Sharing services such as Uber, Lyft and Airbnb have been in thenews quite a bit lately.

There was the horrific story about the Uber driver in Kalamazoowho allegedly killed six people and injured two others betweenpicking up and dropping off some of his passengers. And then therewas the recent article about some Airbnb patrons who found adecomposing woman's body in the garden of the Palaiseau, France,home in which they were staying. These are terrible stories but areincidents that could also happen while using other forms oftransportation, staying in hotels, or going about everydaylife.

There are some issues, however, which apply specifically tothese service-sharing applications (apps) and their use, creatingrisks and financial exposures for the service supplier and customerif the providers are not properly insured to deliver theseservices.

Automobile exposures

Anyone who plans to make additional money as an Uber, Lyft orother ride-sharing service driver should be aware of the insurancegaps that may exist. Failure to consider them may expose the driverto unexpected consequences. One of the ride-sharing platformsstates on its opening website page — "Signing up is easy — Sign uptoday and you'll be on the road in no time. Plus, signing on takesless than 4 minutes. Don't wait to start making great money withyour car."

The risk to a new driver is immediate because the usualautomobile liability coverage is specifically excluded when workingwith these ride-sharing platforms. For example, a Georgiaautomobile policy states the following exclusions under theLiability Coverage, Medical Expense Coverage and Uninsured MotoristCoverage sections:

Exclusions

1. This coverage does not apply tobodily injury or property damage to a person:

a. While occupying your insured carwhen used to carry persons or property for a charge. This exclusiondoes not apply to shared-expense car pools or the charitablecarrying of persons.

Therefore, a potential driver should not plan to workimmediately after signing up for the service. Drivers shouldpurchase commercial automobile liability to cover the lossesexcluded by their personal automobile policies. Some insurancecompanies have attempted to provide commercial policies for thesedrivers, but it is fair to say that the market is still trying tounderstand the real exposures they face. Potential drivers shouldresearch the insurance requirements for their state and discussthis with an insurance agent to obtain the necessary coverage at areasonable price, since there seem to be wide variations in pricingfor this product. Be sure that the cost of this commercial policydoes not negate the financial benefit of driving.

Potential drivers should also clearly understand the rules,exclusions and coverage limitations imposed by these ride-sharingplatforms. While each of these companies provides some guidance orinformation on insurance requirements, some of them are somewhatunclear, and there have been cases in which the ride-sharingcompanies were reluctant or slow in assuming liability for theirportions of the loss.

Related: More Americans now work in gig economy than live inGeorgia

The insurance requirements these companies list also vary bystate or even city, and some of the coverage they provide iscontingent on the driver's coverage. Each state has its own rulesconcerning the minimum limits for liability coverage, and some inthe industry definitely believe that minimum limits are rarelysufficient.

This is especially true for those who live in an area withrelatively well-to-do customers or in an especially litigious area.Potential drivers who plan to serve an area encompassing two ormore states should also research the rules and requirements foreach state in which they may drive.

For example, a driver in certain parts of New Hampshire shouldconsider requirements in New Hampshire, Vermont, Maine, andMassachusetts. A driver in Washington, D.C., should considerrequirements in D.C., Virginia, Maryland, West Virginia, Delaware,and even parts of Pennsylvania. You get the picture.

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Homeowners' exposures

Airbnb is perhaps the best-known "home-sharing" app, but manyindividuals with second homes, especially in typical "vacation"areas, may also exchange or lease their properties. Propertyproviders should consider potential exposures to confirm they haveappropriate coverage for the risks.

Airbnb provides "Host Protection Insurance," which is primaryliability coverage for Airbnb hosts and landlords up to $1,000,000through Lloyd's of London. While this is substantial coverage, eachhost or landlord should determine if $1,000,000 is sufficient. Therisks around the property as well as the financial condition of theguests should be considered.

The coverage also excludes some items that may represent asubstantial gap in protection. For example, the coveragedescription states that the "program does not apply to liabilityarising from (1) intentional acts including: (i) Assault andbattery or (ii) Sexual abuse or molestation — (by the host or anyother insured party), (2) Loss of earnings, (3) Personal andadvertising injury, (4) Fungi or bacteria, (5) Chinese drywall, (6)Communicable diseases, (7) Acts of terrorism, (8) Productliability, (9) Pollution, and (10) Asbestos, lead or silica."

Let's take a few of these exclusions to examine the potentialexposures (see table below).

Owners should also be aware that their own Homeowners coveragemay not apply if they are exchanging or leasing their property.Even if it did, there are many exclusions that may also preventthem from having the coverage they need. Homeowners insurance andCommercial Property insurance are constantly evolving, with newexclusions and conditions appearing annually.

There are a number of potential risks in providing theseservices, too many to be covered in-depth here. Some of these"service-sharing" apps are opportunities to provide owners ordrivers with additional income or ways to swap with others to allowtravel to areas that may otherwise be unaffordable. However, it iswise to be cautious and ensure that this extra income orproperty-swapping event does not turn into an incident from whichyou can never recover.

Related: The scary insurance reality for Airbnbhosts

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