15 Minutes Could Cost You Big Time

By Jan Brownlee, CPCU,
E&O Plus Account Manager
Assurex Global

Electric scooters for rent, owned and operated by Lime and Bird, began popping up on the streets of nearly 30 major American cities this summer. We have them in Columbus. These scooters are fun and affordable – you can unlock one for $1 and they are 15 cents a minute thereafter. The maximum speed is 15 miles per hour and they can go up to 15 miles on a single charge. They are being touted as an alternative to Uber and Lyft for short hops around the city.

The scooters are meant to be ridden on streets or in bike lanes, typically not on sidewalks, and should be parked out of the right of way. To rent, riders must show their driver’s license and be age 18 and older. In addition, some states require riders to wear helmets, refrain from carrying passengers or leaving scooters lying on their sides.

But many cities have issues with these scooters because they don’t yet have ordinances to address vehicles like these. The City of Indianapolis has issued a cease-and-desist order for Bird and Lime as the city works on drafting rules and regulations for the scooters. Santa Monica, California officials will soon vote on a proposal to cap the number of scooters and apply tougher penalties for breaking the California law regarding them. The City of Milwaukee filed a lawsuit on July 7 against Bird, ordering the scooters’ removal from streets and sidewalks in downtown and adjoining metropolitan areas, bit Bird did not comply. The City of Bexley, Ohio took more drastic measures. Citing a violation of the city’s regulations regarding“transient dealers,” police officers removed scooters from three locations in their city.

One thing for sure, accidents can happen. Brakes can lock or malfunction, but worse, the rider can lose control of the scooter. Many reported accidents involve single riders, who break an arm, collarbone or leg. But, more serious mishaps are where scooters hit a pedestrian or the car/scooter accident. In fact, personal injury attorneys are inundated with calls from scooter related accidents.

The scooter rental agreements are very restrictive regarding liability of the riders, making the rider/renter “solely responsible and liable for any and all consequences, claims, demands, causes of action, losses, liabilities, damages, injuries, costs and expenses, penalties, attorney’s fees, judgments, suits, fees.” See links below for the full rental agreement wording.

Should an accident happen, then collecting from the at-fault rider can be problematic. The rider’s Personal Auto Policy won’t cover liability because most policies exclude liability coverage for “any motorized vehicle having fewer than four wheels.” In addition, the vast majority of homeowners’ policies do not cover motor vehicle liability. “Motor Vehicles” are defined in the Insurance Services Office Homeowners Policy form as “a self-propelled land or amphibious vehicle.” An exception to this exclusion are non-owned motor vehicles designed for recreational use off public roads. Since most city ordinances and the scooter rental companies require the scooters to be driven on city streets or bike lanes, the rider will usually not be covered by the liability provided on his or her homeowners policy. The exception could be if the rider is on a sidewalk, where permitted by law, or on private property, such as a park.

Some attorneys feel the waivers in the rental agreements won’t bar claims against Lime or Bird for gross negligence. However, both the scooter company and the rider are likely to be named in a suit when a serious accident occurs. Worse yet, a self injury brought on by riding a scooter can lead to pain, suffering, lost time at work and other related issues.

Until the insurance industry addresses the liability of scooter rentals, people should avoid them altogether or assume the risk involved. Unlike GEICO, 15 minutes could cost you rather than save you. Riding scooters can be fun, just know the potential consequences should something go wrong.

To view Lime’s Rental Agreement, please click here.

To view Bird’s Rental Agreement, please click here.

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