The Effects of Ride Sharing on Auto Insurance

Ride sharing takes the idea of carpooling and expands it beyond an individual’s social circle. The idea is to give people an option that is cheaper than a cab, more convenient than public transportation, and more eco-friendly than everyone owning their own car.

Ride sharing takes the idea of carpooling and expands it beyond an individual’s social circle. The idea is to give people an option that is cheaper than a cab, more convenient than public transportation, and more eco-friendly than everyone owning their own car.

With ride sharing becoming a more popular tool, are sanctions against companies and their drivers becoming too much or is it a way to keep the question of liability clear because insurance in Orlando doesn’t account for such a service?

According to myfoxorlando.com, starting at the end of April, drivers for Lyft and Uber will be ticketed after previously being given verbal warnings. The fines levied against the drivers can go up to $800. However, Lyft has said it would cover the fines for drivers in this area.

What is odd is it’s reluctance to cover costs incurred previously by drivers for other reasons, such as an accident that occurs while working under their name. It does not take into account Orlando insurance that would cover a service such as this and does not discuss the discrepancies in the coverage it provides its drivers on a regular basis across the country.

Ride sharing takes the idea of carpooling and expands it beyond an individual’s social circle. The idea is to give people an option that is cheaper than a cab, more convenient than public transportation, and more eco-friendly than everyone owning their own car.

There are several variations on this concept:

  • Sharing personal cars with strangers in a manner similar to more traditional carpooling
  • Rent out personal cars to others for them to drive when the car is not needed by the owner
  • Making the decision not to own a personal car, renting a car only when it’s necessary

Currently, participation in these services remains relatively small. There are approximately 518,520 drivers sharing 7,776 vehicles through 27 programs across the country, but industry continues to grow.

However, because these drivers do not have to get a specific license for this type of service, Orlando insurance agencies are unsure of how to handle them because driving commercially voids a personal insurance plan, but the cost to get a commercial insurance plan is far too astronomical for most individuals to even consider. Without the companies stepping in to provide this coverage for their drivers, they are often unknowingly left uncovered.

The issues involved in ridesharing companies are complicated and need to be solved quickly with cooperation from the services themselves, Orlando insurance agencies, and the government. Perhaps the most logical solution would be to develop a new category of coverage designed for ridesharing services and those drivers who participate in them. This would allow for insurance in Orlando to still work within certain parameters, while allowing themselves to grow and adapt to the world around them as it changes to allow for services such as ride sharing services like Lyft.

  photo credit: Nic Taylor Photography cc

Frank

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