How Car Insurance Works for Rideshare Drivers

Rideshare drivers typically use their personal vehicles to transport passengers, so they must have personal auto insurance. However, personal auto insurance policies often exclude coverage when the car is being used for commercial purposes, such as ridesharing.  Rideshare insurance is designed to fill the gaps between personal auto insurance and the coverage provided by the rideshare company.

Most rideshare companies, like Uber and Lyft, offer some insurance coverage for their drivers, but this coverage varies depending on the driver’s status at the time of an incident. For example, when the rideshare app is off, the driver’s personal auto insurance is in effect. When the app is on, but the driver has not yet accepted a ride, the rideshare company’s contingent liability coverage typically applies. Once a ride is accepted and the driver is en route to pick up a passenger or has a passenger in the car, the rideshare company’s primary liability coverage usually takes over.

Supplemental Rideshare Insurance

While the insurance provided by rideshare companies offers some protection, it may not be sufficient in all situations. This is why many rideshare drivers opt for supplemental rideshare insurance. Supplemental rideshare insurance policies are designed to provide additional coverage, bridging the gap between personal auto insurance and the company’s coverage.

These policies can offer benefits such as higher liability limits, coverage for physical damage to the driver’s vehicle, and protection for medical expenses.

Some personal auto insurance companies now offer rideshare endorsements, which can be added to an existing policy to provide coverage when the rideshare app is on but no ride has been accepted. This can be a cost-effective way for drivers to enhance their coverage without purchasing a separate policy.

Learn More

Contact Samco Agency to evaluate your current auto insurance and get a rideshare coverage quote.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.