When Choosing Between a Yellow Cab or Uber/Lyft Ride, Go with the Latter, Despite the Cost

I saw an article in the paper this week that commented on the devastating cab shortage in post-pandemic New York. It stated that in February of 2020 there were 11,400 cabs in service and that number is now down to 4,900.

In the meantime, New York City has sadly taken a step back to 1980, with sardine can subways offering violence, graffiti, and slashers. So, even though New York has made only a partial comeback in its work population, the traffic is already crazy on the streets because people are willing to spend more money to travel above ground in cars, where it’s safer.

The end result of this 1-2 punch, is that Uber and Lyft are charging more than cabs due to supply and demand. . . that’s capitalism people.

However, despite cabs charging a bit less than Uber/Lyft, I would personally still suggest using Uber/Lyft.

Why? Below are several reasons from a legal point of view:

• UBER/LYFT HAVE MUCH BETTER INSURANCE COVERAGE: Once you hail an Uber/Lyft, the liability insurance on the car is $1 million – whereas a yellow cab only carries $100,000 of coverage, the New York minimum. This means that if there is an accident and you suffer a bad injury, you can collect an additional $900,000 from Uber or Lyft. That is a HUGE positive for Uber/Lyft and I don’t think I should need to further convince you. Uber gives you $900,000 additional insurance per ride for an extra $2. It’s a no-brainer. But, OK, you’re stubborn and need more support. Let’s go to the next point.

• UBER/LYFT CARS ARE FRESHER: Uber and Lyft are usually cars owned by the driver, who probably drives his car 8 hours per day for work and wants to keep it clean and working correctly, so he or she can use it for their personal driving. On the other hand, a yellow cab often has 3 shifts of drivers, operating the car 24/7 and thus beating the hell out of the car, as they hit potholes, abuse the engine, and bald out the tires. That’s comforting during a New York City ice storm, right?

• AMERICAN TRANSIT, THE YELLOW CAB CARRIER, IS NOT USER FRIENDLY: American Transit has the insurance for many, if not all, of the yellow and livery cabs. They are not a user-friendly insurance carrier and, prior to the pandemic, were impossible to reach by phone. Now, for the last year, the staff works virtually, and they have ZERO phone lines for the bodily injury division (100% true). That is a formula created by a company that simply doesn’t care if you were injured in one of their cars and has no interest in speaking to you. You need to email a message to a general mailbox and hope that an insurance adjuster calls you back. I don’t know about you, but I have enough going on in my life that I don’t need to chase down a customer service rep.

• UBER/LYFT HAVE BETTER FINANCIALS AND THIS MAY DOOM YELLOW CAB INSURERS: Like many people, I can spot an economic trend. Private contractors like Uber/Lyft are putting drivers on the roads in nicer cars – bigger, newer, more comfortable. You hire them quickly by hitting an app on your phone. Seconds later, you are told, “Doug will meet you in 3 minutes at the spot in which you are standing”. EVERYONE LOVES DOUG. If I can quickly call Uber, why do I want to stand in the rain like a soaking wet imbecile and fight 20 people for a yellow cab, while trying not to get hit by a bus? I don’t. If I was a betting man, I suspect yellow cabs will be a dead business in the very near future. To punctuate my trending theory, a medallion, which is required by the Taxi & Limousine Commission in New York City if you want to operate a yellow cab, was valued at about $1.1 million in 2014. However, as of this month, those same medallions are worth less than $200,000. So, if cab drivers have lost 80% on their investment, it means they don’t have as much money to pay their carrier high insurance premiums. That means the yellow cab carriers are also feeling a financial pinch, and it’s snowballing, not slowing down. Do you know what happens to your lawsuit against an insurance company if the carrier files for bankruptcy? Probably not – thank goodness you have me to tell you. When that happens, your bodily injury lawsuit gets “stayed” (all activity comes to a slamming stop), until the stay is lifted by the bankruptcy court or the company emerges from bankruptcy. If you were injured, and need your case to resolve soon, that’s too bad – you have to wait. But more significantly is that when you do get paid, you will only see pennies on the dollar. If your case was previously worth $100,000 then, now you may only get $30,000. Awesome, right?

I’ll admit, this blog is an opinion piece. But I’m an educated consumer and a legal advisor. I’m telling you that Uber/Lyft, while a little more expensive at the moment, is a hell of a lot safer option than a yellow cab, offering you insurance protection from the crazy New York traffic and congestion. You don’t have to listen to me, but you should know that I’m usually paid a lot of money for my opinions, and I just gave you this morsel for free. Stay safe.