Rideshare Insurance: How to Bridge the Coverage Gap

When you drive for a living, your personal car insurance policy might not cover some of the damages that may occur during the ride. That’s where rideshare insurance comes in.

Whether you’re working for a rideshare service like Uber or Lyft or using your car to make DoorDash deliveries, insurance coverage cannot be overstated. When your livelihood depends on a good working vehicle, get peace of mind that you’re covered under all conditions — on and off the clock.

What is Rideshare Insurance?

Rideshare insurance is a type of coverage that bridges the gap between your personal auto insurance policy and a commercial auto insurance policy. While you likely have personal auto insurance, as well as some level of coverage from the companies you contract with, rideshare insurance makes your existing coverage more comprehensive and prevents coverage gaps.

As a rideshare driver, you’re considered an independent contractor, not an employee. That means your personal auto insurance policy may not cover you when you’re on the job. You could be held responsible for damages and injuries that occur while you’re working. Most personal auto policies exclude all coverage while preforming delivery or livery services.

Rideshare insurance can bridge this gap by including liability coverage, which can help pay for damages if you’re found at fault in an accident.

When Does Rideshare Insurance Kick In?

Let’s say you drive for Lyft. Your app is off and you’re transporting yourself to the grocery store. In this case, your personal auto policy will cover you in the event of an accident.

If you were driving someone else to the grocery store via the Lyft app and you were in an accident, Lyft’s policy should cover the damages. The same holds true if you accepted a request and are enroute to pick up a paying passenger.

Now, let’s say your app is on and you’re waiting for a request and someone rear-ends you. In this case, your personal auto policy would not be responsible unless you have rideshare coverage.

Similar circumstances hold true with delivery app companies.

Because of these gaps in coverage, you’ll need rideshare insurance to maintain proper coverage at all times.

How does driving for a Rideshare company differ from delivering food/goods from a store you’re employed by?

When you drive for a Rideshare company you are a contractor, unlike when you work for a company as an employee (i.e., Pizza Hut, Walmart, local Chinese Restaurant). The relationship between the person working for the company differs based on your classification.

When you are an employee and are driving for one particular store, you are considered a commercial delivery driver and will be required to obtain commercial insurance for your vehicle, even if it is your personally owned vehicle.

Many times, this comes into play with restaurant delivery drivers, newspaper delivery, rural mail carriers, flower shops, etc.

The coverage provided by some rideshare companies covers their drivers while they are carrying passengers or delivering goods, but not all companies commercial policies will extend over to their drivers. It is crucial to know where you stand and what coverage is available to you.

How Much Does Rideshare Insurance Cost?

In most cases, you can add rideshare coverage to an existing personal auto policy. The costs can vary by carrier, your driving record, and where you live. Many of our carriers like Travelers, Allstate, and Progressive offer the coverage as an add on, or endorsement. Instead of having a rideshare endorsement on your personal auto policy, you can also opt for a commercial auto policy. Typically, commercial auto policies for delivery services are more expensive, leading customers to add rideshare coverage onto their personal policies when applicable.  

At the end of the day, the cost of adding rideshare coverage will be far lower then having a claim denied and having to pay expenses out of pocket.

Where to Get Rideshare Insurance

If you drive for a living, or even just as a side hustle, it’s a good idea to have rideshare insurance on your personal auto policy. It can give you peace of mind knowing that you’re protected financially if something happens while you’re on the job.

Our agents give you the best advice when it comes to rideshare coverage from some of the most trusted names in insurance. Because we’re brokers, we do not force you into only one offering or carrier option, so you can rest assured you get the most coverage for the best possible rate. Contact us today for a free quote!

Disclaimer: Determinations for when various rideshare companies like Uber, Lyft, DoorDash, etc. will provide insurance coverage for its passengers and drivers should be confirmed by the companies themselves. This also applies for when their insurance coverage begins and ends, and at what limits they are providing coverage.

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