How Ridesharing May Affect Your Car Insurance in Georgia

Ridesharing has become a popular way for many residents of the Atlanta metropolitan area to earn additional income via smartphone apps like Uber and Lyft. Before you sign up to offer rides for money, you should check with your car insurance company. Many standard insurance policies exclude coverage for “public or livery conveyance.” In fact, your existing policy may be canceled if you start offering rides for money without notifying your carrier. If you are in an accident while driving for Uber or Lyft, you may be on the hook for any damages.

Haulers Insurance Co. v. Davenport

What if you are just giving a friend a ride for no payment? Could your insurer declare that you were actually providing a livery service and refuse to cover your accident? According to a recent decision by the Georgia Court of Appeals, the answer is probably no.

The plaintiff in this case sought uninsured motorist benefits from his insurance company following a parking lot accident. On the day in question, the plaintiff was driving his car when he saw a friend walking into town. He offered her a ride. Arriving a few minutes later at a local post office, the plaintiff started to pull into an open parking space when the driver of the vehicle parked in the adjacent space opened his door, which collided with the plaintiff’s car. As a result of this impact, the plaintiff said he suffered a serious neck injury.

The insurance company argued that it was not liable for coverage since the plaintiff was giving a ride to his friend at the time, citing an exclusion in the policy for injuries arising from the use of an insured vehicle “as a public or livery conveyance.” Both the trial court and the Court of Appeals rejected the insurance company’s interpretation of this event. The Court of Appeals said the livery (or taxicab) exclusion would only apply when the insured driver “present[s] his services indiscriminately to the general public for hire.” Merely offering occasional rides to friends, even for nominal compensation such as gas money, would not be sufficient to trigger the exclusion.

Protecting Yourself While Ridesharing

Of course, had the plaintiff been working as an Uber or Lyft driver, the outcome of this case might have been different, even if the passenger happened to be a friend. Indeed, if you participate in any kind of ridesharing service, you should never assume that an accident will be covered by your existing auto insurance policy. Nor should you count on the ridesharing company to step in and provide complete coverage.

That said, many Georgia auto insurers now offer rideshare-specific policies. But you need to carefully review any such policies to understand the exact scope of coverage. For instance, some policies only cover drivers when they are en route to a scheduled pickup or transporting a passenger, but now when they are “idle” and waiting for an assignment. Other policies offer comprehensive coverage to drivers regardless of whether they use their vehicles for personal reasons or to provide ridesharing services.

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