For Uber or Lyft drivers who drive their own vehicles or use TLC car leasing, taking cash is a bad idea for keeping your business running
For those who have been using their own vehicles or rent a TLC car for Uber or Lyft business, there have probably been occasions when a passenger will offer cash for a ride. Perhaps it’s a friend or relative or someone who doesn’t have a way to pay on the app, but in all cases your answer should be a resounding no.
Called Back Door Ubering, the practice of taking cash for drivers who use TLC car leasing or perhaps own their own vehicle is quite common. In fact, many are taking cash on a daily basis, especially in light of the new Upfront Pricing that has been put into place. Admittedly, there are subtle benefits from taking cash for both drivers and passengers since they get to earn or save a little more money.
However, there are good reasons why you should never accept cash from a passenger, especially in light of the strict rules that Uber and Lyft have put into place.
Deactivation: If you are caught taking a cash ride, Uber and Lyft will most likely deactivate you and your business with them is over. All it takes is one report and that may be enough to remove you from Uber or Lyft.
No Insurance: Another, perhaps even better reason why cash rides should be avoided is that the passenger is not covered by Uber and Lyft’s million-dollar liability insurance. So, if an accident happens and your passenger is injured, you can be left holding the medical bill. You might be covered by the insurance and you have a small amount of out-of-pocket expenses that Uber and Lyft provide, but that is nowhere near enough to cover a substantial injury to a passenger.
Basically, there is no easy way out if an accident should occur with a passenger paying cash. Using the Uber or Lyft app means that they are covered as they are registered in the system. About the only way you are covered is if you have full commercial coverage insurance which is the most expensive you can purchase. Few people have such coverage for obvious reasons, mostly because of rideshare coverage.
However, rideshare coverage does not protect you in case of an accident when the passenger is injured. Lying to your insurance company about the situation is a non-starter as well since if they find out, they will cancel your coverage. Plus, it is insurance fraud which is a felony.
The danger for Uber or Lyft driver using TLC leasing or their own vehicles is that the temptation for cash rides is strong given how accidents are infrequent. Just remember that the chances of an accident happening are the same each time you drive, so the best move for those who use their own vehicles or take advantage of TLC car leasing is to not accept cash rides at all.