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Lyft Launches Coalition to Bridge Ridesharing Insurance Gaps

Mike Hower
| Friday February 14th, 2014 | 1 Comment

Lyft Car In the wake of the tragic New Year’s death of a 6-year-old girl in San Francisco caused by an on-duty Uber driver, along with another recent collision involving a Lyft driver, the public’s attention has turned to the insurance gaps in the fledgling ridesharing industry. To help bridge these gaps, Lyft announced last week a new Peer-to-Peer Rideshare Insurance Coalition, comprised of transportation companies, regulators, insurance providers and other stakeholders that have come together to address how the insurance industry can continue evolving to support the ridesharing economy.

With the California Public Utilities Commission (CPUC) as a founding member, the coalition’s mission is to build a foundation of insurance best practices, policies and information for P2P ridesharing. Earlier this week, Lyft published an official list of the coalition members, which in addition to Lyft and CPUC includes: Sidecar, National Highway Traffic Safety Administration for U.S. DOT, Allstate Insurance, Esurance, Farmers Insurance and even Uber (although initially it was reported that Uber would not take part).

Lyft says the coalition will work to drive additional partnerships between insurance carriers and P2P ridesharing participants, while providing information resources for regulators, drivers and riders to “ensure a safe and trusted future for the emerging peer economy.”

Since launching a year and a half ago, Lyft says it has successfully increased transportation safety in three fundamental ways:

  1. Established background check and driving record standards that are more strict than taxis, limos and black cars and the most stringent in the industry;
  2. Used technology to create more accountability and trust through in-app feedback, ratings and photos as the only company in the space to have all these elements for both passengers and drivers;
  3. Pioneered the first-of-its-kind $1 million excess liability policy in 2012.

Lyft says after working with insurance carriers, it can now provide additional insurance solutions for Lyft drivers, including:

  • Collision: Contingent policy – $2,500 deductible and $50,000 maximum applicable to drivers who have purchased collision coverage on their personal policy;
  • Uninsured motorists: Added to $1 million Excess Liability policy – covering drivers if they are hit by an uninsured motorist that is at fault;
  • Underinsured motorists: Added to $1 million Excess Liability policy – covering drivers if they are hit by an underinsured motorist that is at fault.

There is no doubt it will be some time before all of the insurance and liability questions surrounding the sharing economy, especially those related to ridesharing, are answered. But it is heartening to see Uber and Lyft working together for the public interest, even as they continue to be engaged in bloody competition for ridesharing supremacy.

Uber has been taking advantage of its more than $200 million investment from Google Ventures to bring Lyft, it’s main rival, to its knees. For example, last year Uber launched a “Shave the Stache” campaign, which featured Lyft-bashing ads plastered on the sides of trucks and, perhaps ironically, city buses. The ads criticized Lyft’s “donation” approach to payment and sought to convince drivers to switch to Uber.

Image credit: Flickr Spiros Vathis

Based in San Francisco, Mike Hower is a writer, thinker and strategic communicator that revels in driving the conversation at the intersection of sustainability, social entrepreneurship, tech, politics and law. He has cultivated diverse experience working for the United States Congress in Washington, D.C., helping Silicon Valley startups with strategic communications and teaching in South America. Connect with him on LinkedIn or follow him on Twitter (@mikehower)


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  • Robin Chase

    I can’t even get to reading the article with that headline. Uber, Lyft and Sidecar are NOT ridesharing! Ridesharing is when the driver of the car is going some place for their own reasons, and gives other people who want to go on the same route, a lift. California legislature is now calling these three companies “transportation network services.” I also think of them as “people’s taxi.” But when you call it ridesharing, you screw up and confuse a hundred years of built up academic and policy work around real ridesharing.