It was as inevitable as it is tragic. A little girl lost her life in an accident caused by an Uber driver.  “Not our fault!”, Uber was quick to respond, and the technophiles, fearing a luddite backlash that might slow progress, ran to their defense in countless online forums.  On the surface it seems like a no brainer, I admit.  I mean Uber is just a matching service.  They make no real guarantees.  And after all, this driver was supposedly off duty.  Even if he had been on duty, I strongly suspect Uber would have dodged.  “Well it should be all on the driver!”, goes the common assertion.  This leaves me puzzled, though, as a concerned consumer.  As consumers, why are so many of us making this particular argument?  It is enormously self destructive.

Let’s consider why businesses carry liability insurance to begin with.  There was a time when caveat emptor, had some serious gravity to it.  It wasn’t long ago when you had pretty much no recourse at all no matter how much injury you may have suffered at the hands of an employer, or a service provider, or a government agency.  Liability laws, and the insurance industry, make it possible to at the very least receive some sort of monetary compensation for any injury you suffer.  This isn’t a lotto ticket either as many reflexively “anti-tort” folks would be quick to argue.  Ask someone who has been left a paraplegic as the result of a drunk drivers actions if they feel like they hit lotto.

In this age of democratization through technology, where we see more and more services shifting from an institutional model to an entrepreneurial one, how are we going to ensure that we don’t take a big step backwards in terms of consumer protection?  If your child is crippled by an Uber driver today, there is no law mandating how much liability insurance they need to carry and any recovery would be limited to the meager assets they may have.  Sorry, but that’s not going to cut it.  Especially since personal liability requirements can be very low.  Imagine finding out you have $500k in medical bills and the person that caused them has $10k in insurance and the billion dollar company that introduced the two of you has $0 in liability?  This fully applies to the various lodging services as well.  I dread the first case of assault, or robbery, or worse stemming from these “couch surfing” type sites.

Caveat emptor indeed!