Man waving to his rideshare driver in the distance

Are Rideshare Companies About To Become Directly Liable for Accidents?

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Accidents that involve for-hire cars from rideshare companies like Uber and Lyft are an unfortunate fact of life.

Accidents that involve for-hire cars from rideshare companies like Uber and Lyft are an unfortunate fact of life. Although these accidents happen all the time, the companies have managed to protect themselves from personal injury lawsuits from victims, largely via insurance and forced arbitration. But their success in doing so could be changing.

The Current Situation: Rideshare Companies Avoid Direct Liability

Writing for Money magazine last year as a pedestrian hit by an Uber driver, Alicia Adamczyk notes:

It turns out, if you’re ever in an accident involving Uber or Lyft, you likely won’t sue the ride-sharing company outright, according to multiple lawyers. Drivers are technically independent contractors, not employees, meaning the company can deny liability for crashes involving their drivers…

Later in her piece, Adamczyk quotes Georgia-based personal injury attorney Jeb Butler about what to do after a ridesharing accident. Butler usefully advises that besides calling 911, taking pictures of the wreck, and getting all possible contact information from the driver and any witnesses, you should document your ride and receipt on your phone.

Adamczyk further fleshes out liability in the rideshare industry:

If the accident occurs during the course of your trip and your ride-sharing driver is at fault, you are covered under a $1 million liability policy that both Uber and Lyft have through James River Insurance, says Butler. If you need to file a lawsuit, you would sue the at-fault driver (not Uber or Lyft directly) and serve copies of the lawsuit documents on that driver, says Butler, as well as on the insurance company. Chances are the driver will not be able to pay your medical bills, which is why the companies offer these policies.

As noted by ridesharing watchdog websites like Who’s Driving You?, both Uber and Lyft have faced plenty of legal actions across the world, although a majority of those seem to concern assaultive driver behavior rather than accidents.

A Change May Be Coming

But a least a few lawsuits are testing this conventional wisdom that insurance policies shield the companies from personal injury legal action after an accident. We noted one of these cases earlier this year, brought by Orange resident Brendan Brock, who lost both legs due to an accident that happened while he helped move his Uber driver’s disabled vehicle to a shoulder off of a freeway.

Another case reported by Reuters reporter David Schwartz that poses significant implications involves an Arizona woman who in March became the first pedestrian killed by an Uber self-driving car. Although the car involved in the incident was being tested and thus had a human driver as backup, Schwartz notes that the potential for future challenges is clear:

The fatality also presents an unprecedented liability challenge because self-driving vehicles, which are still in the development stage, involve a complex system of hardware and software often made by outside suppliers…

Many companies [like Uber and Lyft] include forced arbitration clauses in contracts with customers, requiring that any disputes be settled in binding arbitration and barring customers from suing in a court of law. Arbitration rulings, generally, cannot be appealed.

Because people are regularly suffering permanent injuries in accidents that involve rideshare vehicles, these potential precedent cases are hugely important, and we’ll be sure to keep you updated.


If you or a loved one has been injured in a rideshare accident and you need help getting compensated, contact Hales & Associates, A Professional Law Corporation in Murrieta at (951) 489-3320 for a free consultation. We’ll do everything we can to get you the best possible outcome commensurate with your specific situation.

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