Most insurers provide additional rideshare insurance that protects drivers between trips; this coverage tends to be significantly less costly than full commercial policies.
Uber provides up to $1 million in liability coverage while you have its app open and are transporting a passenger. However, this coverage is contingent; your own auto policy must pay up first (this is called primary insurance in insurance-speak). To protect yourself and fill any gaps that exist between rideshare endorsement and primary policies and their payments you might consider purchasing either an additional rideshare endorsement or commercial auto policy with separate rideshare-specific provisions.
Uber and Lyft both provide their drivers with insurance, but it may not cover serious accidents. Rideshare endorsement insurance supplements your personal auto policy when logged into Uber/Lyft app on-duty. In New Jersey, a contingent commercial policy covers up to $50,000 of driver liability per person injured as well as $100,000 of injury or property damage caused. From when you accept trips until after completion and exit the vehicle is covered.
This coverage, typically up to the limits set forth by your state, typically includes bodily injury and property damage liability, uninsured/underinsured motorist coverage, medical payments/personal injury protection (PIP), comprehensive/collision coverage for your personal car policy as well as physical damage up to its actual cash value (after paying a $2,500 deductible).
Liability insurance covers damages to other people’s vehicles if you cause an accident that injures them, or your passengers. Uninsured/underinsured motorist coverage protects both parties in these instances if their at-fault driver doesn’t carry adequate insurance, while medical payments or PIP insurance covers your medical costs when an accident you caused results in medical expenses for them as well.
At Uber’s Period 1 insurance rates are great starting point; however, it’s essential that drivers understand what will happen in an accident before searching or accepting rides. Without dedicated rideshare insurance coverage from leading car insurers when engaged in business activity during an accident can mean your personal auto policy could deny any claim due to being out on business activities at that moment in time – leading car insurers provide dedicated rideshare policies as an add-on when on duty and ready to accept rides.
Uninsured/Underinsured Motorist Coverage
As an Uber driver, you may encounter motorists who do not carry sufficient insurance protection or drive without sufficient liability protection. Should they collide with your vehicle and cause injury to it, adequate uninsured/underinsured motorist coverage must be obtained to cover medical bills and other expenses incurred due to collision.
Uber and Lyft each provide their drivers with $1 million of uninsured/underinsured motorist coverage while they are using the apps and transporting passengers, but this only offers minimal protection; without an additional rideshare policy from Progressive, your personal insurer would become the primary insurer in such instances; which could pose significant difficulties if an at-fault driver lacks insurance or has only limited liability, such as $25,000 coverage.
Alternatively, if someone without adequate coverage hits your car while you are on your way to pick up passengers for Uber, most personal auto policies treat rideshare driving as a business activity and may require you to add what is known as a “rideshare endorsement”.
Most insurance companies provide this coverage at an affordable cost; you can learn more about what each policy entails by viewing our Uber Car Insurance Guide. Depending on the vehicle type you drive, additional rideshare or commercial policies may also need to be secured.
As an Uber driver, it is wise to consider purchasing a separate commercial auto policy as well. While these may cost more than regular personal policies, they can fill any gaps created by Uber car insurance policies.
Uber drivers can lower their auto insurance premiums by gathering multiple quotes and shopping around for discounts. Many insurance providers offer safe driving, bundling, and good student discounts that could reduce premiums further. Furthermore, many states mandate minimum coverage levels; making it even more essential that Uber drivers shop around before making their final decision.
Driving for Uber can be an attractive way to earn extra income and many drivers turn it into their full-time profession. As part-time Uber driver or considering it as your career choice, it is crucial that you understand how your personal car insurance and rideshare insurance work together and whether any additional coverage might be needed.
Most personal auto insurers in the US do not cover drivers working for ridesharing or delivery services without adding a rideshare endorsement, as doing so would constitute business activities and therefore would void your policy’s payout on any claims you might make against it.
But if you add rideshare insurance to your personal policy, most major car insurers provide cover when making deliveries for services such as Uber, Lyft, Instacart and DoorDash. This coverage may come as either a standalone policy or as an add-on option to existing coverage.
Providers’ coverages vary, but most include liability insurance that pays for medical costs and property damages caused to others by you. Comprehensive and collision policies offer optional add-on coverages in case your car is damaged during an accident; comprehensive and collision policies offer coverage if the damage exceeds repair.
Uber and Lyft go beyond basic liability coverage by also offering contingent collision and comprehensive insurance. This coverage only becomes active once an app user is matched with a passenger; however, each policy carries a $2,500 deductible which means any payments made under their policy must first come directly out of pocket first before any reimbursements come through on your behalf.
If your insurer doesn’t offer ridesharing endorsements, comprehensive and collision coverage policies are available that will cover you while working for ridesharing services like Uber Eats or Amazon Flex that don’t offer rideshare endorsements; in such cases it will be necessary to purchase separate policies to meet their specific car requirements, typically four-door cars with independently opening doors as well as factory installed seatbelts for at least four passengers delivering for them.
When involved in an accident with another vehicle owned by someone else, collision coverage can help cover repair costs. While your personal auto policy typically doesn’t provide such protection, UK Private hire taxi insurance explained here by Business Review provides this crucial extra layer of security.
Uber and Lyft each provide drivers with limited commercial insurance policies, covering only periods when they have their app open and waiting for a ride request or in between trips. In case an accident does happen during these periods that is denied coverage by Uber or Lyft or their personal policies (without rideshare endorsement) then an independent contingent commercial policy exists which provides up to $50,000 per person and $100,000 for property damage compensation coverage.
Although rideshare insurance policies exist, they can be hard to come by. Each insurer weighs different factors differently when setting rates; also, terms and conditions of these policies can often be unclear and confusing.
Therefore, it is crucial that you speak to an experienced agent in order to ascertain which types of coverage are available and how much is necessary as an Uber or Lyft driver. Depending on your state’s laws and your specific rideshare driver work environment, additional steps might include acquiring a commercial driver’s license.
Additionally, drivers should carry comprehensive and collision coverage. Although often available as optional add-ons to a personal auto policy, comprehensive and collision policies are highly recommended by experts for Uber drivers as it helps cover injuries to other people or property in an accident they caused. Liability coverage is typically required in all states but comprehensive/collision may cost more; nonetheless it should still be carried – liability covers injuries to others or their properties resulting from your negligence in an accident while comprehensive and collision can provide valuable coverage; both may not be affordable to full-time Uber drivers but can provide valuable extra income-generating opportunities – making collision/completion an invaluable addition for Uber drivers looking for extra income opportunities!