How Driving for Uber and Lyft Affects Car Insurance Rates
Rideshare drivers pay about 28% more for car insurance than non-rideshare drivers.
Excellent
Why you can trust Insurify: Comparing accurate insurance quotes should never put you at risk of spam. We earn an agent commission only if you buy a policy based on our quotes. Our editorial team follows a rigorous set of editorial standards and operates independently from our insurance partners. Learn more.
If you drive for a transportation network company (TNC), like Uber or Lyft, it’s important to protect yourself financially with rideshare insurance. A rideshare insurance policy fills the gaps between your personal car insurance and the TNC’s insurance for greater financial protection.
The average rideshare driver pays $270 per month for car insurance, which is slightly higher than the average premium for non-rideshare drivers. But you can reduce the cost of car insurance in a few ways.
Here’s what you need to know about how driving for TNC companies affects car insurance costs.
How much rideshare insurance costs
The average rideshare insurance premium is $270 per month. By comparison, the average premium for a non-rideshare driver is about 28% lower, at $211 per month.
Rideshare drivers pay higher rates for coverage because they’re riskier to insure. Uber and Lyft drivers often travel further distances, drive more frequently, and are more likely to drive in densely populated areas than non-rideshare drivers. These factors can increase the chance of an accident or other claim, which leads to higher premiums.
Cheapest car insurance for rideshare drivers
Some car insurance companies offer cheaper rideshare insurance than others. Based on Insurify’s rate data, USAA, GEICO, and Erie are a few of the cheapest rideshare insurance companies.
You can see the cheapest car insurance for TNC drivers and their average monthly premiums below.
Best Uber/Lyft insurance companies
Many reputable car insurance companies offer rideshare insurance to Uber and Lyft drivers, but the following insurers are some of the best overall.
GEICO: Best for affordable rates
USAA: Best for military families
Erie: Best for customer satisfaction
To pick the best car insurance companies for Uber and Lyft drivers, we looked at third-party ratings for overall customer satisfaction, claim satisfaction, and financial strength. We also studied each company’s complaint index from the National Association of Insurance Commissioners (NAIC). Other factors we considered included rideshare insurance costs, customer service options, discounts, and state availability.
How car insurance works for Uber and Lyft drivers
You can add a rideshare insurance endorsement to your personal car insurance policy. It fills the coverage gap during phases of the trip where your personal car insurance and the rideshare company’s insurance don’t apply or provide limited coverage. You typically need to purchase rideshare insurance from the same company that provides your personal auto insurance policy.
Here’s how insurance works during each phase of the trip:2 3
Phase 1: In phase one, you’re driving for personal use, and the rideshare app is off. During this phase, only your personal car insurance applies.
Phase 2: In phase two, you’re driving with the rideshare app turned on, and you’re waiting to receive a ride request. During this phase, the TNC’s insurance policy covers third-party liability. If you have rideshare insurance, the coverages you carry on your personal policy, like collision insurance, comprehensive insurance, and uninsured motorist insurance, will also apply during phase two.
Phase 3: In phase three, the rideshare app is on, and you’re either driving to pick up a passenger or you’re transporting a passenger. The Uber or Lyft insurance policy automatically covers third-party liability. If you carry full coverage on your personal auto policy, Uber and Lyft both provide contingent comprehensive and collision coverage with a $2,500 deductible. Rideshare insurance can help cover this deductible if you have a claim.
Types of car insurance coverage for rideshare drivers
Rideshare drivers need to carry certain types of insurance coverage. The following types of car insurance are usually mandatory for Uber and Lyft drivers.
Some optional policies can also benefit rideshare drivers, including:
How to lower car insurance costs for rideshare drivers
Rideshare drivers can use these tips to reduce their car insurance costs:
Ask your insurance company about discounts. Many insurance companies offer discounts for car insurance customers. Find out if discounts are available for rideshare insurance, such as for taking a defensive driving course.
Bundle your policies. You can typically save money when you bundle rideshare insurance with another policy, like home insurance.
Maintain a clean driving record. Rideshare drivers with a clean record usually pay the lowest rates for coverage. To maintain a low rate, avoid tickets and accidents.
Choose higher deductibles. Raising your deductibles for collision and comprehensive can reduce your monthly premium for rideshare insurance.
Shop around and compare rates. To find the cheapest rideshare insurance, compare quotes from a few different insurers. Consider switching car insurance companies if you can find a cheaper rate from another insurer.
Uber and Lyft car insurance rates FAQs
Rideshare insurance offers important protection for Lyft and Uber drivers. Learn more about how driving for a TNC can affect your car insurance premium.
If you drive for Uber once, will your insurance go up?
No. If you drive for Uber one time, it won’t have an effect on your car insurance premium. Driving for Uber doesn’t directly affect your auto insurance rate.
But if you purchase rideshare insurance, it’ll cause your premium to increase, regardless of how often you drive for Uber or another TNC.
What if I don’t tell my insurer about my rideshare driving?
If you don’t tell your insurance company that you drive for Uber or Lyft, a few things can happen. If you have an accident while ridesharing, your insurer might not cover your claim. It’s also possible that your insurer could cancel or non-renew your policy if you drive for Uber or Lyft without telling them.
How much is rideshare insurance?
The average cost of car insurance with a rideshare endorsement is $270 per month, or $3,240 per year. To compare, the average insurance premium without rideshare coverage is $211 per month, or $2,532 per year.
Insurance companies personalize rideshare insurance premiums based on factors like your location, insurance company, vehicle type, and driving record.
What is Uber’s optional insurance?
Uber offers Optional Injury Protection insurance for all drivers. It can help cover unexpected medical bills and lost income if you get into an accident. Uber’s Optional Injury Protection includes up to $1 million in coverage for medical expenses and up to $500 per week in wage replacement. It also pays survivor benefits if you have a fatal car accident while ridesharing.
Does rideshare insurance also apply to delivery services?
Rideshare insurance applies to some delivery services, like Grubhub and DoorDash, but it doesn’t cover all delivery drivers. For example, rideshare insurance doesn’t cover people who use their personal vehicles to deliver full-time or drivers who use a company-owned vehicle to make deliveries. In these situations, they’d need commercial auto insurance.
)
)
)
){kind=small}
){kind=small}
)
)