SAN FRANCISCO (REUTERS) - UberX on Friday expanded the insurance coverage it offers to ridesharing drivers, a step toward easing US regulators' and lawmakers' concerns and creating broader acceptance of the services.
Ridesharing companies such as UberX, part of black-car service Uber, allow members of the public to hail rides at the touch of a smartphone app. Mom-and-pop drivers rather than professionals typically answer their requests, in regular cars rather than commercial vehicles.
Until now, ridesharing companies' policies kick in only when a driver is giving a ride or en route to pick up a fare. That left drivers exposed when they were between rides in what has become known as the ridesharing insurance gap.
UberX's new policy is designed to make drivers more comfortable, along with regulators and lawmakers, many of whom are currently working through rules that would apply to ridesharing companies, Uber Chief Executive Travis Kalanick said on a conference call with reporters.
"That allows them to be thoughtful as they work through the legislative options," he said.
Rival ridesharing companies Lyft said it will soon start providing additional protection to drivers when they are between rides, while Sidecar said it also plans to roll out similar coverage.
The issue of the between-rides insurance gap came to public attention after a high-profile accident on New Year's Eve resulting in the death of a young girl. The driver involved, who crashed into her and her family at a San Francisco crosswalk, was between rides for UberX at the time.
Kalanick said the New Year's Eve case did not fall into the gap because the driver's insurance company has offered to pay up to the limits of the driver's policy for that accident. He could not remember what those limits were, he said.
UberX's new policy, which comes into effect only if a driver's personal policy does not cover an accident incurred during a gap between rides, provides up to US$50,000 (S$63,200) in coverage per individual for bodily injury, per incident, capped at US$100,000 total for the incident for bodily injury, plus US$25,000 per incident for property damage.
Taxi companies say ridesharing transportation lacks the safeguards they provide and makes for unfair competition.