Rideshare Insurance For Drivers

Rideshare Insurance For Drivers: The Essentials

Ride-sharing services like Uber and Lyft employ over three million drivers as independent contractors. However, these ride-hailing apps have increased traffic deaths by 2-3% since 2011 (1,000 extra deaths annually), a study by the University of Chicago and Rice University reveals. Uber and Lyft do provide drivers with liability coverage, but this is dependent on the app’s status and the presence of passengers.

Rideshare Insurance For Drivers: The Essentials

Insurance coverage

Insurance coverage

Most Uber and Lyft drivers have only personal — not commercial — insurance policies. Since the premiums for commercial policies are fairly high, not many drivers purchase this coverage. Personal policies, however, don’t cover accidents that occur while the vehicle is used for commercial reasons. So if an Uber driver causes an accident that injures their passenger or another third party, any claims to the driver’s insurance company will be denied. Additionally, the driver’s policy will likely be canceled, as they’d be violating its terms (the vehicle must only be used for personal reasons, and not commercial ones).

Ridesharing endorsements

Ridesharing endorsements

For drivers, understanding liability and filing a correct claim after an accident is often complicated, but specialized Uber accident lawyers can work with drivers to help prove liability and up the odds of winning a fair settlement. In some states, insurance companies now offer Uber and Lyft drivers additional coverage. Ridesharing endorsements are cheaper than commercial coverage and cover liability and property damage to the driver’s vehicle. However, they’re not applicable during all periods of work: period 0 (the app is off); period 1 (the app is on, but the driver hasn’t accepted a ride); period 2 (a driver has accepted a ride and is going to pick up a passenger); period 3 (passengers are in the vehicle).

Rideshare Insurance For Drivers

During period 0, drivers are only covered by their personal insurance policies. During period 1, drivers have limited liability coverage from the app, which pays $50,000 per injured person for up to two people, and $25,000 property damage. However, this coverage only applies if the driver’s personal insurance doesn’t cover all damages. For periods 2 and 3, drivers are covered by the app’s $1,000,000 liability coverage. Comprehensive and collision coverage is also provided for drivers with these policies already on their personal policy.

Navigating the aftermath of an Uber accident certainly isn’t easy. As a rideshare driver, it’s important to understand your insurance policies, the coverage they provide, and their legal implications.

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