Rideshare Insurance: What It Covers and When You Need It
If you drive for Uber, Lyft, or another transportation network company, you may need to purchase rideshare insurance.
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Driving passengers and delivering food for companies like Uber, Lyft, and DoorDash have become popular ways to earn money. However, many drivers are surprised to learn that their standard auto policy won’t cover them for accidents that occur while working for a rideshare company.
Enter rideshare insurance, which offers financial protection if you get into an accident while transporting passengers.
Here’s what you need to know about this unique coverage.
How rideshare insurance works for Uber and Lyft drivers
Rideshare insurance can help bridge the gap between what’s covered under a rideshare company, such as Uber or Lyft, and what’s covered under your personal auto policy. Rideshare insurance isn’t included in a standard auto insurance policy. Instead, rideshare insurance is offered as an endorsement to your standard policy or as a separate policy.
Uber and Lyft offer different levels of coverage depending on the phase you’re in when an incident occurs. Here’s a breakdown of the different phases and what’s covered in each.
Phase 1: Driving for personal use with rideshare app turned off
Uber and Lyft: No coverage offered. Your personal auto insurance policy applies.
Phase 2: Driving with rideshare app turned on but no request for a ride yet
Uber and Lyft: Both offer third-party liability insurance for covered accidents in the following amounts. Note that this insurance only kicks in if your personal auto coverage doesn’t apply.
$50,000 per person for bodily injury
$100,000 per accident for bodily injury
Note that coverage limits vary by state.
Phase 3: Either driving to pick up a passenger or driving the passenger to their destination
Uber: The following coverage is available to Uber drivers in the event of a covered accident:
$1 million liability insurance
Uninsured motorist coverage, underinsured motorist coverage, and first-party injury insurance
Contingent comprehensive and collision up to the actual cash value of the vehicle, with a $2,500 deductible2
Lyft: Lyft offers drivers the following coverage if they’re involved in a covered accident:
A minimum of $1 million liability insurance
First-party coverages, including uninsured motorist coverage, underinsured motorist coverage, personal injury protection, medical payments, and occupational accident coverage
Contingent comprehensive and collision coverage up to the actual cash value of the vehicle with a $2,500 deductible. This coverage is only available if you carry comprehensive and collision on your personal auto policy.
Do you need rideshare insurance?
Most personal car insurance policies won’t cover you while using your vehicle for business use, including rideshare driving. Purchasing rideshare insurance is essential to bridge any potential coverage gaps, and it allows you to feel confident on the road.
Here are some of the major insurers that offer rideshare insurance as either a supplemental or commercial insurance policy:
Progressive
Allstate
USAA
State Farm
Farmers Insurance
Mercury
American Family
Travelers
What to know about delivery driver insurance
You may also need delivery driver insurance if you use your car to deliver food through companies such as Uber, Instacart, and DoorDash. Delivering food using your car is considered a business use instead of a personal use. Therefore, your personal auto policy may not cover any associated claims.
Though some rideshare companies offer insurance for delivery drivers, the coverage is limited. For example, Uber offers the following coverage for delivery drivers on its platform:
Offline or the driver app is off:
Your personal auto insurance coverage applies.
Available or waiting for a delivery request:
$50,000 in bodily injury per person
$100,000 in bodily injury per accident
$25,000 in property damage per accident
En route to pick up deliveries and during trips:
$1 million liability insurance
Contingent comprehensive and collision coverage up to the actual cash value of the car with a $2,500 deductible2
Note that rideshare companies may not offer insurance to delivery drivers in all states. For example, Uber’s delivery driver coverage excludes accidents that occur in New York state.
How much does rideshare insurance cost?
The cost of rideshare insurance depends on several factors, including your location, insurer, driving record, and coverage limits. It also depends on the type of rideshare insurance you purchase.
A rideshare endorsement is typically the most cost-efficient; however, availability varies by state and insurance company. In some states, your only option for rideshare insurance is a commercial auto policy, which is more expensive than an endorsement.
One of the best ways to find an affordable rideshare insurance policy is to shop around. An insurance-comparison website can help you compare quotes from multiple insurers in one place.
Rideshare driving requirements in your state
You must meet certain requirements to drive for rideshare companies, such as Uber and Lyft. Here’s a list of general requirements, which vary by state.
Uber driver requirements:
Meet your city’s minimum driving age requirement
Have at least one year of licensed driving experience in the U.S.
Drivers younger than 25 must have at least three years of licensed driving experience in the U.S.
Have a valid in-state license
Must use an eligible four-door vehicle
Provide proof of residency in your city, proof of vehicle insurance, and a picture for your Uber driver profile
Complete a driver screening, which includes a review of your driving record and criminal history
Lyft driver requirements:
Meet the minimum driving age in your state and have a valid license
Complete a background check
If using your own vehicle, upload proof of insurance and registration
Have a four-door vehicle or rent a car through Express Drive3
You can learn more about rideshare insurance requirements in your area by visiting the state pages below.
What to do if you get in an accident while driving for Uber or Lyft
If you get into a car accident while driving for Uber or Lyft, you’ll need to follow a few general steps.
Here’s what to do in the event of an accident, according to Uber:
Ensure that everyone involved in the crash is safe.
Contact the police and an ambulance if necessary.
Inform Uber about the crash.
Fill out the Uber claims form.
If you want to file a claim following an accident while driving for Lyft, you must complete an accident report.
Rideshare insurance FAQs
Driving for a rideshare program isn’t as easy as it seems. Here are some commonly asked questions to help get you started.
How much does rideshare insurance cost?
The cost of rideshare insurance depends on several factors, including your driving record and the coverage requirements in your state. Generally, you can expect to pay anywhere from $119 to $300 for rideshare insurance.
Do you need to tell your insurance company you drive for Uber?
Generally, you must give your insurance company a heads-up if you begin driving for rideshare companies, including Uber and Lyft. If you don’t notify your insurer, it may be grounds for policy cancellation and you leave yourself financially vulnerable in the event of an accident.
Do you need rideshare insurance in New York?
Purchasing rideshare insurance isn’t a legal requirement in New York. However, it’s generally recommended to ensure adequate protection in the event of an accident. You can learn more about specific state requirements in the linked state pages included in this article.
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