Uber Technologies Inc. is pouring millions of dollars into a national ad campaign to push for reforms in insurance policies that it says have been exploited by personal injury lawyers and contribute to higher ride prices.
The San Francisco-based rideshare company is agitating for legislative changes that would lower state-mandated insurance limits. This, Uber says, would help deter personal injury lawyers from taking advantage of lucrative policies and seeking high payouts. It has so far joined political coalitions and launched an advocacy website that includes state-by-state data on how insurance costs factor into rideshare prices to raise awareness for its cause.
This week, it began a seven-figure advertising campaign in newsletters and news outlets, according to a company spokesperson. Those include sponsored placements in national and local political outlets like Politico’s New York Playbook newsletter. Next Monday, it will launch video ads on social media networks, YouTube and TV streaming platforms, urging consumers to take action to keep their rides “affordable,” according to an early version of the advertisements reviewed by Bloomberg.
This bid is one of Uber’s largest lobbying efforts to manage operational costs since its regulatory fights to keep drivers independent contractors and not employees across the nation. The push also comes as inflation pushes up prices on a variety of goods, from eggs to used cars. The cost of rides is the leading reason consumers don’t use rideshare services more often, according to a 2024 report by pricing aggregator Obi.
Legal settlements and regulatory fees are a growing cost of business for Uber that risk eating into the company’s profits, its most recent earnings report shows. The firm set aside $462 million for legal, tax and regulatory matters in the fourth quarter, the most it has earmarked since the first three months of 2024.
Uber’s concerns around insurance came to a head when Chief Executive Officer Dara Khosrowshahi last fall warned of a slowdown in its core US rideshare business, citing higher costs the company passed on to consumers. The firm observed this dynamic in places such as New Jersey and California, he said at the time, where Uber estimates insurance comprises as much as 32% of fares.
In addition to those two states, it also plans to place ads in Georgia and Nevada, which have some of the most expensive policies. The company’s insurance costs for rides nationally have gone up by about 50% per trip over the past three years, it said on its advocacy website.
“While insurance cost increases are easing, the legal system remains broken, allowing personal injury lawyers and a shady network of pain management doctors, chiropractors, and third-party lenders to exploit rideshare insurance mandates for financial gain,” said Adam Blinick, who oversees the firm’s public policy and communications in US and Canada.
Blinick added that this is an opportune time to conduct advocacy work at the federal level, given inflation was a key voting issue during the last election cycle.
The company is not just placing advertisements. In New York, it’s contributing at least a million dollars to a coalition called “Citizens for Affordable Rates,” which supports local legislation that would reduce minimum liability coverage for rideshare drivers. It also filed a racketeering lawsuit against a group of law firms and medical practitioners it claims staged fake car accidents and performed unnecessary surgeries to take advantage of the state’s no-fault insurance policies. The defendants didn’t respond to a request for comment about the case.
On a national level, Uber has recently joined the “Protecting American Consumers” coalition to target predatory legal practices, according to Blinick. The entity, which also includes Waffle House Inc., is similarly pledging to spend more than $10 million this year toward the effort, starting with a marketing campaign in Georgia to support legislative changes that dovetail with Governor Brian Kemp’s high-priority push to lower insurance rates in the state.
The company is also taking initiatives to cut costs internally. It began piloting a program in Los Angeles and San Diego in December that promises to pay drivers back a few dollars or cents per mile if they maintain their own commercial permit, registration and insurance. It plans to expand that program throughout California in the coming months.
Photo: Photo credit: Jeenah Moon/Bloomberg
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