E-Scooter Sharing Programs – Insurance Risks
Burns & Wilcox, national insurance broker, published this article regarding expanding use of e-scooters (electric scooters) . They talk about the inherent risk to the e-scooter sharing companies but no mention of the ‘driver’ being an employee and using on company business. Something we will have to explore and publish in another blog. Below are excerpts from this article.
Electric scooter (e-scooter) sharing programs continue to flourish in cities worldwide, including hundreds in the U.S., Europe, and new expansions into Canada. E-scooter companies, such as Bird and Lime, put “dockless” electric scooters on city sidewalks for riders to pick up, use and set down at their destination.
Scooters represent a burgeoning trend known as “micromobility,” the use of light vehicles as an alternative to cars. The surge shows no signs of easing: some studies predict that the shared micromobility fleet will reach 39.6 million vehicles by 2023.
As these programs spread, so do their inherent risks. Self-operated rented electric scooters are roaming around cities yet to provision dedicated paths, at speeds up to 15-20 miles per hour. Just last month, a man riding a rented scooter in San Diego, California hit a tree and later died from his injuries.
Following a slew of accidents, some cities, like Beverly Hills, California, have banned e-scooters and more are exploring options to control them. This is just one sign among many that this bold new world of riding comes with the risks inherent in operating any vehicle, as well as a few new ones. Like any emerging business, scooter sharing companies are still evolving, exploring how they can be both profitable and protected.
Easy access for riders but limited protection for service providers
Scooter sharing programs generally work via a phone app allowing a user to rent and unlock a scooter wherever he or she finds one—the scooters are placed and tracked by apps throughout cities in which there are programs. Once a rider unlocks a scooter, it can be used until he or she ends the ride via the app.
Riders sign waivers, agreeing to abide by arbitration and giving up the right to sue, which does protect sharing companies to some extent, said Adrian Smith, Managing Director, Burns & Wilcox Brokerage, Chicago, Illinois. However, waivers may only involve rider injuries, and scooters pose many other risks, Smith added. Riders may crash into pedestrians, other riders, or damage property.
Oftentimes, they are not contained in racks like rental bicycles; e-scooters can create trip hazards on sidewalks and limit access to building entrances. Such barriers present significant challenges for persons living with disabilities. The sharing company could be held liable for restricted access, injuries or damages involving its e-scooters.
Insurance Coverage need assessment is tricky, but vital
Given the current environment in which scooter sharing companies operate, Commercial General Liability Insurance is essential and a good starting point to ensure proper coverage, Smith said. General Liability Insurance policies can help scooter sharing companies manage costs incurred from injuries to third parties, he explained, such as collisions with pedestrians or someone tripping over a scooter lying on a sidewalk.
Scooter sharing companies’ liability for injuries and property damage continues to be reassessed and revised, Smith said. For example, Los Angeles has already taken steps to regulate the level of commercial General Liability Insurance scooter companies must hold, and to establish scooter speed limits and parking zones. Insurance experts are in the best position to assess companies’ shifting needs and inform coverage decisions.
This information was provided by Burns & Wilcox, North America’s leading wholesale insurance broker and underwriting manager.