Insurance concerns linger for drivers using services like Lyft.
Maryland is now the sixth state to issue a warning about popular ridesharing services that connect drivers to passengers through smartphone apps.
When you order a ride through Uber, Lyft, or Sidecar, a cab will pick you up, but these cabs are actually the drivers' own personal cars. The tech companies call them ridesharing services; regulators call them private sedans for hire. The drivers have insurance, but Vivian Laxton at the Maryland Insurance Administration says not the right kind.
"Well, Maryland's insurance commissioner Therese Goldsmith issued a notice to alert drivers in a common exclusion in most personal auto policies for claims that arise while driving for hire," Laxton says. "She suggested you consider whether a commercial auto policy is appropriate."
Uber, Lyft and Sidecar are running into trouble with insurance officials and regulators across the country who say the drivers, passengers, pedestrians, and other motorists may not be covered by the tech firms' umbrella or excess insurance plans that are supposed to "drop down" if the driver's insurance doesn't cover injuries and damage suffered in a crash.
Drivers who work for transportation network companies may not be covered by their personal automobile insurance policies.
Uber, Lyft and Sidecar say their insurance plans are better than what metered taxicabs are required to carry.