If you meet the requirements to drive for Uber, Lyft, or another ridesharing service, you can earn money as a rideshare driver. But once you start welcoming strangers into your car, you’re officially driving commercially, which means that your personal auto insurance policy might not cover you if you get into an accident. If you’re thinking about driving for Lyft or Uber, it’s essential to understand what rideshare insurance is so you can make sure your policy provides the protection you need.
Do I Need Rideshare Insurance?
When you’re picking up riders in your personal vehicle, you may assume that your personal auto policy covers you. But since you’re earning money by chauffeuring others, it probably won’t. Once you log into the rideshare app and mark that you’re available, most personal plans stop providing protection. So, if you get into an accident while you’re waiting for someone to request a ride, you might not be covered. Rideshare insurance fills in this gap so you’re covered all the time, whether your rideshare app is on or off.
Lyft and Uber Insurance Coverage
Ridesharing services like Lyft and Uber are considered transportation network companies (TNCs). And while both Lyft and Uber offer insurance for their drivers, their policies may not completely protect you. When you work as a rideshare driver, your work involves three main phases, sometimes known as “periods.” Your TNC’s insurance coverage varies, depending on what phase of rideshare driving you’re in. This table explains the coverage provided by Uber and Lyft during each phase. Once you’ve been matched with or are driving passengers, the TNC insurance provides liability, comprehensive, and collision coverage. But the comprehensive and collision coverages only apply if you have those coverages on your personal car insurance policy, and the high $2,500 deductibles could leave you with unexpected out-of-pocket expenses.
Enhancing Rideshare Insurance Coverage
Before you’re matched with a rider, your TNC provides only liability insurance, and the limits may not be enough to cover the costs of a serious accident. To help protect yourself, consider purchasing an add-on policy or rideshare endorsement from your car insurance company. Here’s an overview of the coverage provided by a selection of rideshare policies from major insurance companies as well as TNC insurance and your personal policy.
Alliance West Insurance AllstateAmerican FamilyErie InsuranceProgressiveState FarmUSAA
This list isn’t comprehensive, so contact your agent to see whether this type of insurance is available.
