Published May 12, 2017|3 min read
Customers are helping foot the bill for a new setup that will extend personal injury insurance to drivers for Uber.On May 9, Uber hiked rates by 5 cents a mile to pay for a pilot program that will offer drivers the chance to purchase the optional coverage, according to media reports. The program affects riders and drivers in eight states: Arizona, Delaware, Illinois, Massachusetts, Oklahoma, Pennsylvania, South Carolina and West Virginia.Under the new program, Uber is letting drivers decide whether to keep the extra money or put it toward the insurance, according to BuzzFeed News. If drivers opt for the coverage, it’ll cost them 3.75 cents per mile.Because Uber drivers are contractors, rather than employees, they’re not eligible for workers’ compensation insurance, which would cover on-the-job injuries. In the same way that Uber drivers now have a number of car insurance options, they can now also protect themselves from personal injury.Two insurance companies, Aon and OneBeacon, will provide the Uber insurance policies. The coverage will pay as much as $1 million for medical expenses, up to half an Uber driver’s average weekly earnings, and a maximum of $150,000 in survivor benefits, BuzzFeed News says.The coverage kicks in while drivers are logged in to the Uber app, either when they’re ready to pick up passengers or they’re actually in the midst of a trip, PennLive.com reported."We believe drivers should have a low-cost option to protect themselves and their families against rare and unforeseen accidents that prevent them from working," Gus Fuldner, Uber’s head of safety and insurance, told PennLive.com.Fuldner says Uber is not making money off the arrangement.Harry Campbell, owner and founder of The Rideshare Guy, a blog and podcast targeted at drivers for ride-hailing services like Uber, says he doesn’t think Uber customers will notice the rate hike.As for Uber contractors, Campbell says the new insurance offering won’t be "a huge deal" for part-time drivers, but it will greatly benefit many full-time drivers who rely on Uber for most or all of their income."I think this pilot is definitely a step in the right direction," Campbell tells PolicyGenius. "It’s nice that Uber actually raised rates by 5 cents to cover the cost of the benefit, since even those who don’t end up taking advantage of the program will at least get a small raise."Critics complain it’s a step in the wrong direction.In an email, Rebecca Smith, deputy director of the pro-worker National Employment Law Project, says the Uber insurance program is merely an attempt by the ride-hailing service "to shore up its faltering image," according to BuzzFeed News."Instead of paying workers’ compensation premiums to cover all of its workers, as responsible businesses do, Uber will charge drivers for the medical care and time-loss benefits that the rest of us get by virtue of working at a job," Smith says. "What will it take for Uber to stop the end-runs and other shenanigans and finally act like a responsible employer? If Uber valued its workers, it would simply pay its workers’ compensation premiums and cover all of them."Campbell says he isn’t sure whether the insurance program was created in reaction to the hit that Uber’s public image has taken recently as reports surface about corporate controversies."But there’s no doubt that Uber can do a lot to repair its relationship with drivers," he says. "This isn’t going to change the perception overnight, but it’s definitely a step in the right direction."
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