Updated: Paragraph 2: Lyft says its excess policy kicks in even if a driver's insurance doesn't support for-profit ride-sharing.
Updated: Paragraph 4: Clarification on Uber charter carriers versus rideshare services.
Ever since Uber and its various rideshare competitors began disrupting the taxi industry in 2009, cabbies and SFMTA officials have argued, often stridently, that drivers for these car-hire startups don't have adequate insurance. Although the CPUC granted the startups a temporary reprieve and green-lighted their million-dollar excess liability policies while it drafts new rules on ridesharing, opponents said that wouldn't hold up if and when there's a major accident.
Luxor Cab's general manager Charles Rathbone pointed out, repeatedly, that excess policies won't even kick in unless a driver's personal insurance policy supports for-hire use of a vehicle -- and most don't. A Lyft spokeswoman took exception, saying the rideshare policies approved by the CPUC kick in even if the driver's insurance does not support for-profit ridesharing.
"And therein lies the problem," he wrote in an e-mail. "Unfortunately," Rathbone wrote in an e-mail, "it will take a tragedy to find out if Lyft actually has its passengers (or its drivers) insured for anything at all," he continued.
Theoretically the same would go for similar rideshare services UberX, SideCar, et. al. The problem is slightly different for Uber's contracted town car drivers, who are licensed with the CPUC. In their case, Uber claims no liability for accidents that happen when a driver is picking up a smartphone hail. It didn't capitalize the industry; it doesn't employee the drivers; it's not responsible when they screw up.
Rathbone and other skeptics stood by and waited for the other shoe to drop. And finally, on March 13, it did.
Shortly before midnight, black town car driver Djamol Gafurov hit a black Dodge Magnum while turning left onto Hayes Street from Divisadero, causing it to slam a fire hydrant, then a tree. The fire hydrant blew off the ground and struck bystander Claire Fahrbach, knocking her to the ground and fracturing her leg.
On July 26, Fahrbach sued Gafurov, who drove for SF Limo Car Service Corporation, as well as the Dodge driver Ziad Sleiman. She also sued Uber Technologies Inc., claiming that because Gafurov was using the Uber app to pick up passengers at the time of the accident, it, too, should be responsible for a share of the damages. Fahrbach is seeking compensation for medical bills, attorneys' fees, and loss of income after the accident, since the injuries prevented her from working.
In press statements, Uber has distanced itself from the suit, pointing to clauses in its terms of service that absolve it from any accidents caused by its drivers. Since Gafurov is a private contractor, rather than a company employee, he'll foot the
$500-$750K bill that could result from this accident using his CPUC-mandated $500-$750K insurance liability.
In this case, the driver had all of the required commercial licensing and insurance required for a transportation charter party in California, according to an Uber spokesman. "For these reasons," he said in an e-mail, "we believe that Uber acted appropriately in activating the driver and his business on the Uber technology platform."
Unfortunately, he added, technology platforms don't prevent accidents.
Read the full complaint: