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Auto Insurance Loophole Leaves Innocent Drivers Paying for Damages

auto insurance loopholeDue to an auto insurance loophole, a completely innocent driver may be liable for damages caused by the at-fault driver after an accident. This was the case for a York County woman who was involved in an accident with a DoorDash delivery driver in April of this year. Despite the delivery driver pleading guilty to disregarding a traffic lane, the woman still had to pay her $500 deductible with her insurance company. 

After reaching out to the other driver’s insurance company, Root Insurance, as well as the company the driver worked for, DoorDash, she was told both times that they were not responsible for any payment related to the car accident. It turns out that when drivers are ‘for hire’ for another service, their own personal auto insurance coverage does not cover them. This means that individuals driving around for delivery services such as DoorDash do not realize that they are not covered within that period of time. If involved in an accident, this puts innocent drivers at risk of having to pay out of pocket to cover damages.

On the company site, DoorDash does offer excess auto insurance for its drivers, but only after going through your insurance company first. This gray area has been a problem for many years.

Scott Cooper, a partner at Schmidt Kramer who focuses on car accident and insurance cases, shared his thoughts in an interview with FOX43 Finds Out. Cooper says that insurance companies have been using this loophole for decades to go around the minimum insurance requirements in order to avoid having to pay out on claims. Insurers are only looking out for their best interests and will do anything to save money.

When driving for a delivery service, there are exclusions in personal car insurance policies that are often overlooked for one reason or another. Depending on the circumstances, Cooper believes that drivers looking to earn extra money should look into having a broader policy that will continue to cover them once they clock in. Being informed about what your insurance policy covers is the best course of action until new legislation is enacted.

In 2016, the state of Pennsylvania passed a bill to help regulate ride-share companies, like Uber, requiring drivers to obtain insurance that recognizes that they drive for a ride-sharing company. This helped close a loophole that allowed insurance companies to potentially deny insurance coverage if innocent passengers were injured in an accident. 

Despite these efforts, more needs done to make sure that proper insurance requirements are in place for other customer-oriented services.

Do You Have the Right Coverage to File a Claim?

In some cases, even if you are covered by the proper type of auto insurance, your insurance company may still deny your claim after an accident. This is why it is important to contact an experienced Harrisburg car accident lawyer at Schmidt Kramer for legal help. We can review the details of your insurance policy and determine if there is enough coverage available to compensate you for your injuries. Unlike insurance companies, we always have your best interests in mind.

Schedule a free consultation with our firm today. There are no upfront fees for our services unless we recover compensation on your behalf.

Call us now at (717) 888-8888 or fill out our Free Case Review form.