regulate Uber

To reduce confusion, in the spring of 2015 Texas legislators initiated attempts to create a state law to regulate Uber, Lyft and similar services. They hope to overcome what some see as a confusing regulatory patchwork across the state regarding the new transportation services.

In fact, new laws on a state level seem to be the wave of the future. Ten states already have passed laws regulating new transportation network companies, and similar laws are in the works in 27 other states.

Meanwhile, liability in Uber or Lyft car accidents remains in flux for passengers, pedestrians, bicyclists and other motorists. You’re advised to consult a personal injury lawyer in your city for the latest information on filing an injury claim involving app-based transportation services such as Uber or Lyft.

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