Rideshare Insurance: What Uber, Lyft, and Other App Drivers Need to Know

If you’ve just signed up to become a rideshare driver and passed a background check and vehicle inspection, you might not want to fire up the app and start accepting ride requests immediately. Accidents happen to even the most cautious, experienced drivers, so understanding what rideshare insurance is and if you need it is essential.

Here’s what you need to know.

Understanding Rideshare Insurance

Rideshare drivers use their vehicles to drive customers of rideshare apps like Uber and Lyft where they need to go. While it sounds simple, the job can get complicated regarding insurance.

Drivers often have personal car insurance covering them when they aren’t driving customers around. Likewise, rideshare companies provide insurance coverage when passengers are in the car. However, neither policy is in effect when a rideshare driver uses their app to look for a passenger.

Drivers must purchase rideshare insurance to safeguard against this gap. If a driver without rideshare insurance gets into an accident while waiting for a customer, they could be financially responsible.

Types of Rideshare Insurance

When you decide to get rideshare car insurance, you’ll have several types of coverage to choose from. Insurance for rideshare drivers can be an extension of your personal car insurance policy or a standalone policy.

Here are some of the basic coverages:

• Liability coverage: When you damage another person’s property or cause injuries, your liability coverage will kick in. Liability coverage protects at-fault drivers.
• Collision coverage: Accidents happen, making collision coverage important. This insurance covers you if you get hit by another car, crash into a tree, or damage your vehicle because you drove over a pothole. Collision coverage pays for the damages to your car regardless of who is at fault.
• Comprehensive coverage: Comprehensive coverage protects you from things out of your control, like thieves, falling rocks, fires, or deer. Comprehensive coverage will give you peace of mind when you’re off the road.
• Personal injury protection (PIP): Accidents often result in injuries. Liability coverage will pay for the injuries of others but won’t cover you, but PIP insurance will.

Supplemental Policies

Supplemental policies are additions to your personal coverage that increase your protection. A rideshare endorsement is an add-on that extends your insurance to when your app is on but you haven’t accepted any rides. This coverage will vary by provider.

For example, Progressive rideshare insurance will add comprehensive and collision coverage on top of the liability coverage provided by the rideshare company. Other providers may extend your coverage until the rideshare company insurance takes over.

Commercial vs. Rideshare Insurance

Commercial auto insurance and rideshare insurance aren’t the same, and knowing the difference is key.

Commercial insurance fully covers you and your vehicle when you’re working, which could be a rideshare, delivery, or other driving-related job. Rideshare insurance only covers you when picking up or driving a passenger.

Both commercial and rideshare insurance don’t cover personal driving unless specifically added. Commercial insurance is the more expensive option.

How Rideshare Insurance Works

The insurance provided to drivers by companies like Uber and Lyft usually has high deductibles and limitations. The coverage depends on specific scenarios.

• There is no coverage if the driver isn't using the rideshare app.
• The company only provides liability coverage of $25,000 for property damage, $50,000 for individual bodily injury, and $100,000 for total bodily injury if the driver causes an accident while logged in but not picking up or driving a customer.
• If the driver is en route to pick up a customer and there is an accident, they receive $1 million in liability coverage.
• If a customer is in the car during an accident, the driver gets $1 million for liability coverage and may get uninsured motorist coverage.

In contrast, traditional insurance coverage insures drivers when they aren’t working or logged into a rideshare app.

If you drive for a delivery service like GrubHub or DoorDash, your coverage will differ from Uber and Lyft and vary based on the company. For example, DoorDash may provide coverage if an accident leads to bodily injury or property damage. However, the accident must occur during active delivery time, and the coverage is only possible if the driver’s primary coverage denies the claim. GrubHub doesn’t provide driver coverage but has limited occupational accident insurance for injuries that occur during an active delivery.

Costs and Factors Affecting Insurance

The cost of rideshare insurance for drivers varies depending on your provider. These factors will also play a part in how much you pay:

• Amount of coverage
• Vehicle type
• Vehicle security
• Driving history
• Work schedule
• Mileage
• Location
• Claims history

You’ll need to speak with the provider to get an exact quote for your premium, but you can also look up car insurance quotes online for a general idea.

Steps To Ensure Comprehensive Protection

To make sure you’ve got the protection you need, take these steps before choosing a policy:

1. Consider your personal insurance and the amount of time you’ll spend driving to determine your personal liability needs.
2. Learn what coverage the rideshare or delivery company will provide while you’re working.
3. Check if your personal provider will give you a rideshare endorsement or hybrid policy to cover the coverage gap.
4. If not, research and compare different insurance providers and coverages and choose the best one.

Once you’ve got comprehensive protection, check for car insurance discounts to see if you can get additional savings.

Finding the Right Provider for You

Being a rideshare driver shouldn’t mean taking risks that could cripple you financially. Find the best rideshare provider and coverage with EverQuote. At EverQuote, you can compare insurance companies, policies, and prices to find the best coverage.

Visit EverQuote today for full rideshare coverage at an affordable price.

FAQs About Rideshare Insurance

The best provider for rideshare insurance depends on your needs and the providers available in your state.