Uber raises minimum age for most California drivers to 25, saying insurance costs are too high

SAN FRANCISCO — Uber raised the minimum age requirement for most of its new drivers in California to 25 on Thursday underneath laws the corporate mentioned are vital as a result of the emerging costs of industrial auto insurance within the state.

The new rule applies handiest to drivers signing up to delivery passengers with Uber’s ride-hailing platform, and no longer for the ones handing over meals with Uber Eats. Previously drivers as younger as 19 may enroll.

Those underneath 25 who activated their accounts prior to Wednesday can proceed to power for Uber, the corporate mentioned.

Insurance charges for Uber’s California drivers are considerably upper than for private cars or taxi drivers, in accordance to an organization commentary pronouncing the exchange.

“As a result of these lopsided requirements, personal injury attorneys have created a cottage industry specializing in suing rideshare platforms like ours, pushing Uber’s California state-mandated commercial insurance costs to rise by more than 65% in just two years,” the corporate mentioned. “By increasing the age requirement for new drivers to 25, we hope to mitigate the growth of those costs.”

All 50 states require commercial insurance for drivers to earn money with a ride-hailing service. Uber maintains commercial auto insurance for drivers — including at least $1 million of liability coverage once a ride is accepted. Personal auto insurance typically doesn’t cover activity on ride-hailing apps.

The minimum age is already 25 for those driving for Lyft, Uber’s main competitor.

Starting Thursday, drivers under 25 trying to sign up with Uber will receive an email explaining the new policy and providing a link to more information.

The new restriction coincides with a resurgence in passengers following a deep downturn due to the pandemic.

Uber is now handling more rides than it did in 2019, raising the company’s hopes that it may finally realize its long-term of goal of becoming consistently profitable.

Realizing that objective has sharpened management’s focus on cost control, a factor that may have contributed to the decision to drop 25-and-under drivers.

Uber’s food delivery service, which will continue to let that demographic work as drivers, accounts for one-third of the company’s revenue.

Uber hopes to paintings with state lawmakers and business professionals “to discuss legislative and regulatory changes that will improve the experience for all California drivers,” in accordance to its commentary.