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App-based Taxi Services: Who is Liable if an Accident Occurs?

With the rise in use of app-based taxi services, such as Uber and Lyft, gaining popularity as an alternative to the traditional yellow cab, and providing millions of rides a day worldwide, an interesting question is raised: what about their insurance policies? Who is liable if an accident occurs whether I am inside or outside the car? Do I sue the company, or the driver? Last year, major liability issues were raised when a young girl was killed after being hit by a driver operating a vehicle used for Uber purposes.

A recent BuzzFeed article exposed that the company Uber is suggesting that drivers purchase insurance that does not cover the "trolling period" when waiting for a new passenger and does not inform them that they need insurance for driving a commercial vehicle. Although it is not uncommon for traditional taxi cabs to get into accidents, liability is not at issue because drivers are insured by the company, whether a passenger is in the vehicle or not. Accidents are perhaps even more probable with app-based driving services which may cause distracted driving due to the nature of the app. There is concern that drivers run a risk of being preoccupied by constantly looking at their smart phones to be the first to accept the next fare.

Although these companies claim to have taken measures to change their policies, drivers have still complained of a number of blurry liability issues. Many drivers are unclear when the app is off, does it constitute the driver's own time, and what insurance should cover the trolling period. In many other instances, drivers lied to their insurance company about the commercial use of their vehicle, thus leaving themselves open to the possibility of lengthy litigation in the event of an accident.

If you have suffered from an injury due to an app-based taxi service accident either as a pedestrian or passenger, contact an experienced personal injury attorney at the Law Offices of Sakkas, Cahn & Weiss, LLP at (212) 571-7171.

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