Getting into a wreck with an Uber or Lyft can leave people unsure of what comes next. The situation feels even more confusing when the driver has the app on but hasn’t yet accepted a ride. Research from the University of Chicago shows that the growth of rideshare services is linked to an increase in U.S. traffic fatalities, underscoring how these companies affect road safety.
This stage, known as Period One, puts accident victims in a tough spot. The driver is logged in and ready to accept trips, but there is no passenger in the car. Because the vehicle is being used for commercial purposes but isn’t officially on a trip, insurance companies often argue about who should pay. That leaves injured people caught between the driver’s personal auto policy and the rideshare company’s more limited contingent coverage.
Phases of Rideshare Insurance Coverage
Here’s how Uber and Lyft insurance changes depending on what the driver is doing:
- App Off: Personal driving. Only the driver’s auto policy applies.
- Period One (App On, No Passenger): The driver is available for rides. Uber and Lyft provide contingent third‑party liability coverage that applies only if the personal policy denies coverage. Typical limits are $50,000 per person, $100,000 per accident, and $25,000 property damage. Limits can vary by state.
Reference: Lyft’s insurance coverage.
- Periods Two and Three (Ride Accepted or Passenger in Vehicle): Once a ride is accepted, coverage increases to at least $1,000,000 in third‑party liability.
Reference: Uber’s insurance overview.
Extra protections like uninsured/underinsured motorist coverage may also apply depending on state rules.
The difference in coverage between periods is huge. A crash seconds before a driver accepts a trip might only have $50,000 available per injured person. That same crash seconds later, once a ride is accepted, could open access to $1 million. Proving exactly when the accident happened can make or break a case.
Proving Driver Distraction From the App
Many Uber and Lyft drivers are glued to their phones. They use the app to accept requests, get directions, and communicate with riders. But multitasking behind the wheel is dangerous. According to NHTSA, 8% of fatal crashes in 2023 were caused by distraction, leading to 3,275 deaths.
Evidence of distraction might include:
- App usage logs
- Cell phone records
- Witness statements
- Expert analysis of phone activity
It’s not just the rideshare app that causes problems. Many drivers juggle text messages, navigation, and music apps all at once. Courts have become more willing to look at electronic records as proof, and lawyers often bring in experts to interpret the data. A skilled rideshare accident lawyer can make sure this evidence is preserved and presented effectively.
Subrogation Between Personal and Rideshare Insurers
Period One claims often spark disputes between insurers. The driver’s personal insurer may say the accident was business‑related and refuse to pay. Uber or Lyft’s insurer may argue that the personal policy should pay first. This finger‑pointing is called subrogation.
While insurers argue, bills pile up. Some companies issue partial payments but reserve the right to get reimbursed later. Without an advocate, victims can end up waiting months. Having an attorney helps keep the process moving so victims aren’t left paying out of pocket.
Independent Contractor Versus Employee
Uber and Lyft treat drivers as independent contractors. In California, voters passed Proposition 22, and the California Supreme Court upheld it in 2024. That means most drivers in California remain independent contractors, with only limited benefits.
The classification issue matters because if drivers were employees, the companies could be held directly responsible for accidents. For victims, this would often mean easier access to corporate insurance policies with higher limits. Until laws change more broadly, classification will continue to shape how liability is argued in court.
Time Limits for Notifying Uber or Lyft
Accidents should be reported through the Uber or Lyft app right away. Waiting too long can complicate claims. State law also sets hard deadlines for lawsuits:
- Alabama: 2 years for most personal injury claims (Ala. Code § 6-2-38).
- Tennessee: 1 year for most personal injury claims (Tenn. Code § 28-3-104).
Insurers often ask for detailed timelines. A delay in reporting can be used against the victim, so it’s best to act fast.
What To Do After a Rideshare Accident
- Call 911 and get medical help.
- File a police report.
- Take photos of vehicles, injuries, road conditions, and the app showing online status.
- Report the crash in the app. See Uber’s Crash Guide.
- Talk to a rideshare accident lawyer before giving statements to insurers.
Keeping a recovery journal, writing down symptoms, treatment, and how injuries affect daily life, can also be powerful evidence when it comes to proving damages.
Understanding Uber Driver Liability in Period One
Liability in these accidents boils down to negligence. If a driver waiting for a ride causes a crash, the personal policy is usually looked at first. If that policy denies coverage, Uber or Lyft’s contingent coverage can apply up to the Period One limits. For serious injuries, multiple policies may need to be combined, including your own uninsured or underinsured motorist coverage.
Victims should also think beyond just the driver and rideshare company. Other parties—like another careless driver, a car manufacturer, or even a city responsible for dangerous road conditions—might share fault. An experienced lawyer will explore every option to maximize compensation.
FAQs
Who pays if an online Uber or Lyft driver hits me while waiting for a ride?
The driver’s personal insurer is first in line. If denied, Uber or Lyft’s Period One liability coverage applies up to $50,000 per person, $100,000 per accident, and $25,000 property damage.
Does Uber or Lyft cover medical bills in Period One?
Coverage is third‑party liability and may not fully cover medical bills. Additional recovery may come from the driver’s personal policy or your own MedPay, PIP, or UM/UIM.
What if the driver was distracted by the app?
Phone and app records can prove distraction. Screenshots and ride receipts also help.
How long do I have to file a claim?
Deadlines differ. Alabama gives 2 years and Tennessee 1 year for most personal injury claims. Other states may vary.
Can I sue Uber or Lyft directly?
It’s difficult because drivers are independent contractors, but exceptions exist if there’s evidence of company negligence in hiring, training, or technology.
What compensation can I recover?
You may be able to recover medical costs, lost income, pain and suffering, and property damage. In extreme cases, punitive damages may be possible.
Key Takeaways
- Period One coverage is limited: usually $50,000 per person, $100,000 per accident, $25,000 property damage.
- Coverage increases to $1,000,000 once a ride is accepted.
- Distraction is a major risk: in 2023, 8% of fatal crashes involved distraction (NHTSA).
- Driver classification shapes liability: California upheld Prop 22, while other states may differ.
- Act quickly: report accidents right away and pay attention to state deadlines.
- Strong legal strategy matters: the right approach can open more sources of compensation.
Cory Watson Attorneys has decades of experience helping people after taxi and rideshare accidents. If you were hurt in an Uber or Lyft crash, we’re here to guide you every step of the way.