Auto Insurance And Uber: What's The Coverage When You Ride?

If you're a driver for a Transportation Network Company (TNC) like Uber, you must have auto insurance at all times while your rideshare app is on. Uber provides its own insurance coverage for drivers, but it is limited and only covers drivers when the app is running and they are working. This means that, as a driver, you will need to purchase a separate rideshare endorsement from an insurance company to ensure you have adequate coverage. Uber's insurance coverage varies depending on whether you are waiting for a ride request, en route to pick up a passenger, or transporting a passenger. It is important to understand the different periods of coverage to ensure you are protected in the event of an accident.

Uber's insurance policy

Period 1: The app is on, but the driver is waiting for a ride request. During this period, Uber offers third-party liability coverage of $50,000 in bodily injury per person, up to $100,000 in bodily injury per accident, and $25,000 in property damage per accident. However, the company does not offer comprehensive and collision coverage during this phase.

Periods 2 and 3: The driver has accepted a ride request and is on their way to pick up a passenger (Period 2), or the passenger is already in the car (Period 3). Uber offers higher liability coverage during these periods, providing $1 million in third-party liability coverage. The company also provides uninsured/underinsured motorist coverage and comprehensive and collision insurance with a deductible.

It is important to note that Uber's insurance policy has several coverage gaps, and drivers are advised to have their own personal car insurance policy and add a rideshare endorsement to ensure full protection. Personal insurance policies do not typically cover commercial activities like ridesharing, and insurers may deny claims or cancel policies if they discover a driver is using their vehicle for ridesharing without the appropriate coverage.

Additionally, Uber's coverage levels, especially for liability, may not meet the recommended thresholds, leaving drivers with potential out-of-pocket costs in the event of an accident. Therefore, it is crucial for Uber drivers to carefully review their insurance options and consider purchasing additional coverage to ensure they are adequately protected.

Personal insurance policies

Personal auto policies cover vehicles used for personal purposes, such as commuting to and from work, or driving children to school. They are not intended for business or commercial use, and insurance companies consider driving for Uber or similar companies to be business use.

If you are a rideshare driver, you need to have a commercial or business auto policy, or a personal auto policy that offers rideshare coverage as an endorsement. This is because personal insurance policies contain a clause that explicitly excludes commercial activities like ridesharing. If you are in an accident while driving for a rideshare company, your insurer can deny any claim and cancel your policy.

Uber does offer its own insurance coverage for drivers, but it is limited and only covers you when the app is running and you are working. It is therefore recommended that drivers have their own personal insurance policy as well, to ensure they are fully protected.

Rideshare insurance is a type of insurance that covers drivers during the period when the app is on but they are waiting for a ride request. This type of insurance can be added as an endorsement to a personal auto policy, or purchased as a separate commercial policy.

Insurance endorsements

Understanding Insurance Endorsements

An insurance endorsement, also known as a rider or policy amendment, is an addition to an existing insurance policy that modifies or adds to its terms and conditions. In the context of ridesharing, an endorsement is necessary to extend the coverage provided by a personal auto insurance policy to include ridesharing activities. This is important because standard personal auto insurance policies typically exclude coverage for commercial or business use, which includes driving for ridesharing services.

The Need for Insurance Endorsements in Ridesharing

When you drive for a ridesharing company like Uber, your personal auto insurance policy does not provide coverage. This is because driving for a ridesharing service is considered a business or commercial activity, which falls outside the scope of a personal auto policy. As a result, you need to purchase a separate endorsement or add it to your existing policy to ensure you have the necessary coverage while driving for Uber.

Benefits of Insurance Endorsements for Rideshare Drivers

• Extended Coverage: An endorsement extends your personal auto insurance policy to cover ridesharing activities, filling the gaps in coverage provided by the ridesharing company's insurance.
• Protection from Financial Risk: Without an endorsement, you may be held financially responsible for damages or injuries resulting from an accident while driving for Uber. An endorsement ensures you have adequate coverage to protect yourself and your passengers.
• Compliance with Legal Requirements: Depending on your location, you may be required by law to have a specific type of insurance when driving for a ridesharing company. An endorsement helps ensure you comply with these regulations.
• Seamless Claims Process: With an endorsement, you won't have to worry about your personal insurance company denying your claim due to business use. This simplifies the claims process and provides peace of mind.

Obtaining an Insurance Endorsement

To obtain an insurance endorsement for ridesharing, contact your insurance provider and inform them that you drive for a ridesharing company. They will guide you through the process of adding the endorsement to your existing policy or help you purchase a separate endorsement if needed. It's important to shop around and compare rates and coverage options from different insurance providers to find the best fit for your needs.

In summary, insurance endorsements are a vital component of ensuring adequate coverage for rideshare drivers. By extending your personal auto insurance policy to include ridesharing activities, you protect yourself, your passengers, and your finances in the event of an accident.

Insurance claims

If you are involved in a crash while driving with Uber, you can report it to Uber first. Uber's claims support team will guide you through the claims process.

Uber offers its own rideshare insurance coverage, but drivers should still have their own personal car insurance policy to make sure they are fully protected. This is because Uber's insurance policy has several coverage gaps. For example, Uber's insurance policy only covers you when the app is running and you are working for Uber. When the app is closed, your personal auto policy provides coverage.

Uber's insurance policy also has a high deductible, which means you'll have to pay a lot out-of-pocket before Uber's coverage kicks in to cover your claim.

Additionally, Uber's coverage levels, especially for liability, are below the recommended thresholds. For example, most insurance experts recommend $100,000 of bodily injury coverage per person, but Uber's policy only provides $50,000.

Therefore, it is important to have a rideshare endorsement added to your personal auto policy to fill in any coverage gaps and provide additional protection. This type of insurance can help cover liability, collision, and comprehensive claims that may arise during an accident while driving for Uber.

In summary, while Uber does offer insurance coverage for its drivers, it is important to have your own personal insurance policy and a rideshare endorsement to ensure you are fully protected in the event of an accident.

Insurance requirements

If you are a rideshare driver, it is important to have the right insurance coverage. Here are the key things to know about insurance requirements for ridesharing services like Uber:

Personal Auto Insurance

Your personal auto insurance policy typically does not cover ridesharing activities. Personal auto policies are intended for personal use, such as commuting to work or running errands, and do not include commercial or business use. Therefore, if you are driving for Uber, your personal auto insurance will not provide coverage, and your insurer may even cancel or refuse to renew your policy if they find out about your ridesharing activities.

Rideshare Insurance

Rideshare insurance is specifically designed for drivers who work for companies like Uber. This type of insurance fills the gaps in coverage that exist when you are driving for a ridesharing service. It is important to note that rideshare insurance is not a replacement for your personal auto insurance but rather an additional layer of protection.

Uber's Insurance Coverage

Uber provides insurance coverage for its drivers, but it is limited and may not be sufficient on its own. Uber's insurance only applies when the app is running and you are working for Uber. It includes liability coverage, uninsured/underinsured motorist coverage, and comprehensive and collision coverage with certain deductibles and limitations. However, it is important to understand that Uber's insurance is contingent, meaning you must first submit a claim to your personal auto insurance before Uber's coverage kicks in.

Adding a Rideshare Endorsement

To ensure adequate coverage, it is highly recommended to add a rideshare endorsement to your personal auto policy. This endorsement will provide additional protection during the periods when you are waiting for a ride request, on your way to pick up a passenger, or transporting a passenger. The rideshare endorsement fills in the gaps in Uber's insurance coverage and helps protect you from financial risk in the event of an accident.

State and Local Requirements

Frequently asked questions