Facing growing criticism over a car accident that killed a 6-year-old San Francisco girl, Uber extended its insurance policy Friday to provide coverage for independent drivers who have their Uber apps online but aren't carrying passengers.
In the past, Uber's insurance for peer-to-peer service UberX only kicked in when an accident occurred while passengers were on a ride. It did not cover any incidents that happened while the driver was between rides but available for service. Only the driver's personal insurance applied in those cases. Now, Uber's contingent coverage for a driver's liability is $50,000 per individual for bodily injury, $100,000 total for bodily injury, and $25,000 per incident for property damage, according to a blog post.
Uber CEO Travis Kalanick said during a press call that he thinks insurance companies will eventually have options specifically for peer-to-peer transportation drivers, but until then he hopes Uber's additional coverage will serve as a stop gap.
When asked about insurance companies saying they won't cover drivers at all if they drive for these services, Kalanick said Uber is working to make them feel more comfortable with the new peer-to-peer industry.
"Insurance companies are taking actions that we don't think are justifiable, but we will work with them," he said.
The company came under fire when an UberX driver hit and killed 6-year-old Sophia Liu in San Francisco on New Year's Eve. The driver was not carrying a passenger during the accident, so it wasn't covered by Uber's insurance policy at the time. The girl's family has sued Uber for wrongful death.
The driver's personal insurance policy fully covered the accident, according to Uber, but the company said it recognizes that other policies may not be as clear.
"This didn't really fall into a gap. The personal insurance for that driver has already offered to cover the incident...but that doesn't mean we shouldn't cover the gap," Kalanick said when asked about the accident.
Drivers are covered by their own insurance according to the terms in their policy or state law, according to Uber, but the rise of services like UberX, Lyft, and Sidecar has created a much more ambiguous environment for insurance providers and drivers. The three companies are members of a coalition set up to address the issues around insurance for peer-to-peer services. Uber is hoping its new policy will help clear this up, and the company mentioned that Lyft also will be rolling out similar coverage over time. Lyft confirmed that it is rolling out this additional protection state by state soon.
"The bottom line is that the drivers who use our app and the riders and communities we serve should have the confidence that any potential 'insurance gap' is covered with a safety net as governments and insurance companies work out the details of ridesharing in their cities and states," reads Uber's blog post.
Update, 9:54 p.m. PT: Added information from Uber's press call and a confirmation from Lyft regarding its additional insurance policy.