Uber Acknowledges 6,000 Sexual Assault Complaints in Two Years

The company’s first ever safety reports reveals the prevalence of assault, the difficulties in preventing bad behavior, and plans to improve.

By: Katie Dwyer | December 17, 2019

Uber released its first U.S. Safety Report on December 5, breaking down the type and frequency of reported safety incidents and unveiling its plans to reduce them.

The results underscore the dangerous effects of growing too big, too fast and reveal a company attempting to right documented wrongs.

Key Findings from the Report

Over 2017 and 2018, Uber received 5,981 allegations of sexual assault, defined as unwanted kissing or touching, and including rape. It also counted 19 deaths resulting from physical assault either during or within 48 hours after an Uber ride.

Rides involving reported serious safety incidents constituted less than 1% of the 2.3 billion rides Americans took over those two years.

Drivers and riders are nearly of equal blame. In sexual assault cases, drivers were the accused party 54% of the time and riders 42% of the time.

What’s Not Included

The study did not include reports of physical assault resulting in injury, but not death. It also doesn’t account for sexual misconduct that doesn’t involve physical contact, including masturbation, asking for sex, or other lewd and vulgar language.

As in any study of sexual assault, there are likely to be many more cases that went unreported. These gaps suggest that Uber’s safety problems may be even larger than they are projecting.

Possible Next Steps:

Uber has been criticized in the past for not conducting background checks of its drivers as thoroughly and as often as they should. The new report states that the company will be conducting background screens on a continuous basis.

Uber has also developed a “panic button” for its app that allows riders or drivers to connect to emergency services in the event of an assault, and it has long included a feature allowing riders to share their trip progress with a designated third party, so someone knows where the rider is and can see if a trip has gone off course.

Uber is also debating whether it should ask drivers to install dashboard cameras and audio recording devices. While these tools would likely deter incidents and help to corroborate victims’ accusations, it also toes the line of privacy invasion.

The same is true when it comes to sharing information with authorities or with other ride-sharing platforms.

According to an NPR report, Chicago law requires ride-sharing companies to provide the names of drivers who have been banned from their platforms, which they then pass along to other companies.

A driver may be banned, however, without any evidence supporting an accuser’s case. The ban does not mean that a rigorous investigation took place and does not confirm that the driver actually committed the act he or she is accused of. There is some concern that sharing information could lead to unfair discrimination against innocent drivers.

Privacy laws vary from state to state, and ultimately Uber will have to remain compliant with whatever statutes are in place where they operate.

Where the Response Is Lacking

Beyond the proposal to install video cameras, the company does not specifically address how it will protect its drivers from violent riders, given that riders were responsible for nearly half of sexual assaults.

This bleeds into another issue besieging the company — the debate over whether drivers are employees or independent contractors and how that influences Uber’s obligations toward them. How far does the company have to go to keep drivers safe, and how much responsibility do they have to accept for their misconduct?

Some states have passed legislation requiring Uber to classify drivers as employees, but the company is fighting those changes. It has promised to conduct a new safety report each year and continue updating its processes to improve weaknesses, but the driver classification issue is likely to be a sticking point for some time.

The Takeaway

The release of the safety report is seemingly part of Uber’s plan to claw back public confidence.

The company experienced rapid growth almost as soon as it first started up in 2009, becoming a multi-billion-dollar company in just a couple of years.

But it never appreciated the potential for misconduct inherent in their model — placing strangers together in a car when neither party has been thoroughly screened — and did not anticipate the challenges of policing such a massive fleet of drives.

It has been dogged by scandal and bad press in recent years that tarnished its reputation and sent stock prices plummeting.

By making the new report public, Uber is trying to demonstrate its commitment to fixing its safety flaws and doing so with transparency. Next year’s report will show whether they’ve been successful. &

Katie Dwyer is a freelance editor and writer based out of Philadelphia. She can be reached at [email protected].

How a Carrier Partner Can Help Navigate a Challenging Management and Professional Liability Market

A combination of a choppy economy with increased claims frequency and severity could lead to rate increases in the Management & Professional Liability market.

By: Risk & Insurance | April 3, 2024

Rates in the management & professional liability (M&PL) markets were on the rise from 2020 to early 2023 and are now falling rapidly.

M&PL divisions manage a number of different insurance products including management liability (D&O), professional liability (E&O), employment practices liability (EPL), fiduciary liability policies, cyber, etc. In 2023 and into 2024, a big influence on the marketplace has been the extremely aggressive and softening public company D&O market.

Though these rates have been softening for management liability, that may change over the next few years as companies continue to adjust their business models motivated by economic uncertainty. Layoffs were up nearly 200% last year, Forbes reported, even as other recession indicators, like the inflation rate, improved. A recession could lead to an increased claim activity and force carriers to raise rates.

“Whenever there is a meaningful downturn in the economy, we tend to see claim frequency pop up,” said George Schalick, Jr., senior vice president of the Management and Professional Liability Division at Philadelphia Insurance Companies (PHLY).

With continued fiscal uncertainty, businesses potentially already burdened with pandemic-related claims should seek a carrier with a long history in M&PL products. They will provide much-needed risk management guidance and be better positioned to support their insureds during market fluctuations.

Why Insureds Might See an Uptick in M&PL Claims

George Schalick, Jr., Senior Vice President of the Management and Professional Liability Division, Philadelphia Insurance Companies

The current soft market might come as a bit of a surprise as it does not track with previous underwriting cycles and economic conditions. Afterall, many privately held and non-profit organizations struggled during the early days of the pandemic with shutdowns and rapidly declining revenues. But the Government assistance programs, like the Paycheck Protection Program loans, helped keep many afloat during the tough times.

“During COVID many organizations stopped doing business until they were able to sort out all of the health and safety challenges,” Schalick said. “They were forced to lock down, but then all the government assistance programs allowed them to keep people employed. The increased volume of claims we anticipated we would see coming from the lockdowns and restrictions that were imposed upon businesses in the U.S. didn’t manifest at first.”

“Just because there wasn’t an onslaught of reported claims at the beginning of the pandemic, doesn’t mean the circumstances that would give rise to a claim being reported didn’t occur. Courts and the judicial system were closed or slowed and now that they are back open, we’re starting to see the circumstances that occurred during the COVID lockdowns becoming claims today,” Schalick said. “Litigation is progressing.”

Added to the delayed pandemic litigation is a concern over newer claims that might be filed as the country inches toward an economic downturn. Though a recession was avoided in 2023, experts think a soft dip could occur in 2024, with 76% of economists saying there’s a 50% or less chance of an economic downturn this year — that almost always results in more management liability claims.

“During the Great Recession in 2008, we saw an almost immediate spike in claims because of the economic conditions and the pressure it placed on organizations. They were making personnel changes with significant belt tightening almost immediately.” Schalick said.

What’s in Store for M&PL Policy Rates in 2024?

Despite an uptick in claims and increased economic uncertainty, management liability rates haven’t increased, resulting in market-wide pricing levels that may not meet the increased pressure of rising settlements and jury verdicts.

“Rates are going the other direction and settlement values are not falling,” Schalick said.

The mismatch between rates, claim frequency and severity is, in part, because carriers experiencing the dramatic soft market in the public D&O market are seeking premium gain in the private and non-profit market.

“In the public company market, the rates have been decreasing significantly. The rates were increasing in the private, not-for-profit market, and rightfully so, but there’s a desire to supplement overall mid-size D&O for carriers who also write private not-for-profit, and they see that as an opportunity to aggregate premium,” Schalick said. “So the always competitive landscape in the private, not-for-profit market has dramatically increased in the last 18 to 24 months.”

Still, companies of all sizes and types should be concerned about management liability rates in the future. Legal system abuse is resulting in increases in both the amount of litigation and the size of verdicts plaintiffs are receiving.

Certain areas of the country are particularly vulnerable to this type of legal system abuse. As a result, insureds in these localities are likely to be vulnerable to rate increases.

“The environment is so positive for the plaintiff that forces premium increases so carriers are able to stay in that market long term,” Schalick said.

Why a Tenured Carrier Partner Can Help Insureds Navigate An Uncertain Market

It’s clear that insureds are facing an uncertain M&PL market over the next few years. Fortunately, carriers with a long history in the M&PL space will be there to offer stability.

Philadelphia Insurance Companies has been supporting this market for 35 years. PHLY is committed to offering long-term rate stability, even as economic and claims trends start to push premiums upwards. They have an appetite for all sorts of companies, large and small, for-profit and nonprofit alike.

“We’ve been at this game for a long time and are one of the most tenured underwriters in this space,” Schalick said. “We like to stay very consistent.”

PHLY has worked with both for-profit and non-profit on management liability policies. With dedicated M&PL teams throughout the company’s 13 regions, PHLY provides the support agents and brokers are looking for on behalf of their clients. The teams know their regions well and can respond to local trends. They’re also dedicated to making the renewal process as easy as possible for their partners and policyholders.

“We have real confidence in our results, so we focus a lot on making the renewal experience as painless as possible for all agents and insureds,” Schalick said.

The company is also investing in tools to help insureds avoid losses. Earlier this year, they launched a new online risk management platform, PHLYGateway, which offers resources for insureds on how to create an employee handbook and trainings on issues such as recognizing workplace sexual harassment and discrimination.

If insureds have questions, they can consult a Best Practices Help Line, provided via the platform. That way, they can get on the spot risk management guidance to help them prevent claims.

To learn more, visit: https://www.phly.com/mplDivision/managementLiability/default.aspx.

This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Philadelphia Insurance Companies. The editorial staff of Risk & Insurance had no role in its preparation.