It's certainly possible, but it's unlikely. The Lyft driver's own assets are likely small, and most lawyers suing the driver would rather settle for an amount within the $1 million insurance policy, rather than risk getting nothing by going to court to try to get more than the insurance policy.

Even many doctors don't have malpractice insurance above $1 million (depending on speciality and state) -- most policies are $100K-$300K/claim, $1MM-$3MM/all claims (http://jop.ascopubs.org/content/3/5/274.full). So Lyft is providing more liability insurance than many doctors carry.

If you're demanding absolute 0% risk for the Lyft driver financially, this would not cut it, but very little anywhere is absolutely no risk.

For one, it has a $2,500 deductible.

It is also only active during a Lyft ride.

My liability portion is $250,000 each person / $500,000 each accident and State Farm only wants $30 a month for it.