100,000 Uninsured Rides and Counting: Undercover at Lyft and Sidecar

Lyft (photo shows phone salespeople recruiting drivers at Lyft headquarters) and Sidecar are venture capital startups that advertise themselves as car-pooling services that use smart-phone apps to connect people who need rides with drivers in the community “who have extra space in their cars.”

Both companies claim to do intensive evaluations of drivers, including criminal background checks and thorough inspections of the vehicles that provide transportation services through their apps. They also tell their drivers that their cars "do not need to be covered by commercial liability insurance.”

I decided to check out their hype because I’m the ideal person to do so. I’ve been an insurance underwriter, a driving instructor, a blogger, and I’ve logged over a million miles as a cab driver. My research included talking to representatives from the top ten rated insurance companies, interviewing people who have been Lyft or Sidecar drivers or customers, and applying for a driving position at the two companies. Both Lyft and Sidecar initially approved me but later changed their minds when I started asking them detailed questions about their contracts and insurance.

What I learned was that almost every claim that they make is either misleading or false. Their interviewing process is a joke. They don’t ask for social security numbers and they don’t fingerprint the applicants so they can’t be conducting criminal background checks. Nor do these companies make mechanical inspections of the cars. In the case of Sidecar, they don’t even look at the vehicle. Most importantly, insurance companies consider neither Lyft"s or Sidecar's ridesharing services so their cars are required to carry commercial insurance. Since most of their cars don’t, they are uninsured vehicles.

In reality then, Lyft and Sidecar are illegal transportation for hire services that use double-talk to exploit the underemployed, and subvert laws and regulations designed to protect drivers, passengers and the public. Furthermore, when drivers and passengers accept the terms of service necessary to download their apps, they waive their rights to sue Lyft or Sidecar in perpetuity. Their passengers also agree to come to the legal defense (at their own expense) of Lyft or sidecar if the companies are sued for negligence.

If you were to be a car, what kind of car would you be and why?

I've had many careers in my life but my interviews at these companies marked the first times that I've ever applied for a job and not been asked what skills or experience qualified me to do the work.

Sidecar conducted an online video interview with me. The most profound question they asked was:

If you were to be a car, what kind of car would you be? And why?”

The other Sidecar questions were:

“Who are you and why would you make an awesome Sidecar community driver?” 

“Where are some of your favorite places to hang out and why?”

“How did you hear about us?”

During a phone interview, Lyft representative Chris did ask me if I’d ever had a DUI or a criminal record. He then returned to in-depth community ridesharing form to finish up with:

“How would your friends describe your personality?”

“Do you smoke in your car?”

“For a more important question, who would you most want to ride in your car for ten minutes?”

Both companies did check to see if my driver’s license was valid and my auto insurance was up to date. They also looked at my vehicle ownership card. Neither company fingerprinted me or asked for my social security number - necessities for doing a criminal background check.

I had an “in person” interview at Lyft that lasted three minutes. There was no training session. An interviewer/inspector, who looked more like a fashionista then a mechanic, glanced at my car. She sat in the front seat to see if it was clean and made sure that the lights and turn signals worked before taking my photograph standing next to the car. She did not drive the car or ride in it, check the tires, check the VIN #, open the hood, look under the car or do any kind of mechanical inspection.

There was no “in person” interview at Sidecar. Instead, I attended Sidecar U for an hour and a half where most of the time was devoted to explaining how to use the app and noting the best times to drive. The fact that Sidecar was not liable for auto insurance was briefly mentioned and driving safely was encouraged. The instructor proudly told us that Sidecar now had over five hundred vehicles in San Francisco.

I was told to upload a photo (left) of my car to their website where they must have done the mechanical inspection because they certainly didn’t do so in person.

On the basis of these intensive interviews, I was approved along with three other divers at Lyft and with eighteen others at Sidecar.

Next: If it looks like a duck and walks like a duck, will it bark if you call it a dog?  The art of double-talk and a look at Lyft's and Sidecar's insurance, or lack thereof.