Recently peer-to-peer ride sharing has exploded on the scene. It is either the next big innovation in the marriage between technology and social networking or it is the next big innovation since slap bracelets and silly bandz. Regardless of its future, ride sharing is here, and, at least for the immediate future, isn’t going anywhere.

With peer-to-peer ride-sharing services, drivers use their private vehicles to give rides to individuals who have requested them via a ride-sharing app. Prior to requesting a ride, the passenger is required to enter their credit-card information into the app, and upon successful arrival, the driver is paid via the app from the stored credit-card information. Sounds like a pretty good system, right? The driver picks up some extra cash, and the passenger gets where they need to go without breaking the bank.
But what happens when something goes wrong—something like a car accident? There are millions of car crashes a year. When an accident occurs, we exchange insurance information and then wait for the insurance companies to send a check to cover the damage and/or the medical bills.
However, when the vehicle you are traveling in is a ride-sharing vehicle, the outcome could be different. Most standard personal auto policies contain exclusions for livery, i.e., driving for hire. These exclusions could remove liability, medical payments coverage, uninsured motorists coverage, coverage for damage to your auto, and underinsured motorists coverage from your policy. This means that instead of saving or making a few bucks, you could be left to shoulder the burden of thousands and thousands of dollars’ worth of hospital bills and auto repairs.
Given the uncertainty surrounding insurance coverage for ride sharing, it’s important to speak with us first to ascertain whether you will have coverage in case of an accident if you are planning to use ride sharing, either as a driver or a passenger.