Getting into an accident with a rideshare vehicle can raise a lot of questions, but things can get more difficult when the at-fault driver files for bankruptcy. Whether you were a passenger or another driver injured by the impact, you may wonder how this can affect your ability to recover full compensation. The answer? You still have legal options available, but understanding how bankruptcy overlaps with insurance coverage and rideshare accident claims is crucial to protecting your rights. 

Understanding Rideshare Insurance Coverage

Before uncovering bankruptcy issues, it is important to know Uber and Lyft insurance policies. Both companies provide these to help cover accidents during active rideshare periods. This coverage is categorized into the following stages:

• App Off: Only the driver’s personal auto insurance policy will apply
• App On, No Ride Accepted: Uber or Lyft will provide limited liability coverage ($50,000 per individual/$100,000 per accident for bodily harm/$25,000 for property damage)
• Ride Accepted or En Route to Pick Up or Drop Off: $1 million in liability coverage will be provided

So, if you were a passenger in the vehicle or were struck by a rideshare driver while they were actively on the job, you may be covered by this commercial policy. 

What if the Uber or Lyft Driver Files for Bankruptcy? 

If the rideshare driver involved in the accident declares bankruptcy, it does not necessarily mean that your claim will be voided. 

Uber and Lyft’s insurance policies are separate from the driver’s personal assets. This means that even if they file for bankruptcy, the commercial insurance coverage will remain effective. You are still entitled to file a claim against that policy if you sustained any injuries or damages during a covered period. 

Now, if your losses exceed what the insurance offers, or if you are met with a dispute, you may have to file a lawsuit. This is where bankruptcy will get involved. In this case, an “automatic stay” will go into effect, which temporarily pauses lawsuits and collection efforts against the debtor. 

But, rideshare accident victims can request the bankruptcy court for permission to pursue their lawsuit. Judges may grant this, specifically if the claim is made with the intent to recover from an insurance policy rather than a driver’s personal assets. 

Depending on the bankruptcy type and the court’s decision, your claim may either be:

• Discharged (debt is wiped out)
• Partially repaid (if the driver is under a payment plan)
• Excluded from the discharge 

It is also important to note that you should not overlook potential third-party liability. Certain factors, like poor vehicle maintenance or faulty parts could have played a role in the Uber or Lyft accident. Exploring every possible source of compensation is crucial, especially if the at-fault party’s finances are off limits because of bankruptcy. 

What Should You Do if This Happens?

If you discover that the rideshare driver has filed for bankruptcy in the aftermath of the collision, you should consider implementing the following steps.

File a Claim with Uber or Lyft Insurance

Be sure to file a claim with Uber or Lyft insurance as soon as possible. This will be your best bet to acquire compensation. 

Consult with a Rideshare Accident Attorney

Handling bankruptcy law and personal injury claims on your own can be challenging. A rideshare accident attorney can help you petition to the court to lift the stay or figure out whether your claim may qualify as non-dischargeable. 

Gather Documentation

Be sure to acquire copies of important documentation, like police reports, medical bills, and any form of communication you had with Uber or Lyft. 

Keep an Eye out for Deadlines 

Personal injury cases and bankruptcy proceedings involve strict time limits. Missing a deadline to submit crucial information can weaken your chances of receiving fair compensation.

Bankruptcy Complicating Your Accident Claim? Let West Coast Uber and Lyft Accident Lawyers Guide You

When an Uber or Lyft driver files bankruptcy soon after an accident, you may feel like your claim has reached a dead end. But, that is not always the case. You can still recover damages through insurance, even if the driver’s personal finances are out of reach. 

At West Coast Uber and Lyft Accident Lawyers, our team understands how complicated this type of situation can be. We can help you:

• Understand how bankruptcy may impact your rights
• Guide you through complex insurance claims
• Petition the court if needed to have your case proceed 
• Look into other potential sources of financial recovery

Our knowledgeable rideshare accident attorneys will give you clear answers, and will develop an effective strategy with your needs and priorities in mind to ensure we deliver satisfactory results. To get started with the legal process, set up a FREE consultation by calling us at (213) 465-8682 or completing our quick online contact form.