One Accident with Lyft Flexdrive Destroyed This Driver’s Life

What drivers don’t know about insurance coverage when it comes to Uber and Lyft rental vehicles can have consequences – sometimes disastrous ones. The story below, as told to senior RSG contributor Paula Gibbins, is a “worst-case scenario” – but it can happen! Below, reader Elizabeth shares how an accident while using Lyft Flexdrive has changed her life. 

Quick Summary: 

  • Know what coverage you’re getting when you rent a vehicle for rideshare
  • Make sure you have rideshare coverage when driving your own vehicle
  • Take screenshots of conversations to help your lawyer if you need one in the event of an accident

April 16, 2021: This date is one that will live on in Elizabeth’s mind as the day that destroyed her life. She was driving around her area on her way to pick up a passenger (so period 2 by insurance standards) when another vehicle ran a red light.

“It was insane,” Elizabeth described. “It just happened so fast. Next thing I know people are helping me out of the vehicle, bringing blankets and water.”

Her chest hurt, so bad she almost couldn’t breathe, so an ambulance was called to the scene. Elizabeth was throwing up and in and out of consciousness. Upon arrival at the hospital, she was put into a brace so she couldn’t move and received x-rays, scans, and all types of tests.

The police came to her bedside to let her know the other driver confessed to it being their fault, not Elizabeth’s, and that the other woman was given a citation for it. Also, it was confirmed this woman had insurance.

That should have been the end of it: The person who was at fault got a citation and her insurance should have covered the accident. Right?

Limits of Insurance Coverage

With all of the tests, physical therapy, and the hospital stay, Elizabeth has about $44,000 in bills, in addition to the 28 days she was out of work.

The Rideshare Guy received copies of all of Elizabeth’s bills to confirm this story. While we’re not sharing all of the bills, this is the largest one Elizabeth received.

But the at-fault driver’s insurance could only pay out $25,000, the max amount they allow for the policy. And here’s why. Every state has different insurance requirements; Arizona’s minimum mandatory levels of financial responsibility are:

  • $25,000 bodily injury liability for one person and $50,000 for two or more persons
  • $15,000 property damage liability

The problem is that’s not nearly enough to cover everything that happened in this situation.

Since Elizabeth had been renting her vehicle through Lyft’s Flexdrive program and therefore paying for insurance for use of that vehicle, she figured she could get the rest from their end.

Lyft has insurance through Liberty Mutual and Allstate in her state of Arizona. Which one is used depends on the situation. So, to be on the safe side, she contacted both.

Problems Arise with Lyft’s Flexdrive Insurance Coverage 

Both insurance companies told Elizabeth that Lyft does not cover (Underinsured Motorist) UIM coverage.

“Lyft completely refused to help me,” said Elizabeth, so she started doing some research on Lyft and their Flexdrive program.

She wrote to me and stated, “Lyft and Flexdrive policies both state that they provide their drivers with Uninsured Motorist (UM) and UIM Insurance to avoid situations such as the one I find myself in. Sadly, this is not true. 

Lyft does not provide UIM insurance. Lyft does provide UM insurance. Therefore, considering I am not at fault, they will NOT cover any of my medical bills. If I was at fault, they would cover my bills up to a million dollars. How does this make any sense?”

Meanwhile, Elizabeth’s Lyft representative confirmed that if she had caused the accident, she’d have been eligible for a million dollars in coverage. Since she was not the responsible party, they wouldn’t give her a dime.

What Lyft probably meant was that they would have provided up to $1 million in liability coverage if she was at fault, meaning it would have paid for the other person’s damages, not for Elizabeth’s medical bills and lost wages.

However, the fact that they phrased it so poorly and refused to help in any way is just wrong. Especially if they claim to provide UIM insurance but don’t actually do that for their Flexdrive drivers in Arizona.

In fact, they even charged her $450 for damages, stating she’d be reimbursed for it by the at-fault driver’s insurance.

Communication with her Lyft support representative Josh

Elizabeth has also tried to get answers from Lyft support by other means and has gotten nothing but the runaround:

Multiple representatives said the exact same thing, but no one ever responded.

What’s Next?

For obvious reasons, Elizabeth decided to get a lawyer and start reaching out to local media outlets and publications like The Rideshare Guy.

As of the writing of this article, in 2022, 9 months after the incident, her lawyer has not been able to get ahold of anyone at Lyft to bring this to any kind of conclusion.

Meanwhile, Elizabeth, in her words, has “lost everything”. And she’s in real danger of losing her home. “The hospital says they need payment,” said Elizabeth. “I don’t have any more money.”

She’s grateful for what the hospital has done for her and her recovery, but they still want payment, which Elizabeth doesn’t have.

We reached out to Bryant Greening of LegalRideshare about Elizabeth’s predicament, and he stated that many drivers aren’t aware of the insurance limitations Uber and Lyft have – which can cost the drivers tremendously:

Uber and Lyft do a terrible job of educating drivers about the limitations of their insurance policies. People sign up for the rideshare platforms believing they will be fully covered if injured on the job. Unfortunately, many drivers learn the hard way that’s not always the case.  

The companies have to be more transparent — before an accident occurs — about what their policies cover and what they do not. Honest communication, from the start, would help drivers understand the risks of gig work and give them the opportunity to purchase better insurance policies, should they choose to do so.”

Edward Walker, Gig Economy Practice Leader, also notes that just because coverage is technically state-compliant does not mean it’s best for every scenario. As Walker commented:

Elizabeth’s situation is an upsetting reminder of the real gaps in coverage present throughout the ridesharing environment today.  While most TNC/Rideshare Rental operators purchase liability coverage for their drivers/renters at recommended limits, more often than not, ancillary coverages such as Underinsured/Uninsured Motorists’ are routinely rejected (where allowed by law) or purchased at state minimums.  Just because coverage is state compliant, does not necessarily mean it is a fit for every scenario.

If you are considering driving for gig work in any capacity, it is imperative to discuss protecting yourself with a licensed ridesharing insurance professional. 

At the driver level, an increased emphasis must be placed on designing your insurance coverage around what you’re going to be doing with your vehicle.  Far too often, drivers assume that they are covered for any accidents because “they’re insured”.  Without building your coverage around HOW you’re going to be using your vehicle (whether rented or owned), you are facing potentially serious financial risks.”

Optimism for the Future

“Honestly, I would like for them [Lyft] to take responsibility for reporting false information. Change their policy. If they are not going to cover UIM, they need to inform their drivers,” said Elizabeth.

She just wants to raise awareness of this for other drivers to learn from her. Of course, she would love for Lyft to cover her medical expenses as well, but the more important part is to prevent this from happening to somebody else.

Readers, did you know you might not be fully covered when renting out a car to drive for rideshare?

-Paula @ RSG