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Ridesharing Programs Are Growing in Popularity: What Are the Pros and Cons?

Ridesharing used to mean carpooling or vanpooling, usually organized within a common workplace or destination. Today, however, formal ridesharing programs have revolutionized the transportation industry–and not without a little controversy. Here’s a look at this growing phenomenon in the United States and the potential pros and cons of the practice as it rapidly gains popularity.

What’s Not to Like About Ridesharing?

Ridesharing at its most basic really has no downsides. Participants save fuel, which preserves natural resources and air quality. Of course this saves money too, as drivers share the cost of gas, tolls, wear and tear on their vehicles and insurance (many plans cost less for fewer miles traveled per week). This can save the average participant thousands of dollars over the course of a year.

Sharing rides also reduces traffic and allows passengers to use the time spent not driving to read, sleep, send texts or emails–whatever they want. This has the added benefit of reducing the temptation some drivers might feel to utilize mobile devices while driving, which is both illegal in many cases and always dangerous.

What Are the New Ridesharing Programs About?

Today’s ridesharing programs have moved beyond traditional carpooling and offer something in between carpooling and taxi service. Officially called “transportation networks,” formal ridesharing businesses like Lyft, Sidecar and UberX use mobile phone apps to connect people with cars to people who need rides. The drivers are paid, while passengers ride for free or for a donation. Donation-based service is being phased out lately in lieu of venture capital-backed service.

Ridesharing programs allow drivers and passengers to rate each other, and these businesses tout the friendliness of their service. Some riders and passengers have even gone on to become friends. Drivers are screened for criminal backgrounds, and there is a zero tolerance policy in these programs for the use of drugs or alcohol. Vehicles are inspected for safety as well.

Why Are Ridesharing Programs Controversial?

The controversy with ridesharing programs is twofold. Taxi companies feel that ridesharing is in direct competition for the service they provide, while avoiding the stringent licensing and insurance requirements faced by taxi cabs. Some cities have attempted to cap the number of ridesharing cars on the streets at any one time, but this has proven largely unsuccessful.

Insurance is the second troublesome issue for ridesharing networks, and this has been the latest focus for government control. California, where transportation network companies first sprang up, was the first state to take legal action to legislate insurance coverage for ridesharing programs. Rideshare drivers in California now have three tiers of insurance they must carry, from the time they log in to a network, to getting a passenger request to actually transporting the passenger. Illinois has recently followed suit.

What other states or municipalities will do remains to be seen. Ridesharing is unforeseen new transportation territory, much like self-driving cars. While rules governing the operation of ridesharing programs may change, it certainly does not look like these transportation networks are going anywhere in the near future.

This article was written by Dixie Somers, a freelance writer who loves to write for business, finance, technology, and women’s interests. She lives in Arizona with her husband and three daughters. Dixie got her advice about controversial ride-sharing insurance issues from the Lindsay lawyers of Kitchen Simeson Belliveau LLP.

Photo credit: via Google Commons.


Bob Kraft

I am a Dallas, Texas lawyer who has had the privilege of helping thousands of clients since 1971 in the areas of Personal Injury law and Social Security Disability.

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The title of this blog reflects my attitude toward those government agencies and insurance companies that routinely mistreat injured or disabled people. As a Dallas, Texas lawyer, I've spent more than 45 years trying to help those poor folk, and I have been frustrated daily by the actions of the people on the other side of their claims. (Sorry if I offended you...)

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