Do You Need Special Insurance to Drive for Uber and Lyft?

Are you considering driving for services like Uber and Lyft to help supplement your income? It can be a good plan that can help you meet your financial goals while holding on to your day job.

If so, you’ll want to make sure you have the right kind of rideshare insurance protection so that your vehicle (no pun intended) to your financial dreams doesn’t become a monetary albatross.

Most traditional auto insurance policies specifically exclude activities related to ridesharing programs like Uber and Lyft. So, yes, you do need special insurance if you intend to drive for a rideshare service.

Buying Auto Insurance from Rideshare Companies

Rideshare drivers do have the option of purchasing commercial auto policies. While these policies do offer a wider range of protection for drivers, they are often too costly to justify the earnings the average rideshare driver makes.

A recent solution by rideshare organizations was to offer more affordable policies that provided limited protection to drivers. The problem with this coverage is that the deductibles can be costly for drivers and that the coverage is very specific providing protection only when drivers are on their way to pick up passengers or have passengers in their vehicles. It specifically excludes time when drivers are in their vehicles with the app on waiting for someone to order their service.

Another issue is that personal auto policies don’t cover this period of time either, which is why there is a protection gap that is best addressed with a policy to cover rideshare drivers.

Finding the Right Rideshare Insurance Coverage

While Uber and Lyft both offer insurance through third parties, the insurance products they offer are mostly inferior to the type of coverage you need. There are a few elements you need to look for when purchasing rideshare insurance protection, including the following:

  • Do you know precisely when are you covered? Are you covered in all three phases of the job? Or, are some phases excluded from the policy’s coverage?
  • Does your coverage leave gaps (many people are forced to purchase traditional auto insurance and insurance from the rideshare company, only to discover that there are gaps in their coverage that are costly when accidents occur)?
  • Does driving for a rideshare company invalidate your existing policy? The bottom line is that not all private insurers are willing to extend coverage to rideshare drivers,  and you may not be covered at all if your insurance company discovers your rideshare activities.

Working with an independent insurance agency, like Insurance Center of North Jersey, means you can compare policies and coverage options from a number of insurance providers to find the one that offers the best combination of cost and coverage for your needs as a rideshare driver – no matter which ridesharing service you work for. We will help you get the right coverage you need so you can keep your rideshare business on the road, or get it back on the job quickly after accidents happen.

Contact us at 201-525-1100, and we will be glad to help you with any rideshare insurance needs.