Uber / Lyft Insurance

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What You Need to Know About Rideshare Insurance

So… you want to be a rideshare driver! You signed up to drive for Uber, Lyft or another rideshare service, and you want to get on the road as soon as possible. In the excitement and the rush getting started, it’s very easy to overlook one very important factor… rideshare insurance.

You might be asking, “don’t rideshare companies like Uber and Lyft provide commercial insurance to drivers?”  The short answer is YES, they do.  However, there are some large holes or gaps in coverage, which can put rideshare drivers into a high risk of damage, money, and liability if not properly handled.

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Basic Elements of Rideshare Insurance

It’s important to know there are:

• Coverage Periods
• The “Coverage Gap”
• Coverage Types

Before we dive into how drivers are at risk with the standard insurance provided, we need to define a few time frames, or “Periods” that are used to determine the coverage that applies to an accident. These periods are broken up into three distinct categories and apply to the various activities drivers perform.

  • Period 1: Driver is logged into the app but waiting for a request. (“driver mode”)
  • Period 2: Driver has a request and is en route to pick up a passenger.
  • Period 3: Passenger is in the car and is en route to the desired destination.

While coverage technically applies to almost every one of these periods, the coverage provided between Periods 1 & 2 leave room for holes or gaps, and is significantly lower than during Periods 2 & 3. 

In addition, some companies will even cover the difference in the physical damage deductible on the driver’s personal policy and the deductible on the TNC policy in those two periods.

Types of Rideshare Insurance Policies

What type of rideshare insurance do drivers need to be protected? Insurance companies today are adapting to the growing transportation industry, and offer a few different types of rideshare insurance policies. They cover a wide spectrum, but the two most common types are Gap Coverage and Full Coverage.

Gap Coverage Policies
Drivers that understand the insurance gap may opt for a Gap Coverage rideshare insurance policy. This type of policy is fairly basic, but focuses on reducing the liability between Period 1 and Period 2, narrowing the coverage gap. Gap Insurance offers excess coverage that expands what drivers receive from an Uber or Lyft policy in Period 1.  Policies like these are can be more affordable and are available nationwide.

Full Coverage Policies
The other popular rideshare insurance policy type is a Full Coverage policy. This type of policy is most like a commercial insurance policy and covers a wide range of coverage options. These include basic coverage, along with excess coverage for the areas above outlined during Periods 2 and 3.

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To Conclude

There’s a lot to learn about rideshare insurance, but the most important thing is to have a rideshare insurance policy before you get on the road. It’s also important to know the following:

  • It’s important to understand the differences between your personal insurance policy and a TNC-provided policy.
  • Often times there is a coverage gap between your personal policy and your TNC policy, so consider getting an additional policy.
  • Depending on where you drive, rideshare insurance may not be available.

In addition, your personal insurance company may not offer this type of insurance, so be sure to address these issues right away and verify you’re covered.


Have Questions? Talk to a UA Rep About:

  • Deductible Costs on Your Uber / Lyft Provided Insurance.
  • The Cost of Rideshare Insurance.
  • Comprehensive and Collision Coverage.
  • Nearly All of Your Auto Insurance Needs.

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