Rideshare Insurance
Rideshare Insurance Coverage for Uber, Lyft, and other Transportation Network Companies (TNC)
Over a million drivers are providing transportation for rideshare companies such as Uber and Lyft combined.
To make sure you’re adequately protected, you’ll need to look into getting rideshare insurance coverage
With an individual policy, you wouldn’t be insured using your car for business purposes.
Rideshare insurance is a type of commercial auto insurance coverage designed for TNC drivers.
What is Rideshare insurance?
Uber and Lyft offer a $1 million in liability coverage during the ride itself. It covers you from the time you pick a passenger up to the time you drop them off.
But what happens when you're just sitting there, waiting for a rideshare customer? That's a different story.
During Period 1, their coverage drops down to a mere $50,000 for bodily injury per person, and $100,000 BI per accident, and $25,000 for property damage.
Uber and Lyft don’t provide collision or comprehensive coverage at all . To make matters worse, your own auto insurance policy won't do anything to help out either because you're using your vehicle for a commercial purpose.
That's where a rideshare endorsement kicks in to fill the gap.
When would you need a Rideshare insurance endorsement?
If you drive for Uber, Lyft or delivery services like Door Dash, Uber Eats , Grubhub or Instacart you are going to need a rideshare endorsement.
Now Illinois doesn't actually require you to get one but forget buying a policy that covers you if you drive without it.
Without a separate policy, that means you'll be stuck relying on Uber or Lyfts limited Period 1 coverage ( $50K/$100K/$25K ). If you get into an accident you'll have to pay a $2500 deductible on top of that .
Some states though, like California and Colorado, actually make it a requirement for TNC drivers to carry a minimum level of coverage.
How does Rideshare Insurance work?
If you’re a regular rideshare driver, then it’s imperative to know when those rideshare insurance gaps may occur when you’re working. Technically, you’re on the work clock when you turn on your Uber and Lyft app.
Here are some times (or periods) of ridesharing and the rideshare coverage provided:
Period 0
You’re simply in your car, and your Uber and Lyft app is turned off. Unless you turn on the app, then you’re covered by your personal policy and not rideshare coverage.
Period 1
You’ve turned on your Uber and Lyft app and are waiting for a ride request. You may be driving around for this part.
If any accident happened during this time, you might not be covered under your personal policy because you are driving for business purposes, and the rideshare coverage provided by the ridesharing company may be limited.
Period 2
A ride request came through the Uber and Lyft app, and you’re on your way to pick up your customer. At this point, the coverage provided by the rideshare company starts and you’re covered for this period.
Period 3
The passenger has entered the car, and you’re driving them to their destination on the app.
Your rideshare coverage from the TNC company still covers you at this point. You’re on the job and transporting a customer. As you can see, the car insurance gap is in period 1.
What’s the difference between commercial auto insurance and rideshare?
Commercial auto insurance costs $150-$300 per month and covers all business use of your vehicle, not just driving for Uber or Lyft. A rideshare endorsement costs only $5-$30 per month and only applies when your rideshare app is active.
Chose a commercial auto insurance policy is you drive more than 30 hours a week for Uber or Lyft, use your car for other business purposes, or your state requires it for TNC drivers.
Choose a rideshare endorsement if you drive part time for Uber and Lyft (under 20 hours) and only need coverage when the app is on.
How do I get Rideshare Coverage?
Rideshare Insurance - it's available to add on to your existing auto insurance policy or buy as a completely separate policy. Though its not a feature that all insurance companies offer - a number of major carriers do, including Progressive, State Farm, Allstate, Geico , Farmers, and USAA.
Adding a rideshare endorsement can cost anywhere from $5 to $30 extra per month. The price depends on your state and your insurance company. Depending on where you live in Illinois for example, a Progressive rideshare endorsement might cost you $15 to $20 a month, while an Allstate one will run about $20 to $25 a month.
To get yourself covered you'll need to:
Find out if your current insurance provider offers a rideshare endorsement to begin with - if they don't you might need to switch to a different insurance company or get a whole new commercial policy.
Tell your insurance company about your rideshare driving - don't be afraid to keep them in the loop - or they might just cancel your policy on the spot. Its worth noting , if you're in an accident in that first period (the time between when you're on the clock and when you pick up your first passenger) and the insurance company finds out you were driving for a TNC without telling them they might be able to void your policy all the way back to the start - leaving you to pay out of pocket for any damages you may have caused.
Make sure your rideshare endorsement has a deductible that stacks up against Uber/Lyft deductibles when you get into an accident. For example, Uber and Lyft both have deductibles of $2,500 for comprehensive and collision claims. You'd think the same would apply for your personal rideshare endorsement - unfortunately a lot of the time it doesn't - most of the time your own deductible will be anywhere from $500 to $1,000 - that can save you $1,500 to $2,000 on a claim.
Make sure your policy covers Period 1 - the time between when you turn on the app and when you pick up your first passenger - thats the period when you're most vulnerable to gaps in coverage. Some endorsements only cover periods 2 and 3, so just make sure yours takes care of that first period for you.
Get a Quote Online from Insurance Navy or visit our convenient locations today.
Popular Areas we offer Rideshare insurance