Rideshare companies such as Uber and Lyft have grown into a popular mode of transportation. Whether you need a ride home after drinking all night or to the airport, you could simply request a ride through your cell phone for any occasion at any time—sometimes at a cheaper rate than taxi services.
However, these vehicles are also susceptible to car accidents, injuries, and fatalities. Since rideshare drivers are ordinary citizens and do not require any type of special license to operate their own vehicles, are they eligible for workers’ compensation benefits in the event of an injury on the job?
The answer is technically no.
Uber Drivers are Considered Independent Contractors
Uber and other rideshare companies do not view their drivers as employees, but rather independent contractors. This means they are not entitled to benefits often given employees, such as overtime pay, paid sick days, healthcare coverage, and even workers’ compensation.
While being an independent contractor enables Uber drivers to determine their own work schedule and select which customers to pick up, this type of worker is not entitled to protections which regular employees have. In the event of a car accident resulting in an injury, they could seek damages from the at-fault party’s insurance company if an Uber driver is not responsible for an accident.
Uber Offers Driver Injury Protection
No matter who is liable for a car accident involving a rideshare driver, Uber offers an insurance program known as Driver Injury Protection, instead of workers’ compensation. Offered via Aon P.L.C. and OneBeacon Accident & Health, this insurance program is available in 40 states.
If an Uber driver gets injured while using the app—whether he/she is logged on to accept rides or transporting a passenger—the coverage would provide up to $1 million for medical bills and up to $500 per week in earnings replacement. If an Uber driver passes away as a result of a collision while working, his/her family could receive up to $150,000 in survivor benefits.
This coverage is designed to be cost-neutral to the driver. The program costs drivers 3.5 cents per mile, but the company raised its fares by five cents per mile. In general, Uber retains approximately 25 percent of the fares drivers collect, which means drivers will receive an extra 3.75 cents per mile to pay for the insurance coverage.