Lyft’s insurance coverage loophole
While ride sharing services have become more popular, we need to be careful of a loophole in Lyft’s insurance coverage for riders.
I recently learned of a case in Colorado where an individual attempted to sue Lyft for injuries sustained in a collision while he was a Lyft passenger. The car he was riding in was struck by a hit and run driver so he assumed Lyft’s uninsured motorist (UIM) coverage would cover his bills since that is what that coverage is meant for. He ended up suing when Lyft refused to pay his medical bills but was surprised when his case was dismissed.
Turns out Lyft did not carry UIM coverage in Colorado because under state law UIM is a coverage that can be declined. On Lyft’s website they address UIM but note in a very hard to find spot “coverage where provided may be modified to the extent of the law.” So since Colorado does not require UIM coverage, Lyft took the cheap way out and declined the coverage, which is relatively inexpensive.
Another reason Lyft’s decision is not consumer friendly is that some use their service because they do not own a car. However, if you own a car and have UIM coverage on your car it would extend to you when using a ride sharing service. In Idaho UIM coverage can be declined so be aware that you may not have that coverage through a ride sharing service.
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Unemployment fraud has reached pandemic levels
Be on the lookout for a form 1099-G. If you did not file for unemployment benefits and you received a 1099G that means your identify was likely stolen by scammers. Unemployment fraud has reached pandemic proportions since COVID-19 started locking down many small businesses forcing millions of people out of work.
Criminals have taken advantage of the mayhem and have bombarded the system with bogus claims as millions were losing their jobs due to the coronavirus shutdowns. Now tax forms are being sent to people who never collected unemployment benefits. Estimates are starting to come in that these fraudulent claims total in the billions of dollars nationwide.
Since unemployment benefits are taxable, governmental agencies are sending out 1099-G forms so people can report the income on their tax returns. Problem is that while a record number of claims have been processed, a record number of fraud has also been identified as part of the process.
There are examples where taxpayers haven’t worked in decades but are now receiving 1099-G forms because according to the employment office these people received unemployment benefits last year. Turns out the unprecedented surge in unemployment claims has strained the unemployment offices because many states still rely on 1960s-era software to process applications and issue payments.
The U.S. Department of Labor’s Office of Inspector General has estimated that states have paid as much as $36 billion in improper benefits. Now people who have received fraudulent 1099-G forms are requesting corrected tax forms.
Unfortunately, the IRS has said that many victims won’t be able to get a corrected tax form in time to file their federal taxes. However, people receiving bogus 1099-G forms should still try to contact their state unemployment office to see if a revised 1099-G can be issued. It would also be a good idea to contact your tax accountant for assistance.
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Does freezing your credit hurt your credit score?
I have recommended freezing your credit in order to lock down your credit reports. Doing this makes it nearly impossible for criminals to open new accounts in your name because creditors need to look at your credit report to decide whether to extend you credit or not.
Recently I have received a couple calls from local readers who want to know if freezing their credit will hurt their credit score. The short answer is freezing your credit has no direct impact on your credit score. In fact, freezing your credit can actually help improve your credit score (or at a minimum keep it from dropping), because it prevents unwanted credit lines from being opened in your name.
Also, a credit freeze will not “freeze” your credit score where it is. Your credit will continue to rise and fall depending on how responsible you are with your credit. According to the Federal Trade Commission (FTC) here are a few other factors to consider when deciding to freeze your credit:
• You can still get your free annual credit report.
• You will need to “thaw” your credit in order to open new accounts yourself, apply for a job, rent an apartment or get insurance. Once you are done, you will need to put the freeze back on your account, which is free of charge.
• You will need to continue to monitor your existing credit since criminals may be able to access your open accounts.
• If you would like to stop receiving pre-screened credit offers you can opt out by calling 888-5optout or 888-567-8688.
To recap, freezing your credit can provide some peace of mind that new lines of credit cannot be opened in your name. Even lifting a freeze to access your credit and placing the freeze on your account again only takes a few minutes. And finally, placing a freeze on your credit does not negatively impact your credit score.
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Remember: I’m on your side.
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If you have encountered a consumer issue that you have questions about or think our readers should know about, please send me an email at terridickersonadvocate@gmail.com or call me at 208-274-4458. As The CDA Press Consumer Gal, I’m here to help. I’m a copywriter working with businesses on marketing strategy, a columnist, a veterans advocate and a consumer advocate living in Coeur d’Alene.