Driving for Uber or Lyft is a great way to make a little extra money, especially since there are very few limitations regarding the vehicles and drivers that are eligible to drive for those companies. Although both companies do require that you have your own insurance on your vehicle, many people don’t really know when their insurance stops covering them and when Uber or Lyft’s insurance starts covering them.
Generally speaking, as soon as you log into the Uber or Lyft app, your auto policy stops extending coverage since you are now driving for financial gain. Since you are driving more frequently than the average commuter that only drives to and from work most days, the risk associated with driving for a “Rideshare” company is very different. Because of that additional risk, most auto insurance policies exclude coverage for driving for hire.
Though most auto policies exclude coverage for driving for Uber or Lyft, many insurance carriers now offer a Rideshare Endorsement that you can add to the policy. In most cases, Rideshare coverage is fairly inexpensive, and it covers a gap that would otherwise leave you exposed. If you do not have the proper coverage and you get in an accident while driving for Uber or Lyft, not only could you be left without coverage for the damage, your personal auto policy may also be cancelled for violating the terms and conditions.
The best way to find out if your policy offers Rideshare coverage is to call your agent and ask. If that endorsement is not offered by your insurance carrier, it is important that you find a policy that does offer it. We write with at least 5 different companies that offer Rideshare coverage, so there are certainly options available.
There are very specific guidelines regarding what coverage is provided, and by which company, depending on where you are at in the process. Whether you have the app on and are waiting for a fare, you are driving to pick up your passenger, or you have your passenger in the vehicle, there are conditions in place to determine what coverage will extend.
The coverage that Uber or Lyft offers is fairly limited until you have actually accepted a fare and are going to pick up a passenger. With most insurance carriers, if you have a Rideshare Endorsement on your personal insurance policy, the policy will extend coverage for the period of time that you are logged into the app but have not yet accepted a fare. That means that all of the coverages that you have on your policy for your normal day-to-day use would extend during that period of time, which bridges the gap between your coverage and the coverage provided by Uber or Lyft.
Once you have accepted a fare and you are on your way to pick up the passenger, your personal policy will no longer extend coverage, even if you have the Rideshare endorsement. One reason for that is because once you have additional people in the vehicle, the liability risk is much greater. Not to worry though, the coverage offered by Uber or Lyft increases significantly once you have accepted a fare, and you no longer need to bridge that coverage gap.
**Please note that not all insurance policies are the same. The information provided above is based on the insurance carriers that we are appointed with, but coverage may vary with other insurance carriers. If you have questions about the coverage on your policy, please call your agent.
Here is a breakdown of when your policy extends and when Uber or Lyft’s policy extends:
If you are not logged into the app and are using your vehicle for personal use:
Your personal policy covers you.
Uber/Lyft policy does not extend.
If you are logged into the app, but have not yet accepted a fare:
Uber/Lyft policy offers only liability coverage if you are at-fault for an accident. Their policy does not extend comprehensive or collision coverage for damage to your vehicle, or uninsured/underinsured motorist coverage if you are injured.
Maximum Limits offered:
$50,000/Maximum Person, $100,000 Maximum per Accident for bodily injury caused to others.
$25,000 Maximum limit per accident for property damage caused to others
Your personal policy extends with the same coverages and limits you have for personal use, as long as you have the Rideshare endorsement on your policy
- Once you have accepted a fare and are driving to pick up the passenger, and during the trip with the passenger:
- Your personal policy will not extend any coverage.
- Uber/Lyft policy offers liability coverage, uninsured/underinsured motorist coverage, and comprehensive and collision coverage.
- Coverage Limits offered:
- $1 Million per occurrence for liability coverage, which includes both bodily injury and property damage.
- Uninsured/Underinsured Motorist coverage, which is for your bodily injury if you are not-at-fault but the other driver does not have insurance or does not have enough insured. Limits vary by state.
- Comprehensive and Collision Coverage- only extends if you have those coverages on your personal policy. These are the coverages that extend to cover damage to your vehicle.
- Uber has $1000 Deductible.
- Lyft has up to $2,500 Deductible.
- Coverage Limits offered:
**The coverages listed above are as based on information provided on the Uber and Lyft websites as of 2/22/2019, please note that these coverages may change over time.
For more information regarding the coverage offered by Uber or Lyft, you can visit their websites:
- Lyft: https://help.lyft.com/hc/en-us/articles/115013080548-Insurance-Policy
- Uber: https://www.uber.com/drive/insurance
If you're a current Uber or Lyft driver, or plan to be in the future, let us review your current coverage and provide you a new quote. We'll compare over 20 companies so you can make the right choice.