Skip to main content
Report this ad

See also:

Chicago city council begins investigating rideshare insurance coverage

Chicago city council will likely start addressing concerns about rideshare services and may begin regulating certain aspects of the industry.
Chicago city council will likely start addressing concerns about rideshare services and may begin regulating certain aspects of the industry.
Photo by Scott Olson/Getty Images

The city of Chicago has begun addressing concerns about ridesharing services this week by subpoenaing Uber X, Lyft and Sidecar for information on insurance coverage for their drivers.

Rideshare companies, which enable users to request rides on their smartphones from nearby drivers, have faced pressure from the city in recent months over how rideshare programs should be regulated. The services contend they fall outside the same regulations as taxicab services because they act only as a way to connect riders and drivers.

While critics have questioned whether riders are protected by insurance in the event of an accident, Uber and Lyft have taken steps to protect their drivers by announcing insurance coverage for their drivers. The policy change comes after the city's request for insurance information, as well as in response to a fatal accident involving an Uber X driver in San Francisco.

But critics still question how coverage would function in the event of an accident, as many auto insurance policies do not cover commercial activity. The policies announced by Uber and Lyft would likely supplement a driver’s policy, being used only if a claim has been filed and exhausted on a driver’s individual insurance. The insurance would also cover incidents involving drivers in-between rides, which was the case for the accident in San Francisco.

Local taxicab companies have also been critical of the rideshare programs. Taxicab companies contend that rideshare services act within their industry but outside the same regulations, with rideshare services not needing $300,000 medallions to operate. The Chicago Dispatcher, a taxicab trade newspaper, published an editorial earlier this month threatening to expose five "secretly gay" aldermen if city council didn't ban ridesharing services by next month.

The city council in recent months has begun drafting a proposal that would require drivers to have a background check, training and an inspection of their vehicles. Some drivers have already encountered problems with local police and taxi administrators classifying the services as a public passenger service and therefore operating illegally, including a local reddit user driving for Lyft who had his car impounded and received a citation.

The city will undoubtedly address these and other questions within the coming months, and rideshare services will likely have to take steps to appease city council and protect its riders and drivers.

Report this ad