Not about the 9-to-5 life and looking for a steady income, or just trying to pick up a side hustle? With ridesharing apps gradually becoming household names, an increasing amount of people have signed up to drive for these companies. Since Lyft and Uber offer flexible hours and the opportunity for tips, it’s become a desirable way to make some extra cash.

Ridesharing companies have used various techniques to draw in new drivers (i.e. the $350 bonus you are eligible for in your first 30 days with Lyft). While this large cash amount might draw in anyone living in a heavily populated area with a car, what isn’t advertised as freely is each company’s approach to insurance. Information about their insurance policy just isn’t glamorous enough to make it onto the colorful ads, it seems.

Before you sign up to drive for Uber, Lyft or a similar ridesharing company, make sure you look into the technicalities regarding insurance policies. If you have to pay a little out of pocket, is that something you feel comfortable with? Read on to find answers to some of the questions you might have about how working with Uber or Lyft will affect your insurance policy.


“Do I need rideshare insurance?”

If your rideshare company provides insurance, make sure it covers you for the whole ride; some coverages only apply when you’ve accepted a pick-up. This means anytime you’re driving and waiting for someone to request a ride in your area, you won’t be covered if you get into an accident. For instance, Lyft covers a driver’s liability while they’re on driver mode, but only covers collision and comprehensive after a driver accepts a ride request. Do your research to see if you need to purchase rideshare insurance for coverage when you’re waiting for passengers.


“But my state doesn’t have rideshare insurance!”

If rideshare coverage isn’t available yet in your state, you should gain coverage from a commercial insurance policy. These policies are pricey but may be necessary to keep you protected.


“Do I need to contact my personal insurance company?”

If you haven’t already, contact your personal auto insurer to let them know that you drive for a ridesharing company. If your company finds out before you tell them, they could remove your personal policy, as they view this as withholding personal information.


“How do I get rideshare insurance?”

Rideshare insurance is not sold as a stand-alone coverage. You’ll need to get rideshare insurance through your personal auto insurance company.


“What if I get into an accident?”

If you get into an accident before accepting a ride request, you’ll need to file a claim with your insurance provider. This is where rideshare insurance is essential; Uber and Lyft will give you minimal assistance in this instance.


“What if I get into an accident with passengers in the car?”

If you’re involved in an accident while passengers are in the car or while you’re on your way to pick up customers, Uber and Lyft will help you out. Both Uber and Lyft cover damage and medical expenses up to $1,000,000 no matter your person insurance plan. Collision and comprehensive insurance is where your personal policy matters at this time; you can utilize Uber or Lyft’s collision and comprehensive coverages if you have these policies on your own auto insurance. Don’t take this lightly, however, as deductibles for their policies are high, at $1,000 for Uber and $2,500 for Lyft.


“How would I file a claim for an accident while ridesharing?”

You’ll need to file a claim with your personal auto insurance company, whether the ridesharing company will cover the damage or not; your insurer will need to know about any accidents on your record. In addition, call your ridesharing company’s insurer if the accident can be covered by them; from here, a representative should be able to assist you and walk you through the process.


“What are the most reliable insurers for ridesharing insurance?”

While this varies based on your state, vehicle, age, and driving history, there are a few companies that are considered to have the best coverage for Uber or Lyft drivers. Geico, Erie Insurance, Farmers Insurance Group, Allstate, and State Farm are considered to have the most reliable policies for ridesharing drivers. These 5 companies don’t offer ridesharing insurance in every state, so make sure you find the best policy for you.


Before locking down this gig, ensuring that you’re comfortable paying a little out of pocket is essential. In addition, be aware that you’ll be paying pretty steep deductibles following accidents. Yes, you’ll reap the benefits of flexible work time, tips from the kindest of passengers and the trade-in of your cubicle for your sedan, but don’t be surprised if you get hit with a big bill if you get into an accident. Don’t say we didn’t warn you!