Who Is Liable in a Ridesharing Car Accident?

Ridesharing has become a vastly popular service in recent years. Serving those who wish to arrange transportation on short notice and prefer not to use a traditional taxi service, companies such as Uber and Lyft give you the opportunity to book a ride by using a relevant app on your smartphone. Passengers use an app to choose their pick-up location and destination and travel in a private vehicle driven by its owner.

With the increase of vehicles used for ridesharing, it is inevitable that a corresponding number of car accidents also occur in this context. A study carried out by the University of Chicago has shown that the advent of ridesharing appears to have led to a 2-3% increase in motor vehicle fatalities and fatal accidents [1].

Ridesharing Car Accident and Liability

Given the particular circumstances under which ridesharing companies, also known as transportation network companies (TNCs), operate, determining liability in a ridesharing car accident can be challenging.

Drivers involved in ridesharing actually spend a long time on the road. This includes downtime between rides with clients as well as the time it takes them to get back to their driving zone after a fare, which is commonly referred to as “deadheading.”

According to an article published in the Denver Post, research conducted in the Denver, Colorado region suggests that drivers contracted by Uber and Lyft were “deadheading,” or driving around without a paying passenger, at least 40% of the time [2].

At the same time, it must be noted that this study—as is often the case with similar projects—did not take into account non-fatal accidents, in which injuries are much more common.

Even though it is not entirely clear how many accidents involving injuries occur in the context of ridesharing, data issued by the National Safety Council indicates that approximately 4.8 million people were seriously injured in automobile collisions in 2020 alone [3].

If you or a loved one was involved in a ridesharing car accident, you must have proper support and guidance in terms of establishing liability, as you may be able to receive compensation for your injuries. To do so, you must first correctly determine the at-fault party that should be held liable for the damages (economic and/or non-economic) that you sustained.

Given the special nature of ridesharing, getting professional advice from a lawyer with experience in such cases can be crucial, as there are a number of factors that need to be taken into consideration.

Our team at Legal Help in Colorado can support you along each step of the process, and we are committed to doing so for all injury victims, following a contingency fee arrangement—which means you can focus on your healing and rest assured that you will not owe us any fees until you receive your compensation payment.

Factors Affecting Liability in Ridesharing Car Accidents

In addition to promoting convenience, innovation, and economic growth, the new business model followed by TNCs also introduced a number of challenges to the existing legal, regulatory, and insurance frameworks that were already in place and related to more traditional means of transportation.

Hence, when it comes to determining duties and obligations, as well as managing situations such as accidents occurring in the context of ridesharing, a lot was required in terms of regulating this sector—and this is still very much a work in progress.

More specifically, when determining liability for a ridesharing accident, it is of paramount importance to consider the following three questions:

  • Was it the rideshare driver who caused the accident?
  • Was the rideshare driver actively using the ridesharing app when they got into the accident?
  • Were there other parties involved in or contributed to the cause of the accident?

Right from the outset, it is obvious that the answers to these three questions are complicated. Accordingly, employing the services of a seasoned injury lawyer can be decisive in terms of figuring out, collecting all necessary proof, and putting forward and supporting your claim as to whether it was the at-fault driver, their employer, or perhaps even a third party who is fully (or partly) liable for the damages you incurred in a ridesharing accident.

In practical terms, you will first need to determine:

  • First, that the accident was, in fact, caused by the rideshare driver.
  • If this is the case, it will then be necessary to establish whether the driver was working at that time.
  • If the answer is ‘yes,’ the specific details of this will also have to be investigated, as the precise status at the time of the accident will be decisive in terms of establishing liability.

As a final step, it will be vital to specify whether the driver was using the ridesharing app at the time of the accident. Had they logged on to the app to begin working and was it being used at the time or was it off? Was the app on with the driver waiting for the next ride request or were they on the way to pick up a passenger or actively giving them a ride?

Insurance Issues

Generally speaking, all automobile owners in Colorado must carry liability insurance to cover bodily injury caused to another person or property damage to their vehicle or property, when the insured is at fault for an accident.

In response to the rise in the popularity of TNCs, Colorado was one of the first states in the U.S. to put in place a specific statutory scheme for their operation back in 2014. The main provisions can be found in the Colorado Revised Statutes Section § 40-10.1-604, which sets out the financial responsibilities of TNCs and their drivers in our state, along with their insurance obligations [3].

The law sets out specific minimum coverages that owners must purchase, which are currently set at $25,000 for bodily injury or death to any one person in an accident; $50,000 for bodily injury or death to all persons in any one accident; and $15,000 for property damage in any one accident [4].

Different insurance coverage policies apply depending on whether an accident occurs when a ridesharing company driver has a passenger onboard, is waiting to get a fare or is returning from a fare, or is on their own time.

Thus, the Statute describes three distinct periods in which TNCs and/or drivers have varying insurance responsibilities:

  • The first one (“offline” period) relates to the time when drivers are not logged into the TNC app at all.
  • The second one concerns those periods when drivers have logged into the app but are not engaged in a prearranged ride (“in-app”).
  • The third one applies when drivers are engaged in a prearranged ride (“in-ride”).

Offline Period

If an accident occurs during the offline period, the rideshare company will not have liability for the damages caused by the driver. In such cases, victims who have suffered injury will have to look to the driver’s own auto insurance company for liability coverage, as if they were a non-commercial driver on the road.

In-App Period

When a driver has logged into the TNC’s digital network in anticipation of securing a prearranged ride for compensation (but has not accepted a ride), the Statute requires that either the driver or the TNC on behalf of the driver, secure a primary automobile insurance policy.

In other words, once drivers start engaging with the ridesharing company’s app, even though they have not received a ride request, the company starts to have some liability.

As a victim, you can turn to the driver’s personal auto insurance company first. If, however, their personal policy does not cover them, you may also be able to have the ridesharing company cover your accident, subject—of course—to certain policy limits.

Applicable Insurance Policies

Even though the responsibility to purchase the required insurance lies on either the driver or the TNC, TNCs have mandatory reporting and assurance obligations and can be fined. As a result, most of them seem to be purchasing in-ride insurance on behalf of the drivers. Furthermore, applicable legislation provides that TNCs must also provide uninsured motorist (UM) or underinsured motorist (UIM) coverage if an involved party is not sufficiently insured.

In addition, the TNC or driver must provide primary liability insurance coverage in the amount of at least $1,000,000 per occurrence, with the insurance policy providing coverage at all times the driver is engaged in a prearranged ride [5].

Third-Party Involvement

If you have been injured in the course of an accident involving ridesharing, it may also be the case that a third party was liable. If so, then you may pursue compensation from them on the basis of an insurance claim or personal injury lawsuit.

Some common examples of third-party liability in rideshare accidents, i.e. establishing liability with some other party other than the driver or the TNC, include:

  • Being hit by another driver.
  • Experiencing an accident due to vehicle malfunction caused by improper maintenance on the vehicle, in which case the maintenance company may be held to be liable.
  • Suffering injury resulting from a vehicle with a defective design, where the manufacturing company of the at-fault vehicle may be liable.
  • Holding a municipality accountable if it was hazardous road conditions that they had to address that led to the accident.


In any of the above cases, victims may be entitled to recover economic but also non-economic damages for the harm suffered, depending on the particular circumstances of each case.

Generally speaking, economic damages relate to objective, quantifiable monetary losses, which typically include medical costs, the cost of auto repairs, and lost income. Non-economic damages, on the other hand, are subjective, and mainly relate to pain and suffering and emotional distress.

The state of Colorado has applicable caps for damages related to non-economic damages, so it is vital that you are aware of your rights, back up your case as solidly as possible, and calculate your claim with precision.

What Happens in Real Life?

Real-life situations are not always simple. A close examination of the accident may be necessary to determine the driver’s status (and corresponding liability) accurately.

For example, TNC drivers heading home after their shift who have logged off the ridesharing app will be considered to have returned to private driver status (“offline”). So, they will normally be covered solely by their personal insurance.

Nevertheless, it is also possible that a driver who is returning home has kept the app active, in which case this may be seen as an “in-app” period where the contingent driver’s liability may be active.

In any event, should you or a loved one ever happen to be involved in a car accident where the other party’s vehicle has an Uber or Lyft sign or sticker on it, make sure to mention this to your lawyer.

Having an experienced lawyer who will be able to run a thorough investigation to determine liability and the best possible course of action so you can recover the compensation you deserve may prove to be invaluable. Here at Legal Help in Colorado, we work on a contingency fee basis, which means that you will not have to pay us any fees until you receive your payment.

If you have been injured in a car accident involving ridesharing, contact us today for a free consultation or call now (720) 664-9435, so we can discuss your case in absolute confidence.


[1] https://research.chicagobooth.edu/-/media/research/stigler/pdfs/workingpapers/27thecostofconvenience.pdf?la=en&hash=A15B1513F98D7A17B9E37F78DD2EBDC4C6338BFA

[2] https://www.denverpost.com/2019/03/13/lyft-uber-parking-impact-denver/

[3] As of 2022. Source: https://leg.colorado.gov/content/mandatory-automobile-insurance-colorado

[4] https://www.nsc.org/newsroom/motor-vehicle-deaths-2020-estimated-to-be-highest

[5] As of 2022. Source: https://codes.findlaw.com/co/title-40-utilities/co-rev-st-sect-40-10-1-604.html

[6] As of 2022. Source: https://codes.findlaw.com/co/title-40-utilities/co-rev-st-sect-40-10-1-604.html

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