Car Service Apps In Legal Grey Area

Car Service Apps In Legal Grey Area

Over the past few years most Kentucky readers have probably noticed that they are using their smartphones for many things they never thought possible, whether that means using a digital boarding pass at the airport or video-chatting with a friend overseas. Increasingly, many people are using smartphone applications to set up transportation, using new programs like Uber, Sidecar, Lyft, and others to connect with commercial drivers or rideshare participants.

These applications are generally considered to be the wave of the future and are mostly hailed as positive innovations. However, a recent fatal car crash involving an Uber driver has raised questions about insurance and liability and legal oversight for these types of services.

State regulations on these types of car services differ, with few enacting specifically targeted laws since the business model is so new. They fall somewhere between a traditional taxi or private car service, since drivers are contracting on a by-the-ride basis, rather than working a certain shift during which they are under the auspices of the company. This matters when it comes to determining who is liable for accidents and injuries, since in order to assert liability on the car service company and not just the driver, there must have been a strong connection between an appropriate legal relationship between the driver and the company at the time. For a driver who is dropping in and out of service for the company, it can be hard to know when they were operating as on behalf of the company at the time of the crash and therefore whether liability is appropriate.

Source: Los Angeles Times, “California regulator warns about gaps in ride-sharing insurance,” Marc Lifsher and Salvador Rodriguez, Feb. 5, 2014.

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