Does My Car Insurance Cover Me if I Drive for Uber or Lyft?
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One of the biggest developments in the automotive world has been the technological advancements in driver services. Gone are the days of hailing a taxi in the street; now, with your smart phone, and only a minute or two of wait time, you can be picked up by an Uber or a Lyft driver, and whisked off in a clean and comfortable car, to the destination of your choice, usually for a fair bit less money than a cab would have cost.
However, the excitement of modern rideshare services isn’t reserved for riders; it’s also good for drivers. Uber and Lyft have provided both part and full-time job opportunities for people all over the country, whether they need supplemental income, a filler while they’re between jobs, or constant work.
Of course, driving for a rideshare service changes your profile as a driver, and that matters a lot when it comes to auto insurance. Car insurance coverage changes depending on what you’re doing with your car, so it’s important to know how you’re covered as a rideshare driver.
Does my insurance policy cover me if I sign up to be a rideshare driver?
The short answer is no, but it’s not quite that simple. Your insurance company can most likely cover you if you decide to work for Uber or Lyft, but your current insurance package likely does not.
Assuming you have not been driving for monetary purposes previously, you likely have a personal insurance package. Driving for Uber or Lyft counts as a profession (even if you do it part-time), so you’ll need an insurance package that covers it.
As Uber and Lyft have become popular, so too has rideshare insurance. Many insurance companies offer rideshare insurance, which keeps your car insured despite the fact that you use it for professional purposes.
Rideshare insurance is usually only a small bit more costly than standard insurance, but there is a catch: it’s only allowed in certain states (AL, AZ, CA, CO, GA, IA, IL, IN, KS, KY, MA, MD, ND, NE, NV, OH, OK, OR, TN, TX, WA, and WY) and not all insurance companies cater to all those states. To find out if your insurance company and your state offer rideshare insurance, give your provider a call.
If rideshare insurance is not available to you, you’ll have to buy commercial automotive insurance to fully cover you while driving.
Do Uber and Lyft offer insurance packages?
When you drive for Uber and Lyft, your car is automatically covered to a certain extent. Both companies offer $1 million liability coverage packages, but the caveat is that this only covers you while you are on your way to pick up a passenger, or transporting a passenger.
If you are in your car, logged in to the app, but not currently on a job or en route to one, the coverage is very slim. And it goes without saying, Uber and Lyft’s insurance does not cover you at all if you are not logged into the app, ready to take on rides, so you can’t simply dump your insurance plan and rely on your ridesharing company.
So how should you get rideshare car insurance?
The key with insurance plans is always finding what best fits your needs and fills in the gaps, and that’s doubly true if you work for Lyft or Uber. Because these companies offer such little coverage when you’re on the job, but not currently accepting a ride (which can be a lot of time, especially for new drivers), you should definitely upgrade your insurance plan to include ridesharing or commercial use. Even if you don’t, it’s imperative that you alert your insurance company about your ridesharing; if you don’t disclose this information, your insurance can be voided.
Getting proper insurance while driving for Uber or Lyft doesn’t need to be a hassle. Look at your current plan, and the plans available to you from your provider (and feel free to contact them). Find one that covers you for all situations, and you’ll be good to go. Maintaining your car insurance is critical, but it’s also important to make sure that you get the best available rates for your situation.