Most people involved in a rideshare crash assume the same thing: Uber or Lyft has a million-dollar policy, so the bills will get covered. Then the phone calls start. One adjuster says the driver’s personal insurance needs to respond first. Another says coverage depends on the exact moment the crash happened. A third says your own policy might need to step in. What felt like a straightforward situation becomes a layered dispute between multiple insurers, each pointing somewhere else.
The confusion isn’t accidental. Rideshare insurance is structured in phases, and which policy applies and for how much depends on a specific factual question: what was the driver doing in the app at the moment of impact. Getting that answer wrong can mean leaving significant compensation on the table. Our attorneys at Mayerson Injury Law, P.C. have focused on personal injury claims since 1963, and rideshare crashes are among the more complex insurance situations we work through with clients in Montgomery County.
Call (610) 492-7155 today or reach out online to schedule your free, confidential consultation with our dedicated Pennsylvania rideshare accident lawyer.
Here’s how the coverage actually works.
How Pennsylvania’s Rideshare Insurance Phases Work
Pennsylvania’s framework for rideshare insurance comes from Act 164 of 2016, which established rules for transportation network companies (TNCs), the legal category that includes Uber and Lyft. Outside of Philadelphia, where the Philadelphia Parking Authority has its own oversight role, TNC service is regulated by the Pennsylvania Public Utility Commission (PUC). Every rideshare trip in Montgomery County falls under PUC-administered rules, not the Philadelphia framework some articles describe.
Act 164 divides every rideshare trip into three phases, each carrying a different coverage requirement.
The phases and their minimum coverage requirements:
- App off (Phase 0): Act 164 doesn’t apply at all. Only the driver’s personal auto policy responds, subject to Pennsylvania’s baseline minimums of $15,000 per person, $30,000 per accident in bodily injury, and $5,000 in property damage.
- App on, waiting for a match (Phase 1): Act 164 requires at least $50,000 per person and $100,000 per accident in bodily injury, plus $25,000 in property damage. In practice, this coverage often functions as a backstop when the driver’s personal policy excludes commercial activity, which most personal policies do.
- Ride accepted through passenger drop-off (Phases 2 & 3): Act 164 requires at least $500,000 in primary liability coverage, and both Uber and Lyft voluntarily maintain $1 million in third-party liability, exceeding the statutory floor. This is the figure most people have heard about, and it applies once the driver has accepted a ride request or has a passenger in the vehicle.
Electronic app data from Uber or Lyft is typically the evidence used to establish which phase applied. Preserving that data, along with screenshots and GPS records, matters early in these cases.
The Gap Between Uber & Lyft Coverage That Actually Matters
Most articles describing rideshare insurance treat Uber and Lyft as interchangeable. They aren’t, and the difference can significantly affect what a crash victim can actually recover.
The key distinction involves uninsured/underinsured motorist (UM/UIM) coverage, the protection that compensates victims when the at-fault driver has no insurance or not enough of it. Act 164 doesn’t require TNCs to carry UM/UIM coverage, and both Uber and Lyft have taken advantage of that gap in Pennsylvania. As Uber’s own website acknowledges, it doesn’t maintain UM/UIM for rideshare in every state and only carries it where state law requires it. Lyft formally eliminated its UM/UIM coverage effective April 1, 2020. Because Pennsylvania law doesn’t require it, both decisions are entirely legal.
That creates a real coverage gap for rideshare passengers injured by an uninsured or underinsured driver. Recovery is largely limited to whatever the at-fault driver actually carries and whatever UM/UIM the passenger holds on their own personal auto policy. This is one of the more consequential facts to understand early: your own UM/UIM coverage may be the only meaningful source of additional compensation available.
Whose Insurance Pays First After the Crash
Pennsylvania operates under a no-fault insurance system for initial medical expenses. The injured person’s own first-party medical benefits, also called personal injury protection (PIP), pay initial medical bills first, regardless of who caused the crash. The state minimum for PIP is $5,000, though many policies carry more. You don’t wait for fault to be determined before your initial medical treatment gets covered.
After PIP responds, if a third-party driver caused the crash, their liability coverage is pursued. Because many Pennsylvania drivers carry only the state minimum liability limits, that coverage can be exhausted quickly in a serious injury case. The rideshare company’s Phase 1 or Phase 2 and 3 coverage then becomes the primary source of compensation, depending on what the driver was doing. A passenger’s personal UM/UIM coverage can also apply on top of whatever the rideshare company or at-fault driver provides. Identifying every potentially applicable policy (the driver’s personal policy, the rideshare company’s commercial coverage, the at-fault third party’s policy, and the passenger’s own coverage) is what separates a fully compensated claim from one that leaves money unreachable.
How Your Tort Election Affects a Rideshare Injury Claim
Pennsylvania auto insurance policies require every driver to choose between full tort and limited tort coverage. This choice, called a tort election, follows the policyholder into situations where they’re a passenger, not just behind the wheel.
Full tort preserves the right to sue for pain and suffering after any crash, regardless of injury severity. Limited tort restricts that right unless the injury meets the serious injury threshold defined under Pennsylvania law: serious impairment of a body function, permanent serious disfigurement, or death. Below that threshold, a limited tort policyholder can still recover medical expenses and lost wages, but not pain and suffering compensation.
Many Uber or Lyft passengers don’t realize their own tort election is relevant at all. Because they weren’t driving, they assume their policy doesn’t apply. But the tort election made when purchasing a personal auto insurance policy governs what an injured passenger can pursue in someone else’s vehicle. A serious but technically sub-threshold injury in a rideshare crash could significantly limit compensation for a limited tort policyholder in ways that don’t surface until the claim is already underway.
What This Means for Your Claim
The headline number ($1 million in liability coverage) is real, but it only tells part of the story. Whether it applies at all depends on the phase of the trip. Whether UM/UIM coverage is part of the picture depends on your own policy, because neither Uber nor Lyft is currently required to carry it in Pennsylvania, and neither reliably does. Whether you can recover for pain and suffering depends on the tort election you made on your own policy, potentially years before this crash happened. And whether your initial medical bills are covered depends on the no-fault PIP layer that most rideshare articles skip past entirely.
If you were hurt in a rideshare crash in Montgomery County, we offer free consultations and can come to you at home or in the hospital if you can’t travel. Reach out at (610) 492-7155 to go through which policies apply to your specific situation.