Uber on Thursday raised the minimum age requirement for most new drivers in California to 25, a requirement the company said was necessary because of the state’s rising cost of commercial auto insurance.
The new rules only apply to drivers who sign up to deliver passengers through Uber’s ride-hailing platform, not drivers who deliver meals through Uber Eats. Previously, drivers as young as 19 could sign up.
People under the age of 25 who activated their accounts by Wednesday can continue to drive for Uber, the company said.
Insurance rates for Uber California drivers are significantly higher than those for private car or taxi drivers, according to a company statement announcing the change.
“As a result of these unbalanced requirements, personal injury attorneys have created a cottage industry of suing ride-sharing platforms like ours, causing Uber’s California-mandated business insurance premiums to rise by more than 65% in just two years,” the company said. . “By raising the age requirement for new drivers to 25, we hope to mitigate these cost increases.”
All 50 states require drivers to have commercial insurance in order to make money from ride-hailing. Uber offers drivers commercial auto insurance, which includes at least $1 million in liability coverage once a ride is accepted. Personal auto insurance generally does not cover activity on ride-hailing apps.
Lyft, Uber’s main competitor, already has a minimum driver age of 25.
Starting Thursday, drivers under the age of 25 who try to sign up for Uber will receive an email explaining the new policy and providing a link to more information.
The new restrictions come amid a recovery in passenger numbers after a severe slump due to the pandemic.
Uber is now handling more rides than it did in 2019, raising hope that the company will eventually achieve its long-term goal of sustained profitability.
With this goal achieved, management has increased its focus on cost containment, which may have been a factor in the decision to fire drivers 25 and under.
Uber’s food delivery service, which will continue to have this demographic as drivers, accounts for a third of the company’s revenue.
Uber looks forward to working with state lawmakers and industry experts to “discuss legislative and regulatory changes to improve the experience for all California drivers,” the statement said.
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