Uber has become a popular way for people to earn extra cash. Some, in fact, make it a full-time job. One of the first questions that come up is whether or not an Uber driver (or any rideshare drivers working for a similar service) needs to buy rideshare insurance. The answer is a resounding yes in almost all cases!

Most drivers are under the assumption that they’re covered by either Uber or their own standard personal auto policy- neither of which is true in all cases. Uber will cover you in some instances. However, a personal auto policy without the proper rider, will not cover rideshare related accidents. It’s imperative to understand the limitations of each policy; your Uber policy, your personal policy, and your personal policy with the proper rider.

 

Understanding what is covered by Uber

 

It’s also important to differentiate the instances in which coverage is needed based on the activity the driver is engaged in. Let’s review the three activities that would merit coverage if an accident occurred and the breakdown of what Uber covers according to their website:

 

App on – Waiting for a ride request

 

Uber states that they’ll cover you for any liability to a third party while you are online with Uber, even if you don’t yet have a rider. What that means is that if you injure another person or cause damage to another vehicle other than your own, they’ll pay for the damage. Limits apply of course; total per accident coverage is $100,000, property damage is $25,000 per accident, and for injury, liability is $50,000 per person.

What this means to a rider is that if they’re injured, or their car suffers damage from a third party, the driver needs to file a claim against the other party’s insurance or their own auto policy. This is typically the most vulnerable time for drivers in terms of coverage, and when you definitely want to have that rideshare policy or rider to the policy.

 

App on – Driving to pick up a rider

 

Uber will cover you in this case with more generous coverage. They’ll cover the driver for damages caused to another party including pedestrian or property damage if the Uber driver is at fault. They’ll also cover hit and run if the party who caused the accident is unable to be located. Coverage, in this case, goes up to one million dollars for bodily injury.

In this case, there’s no need to make use of your personal policy since it’s all covered by Uber’s policy.

 

App on- Rider in the car

 

When a paying passenger is in the vehicle, Uber covers the rider with the same coverage as when they’re driving to pick up the passenger, and they also insure the rider. Here are the additional coverage details; one million for liability coverage to a third party includes the rider or another vehicle and its driver as well as property damage. Collision &  OTC (other-than-collision) coverage is also provided as long as your personal auto policy includes that coverage. While you’re not driving for Uber, this covers your automobile regardless of fault. Coverage is extended up to the current cash value of the car, and there’s a deductible of $1,000.

Passengers are also covered in case of accidents if another driver is at fault and has no insurance or is under-insured. Limits are up to one million dollars of total coverage for personal injury.

Now that you have perspective on what is covered by Uber, you need to know when you need insurance above and beyond what Uber offers and what a standard policy offers.

Most policies don’t automatically include rideshare insurance. However, the majority of the major carriers offer that rider. Some of them require that you purchase a commercial liability rider. Also, keep in mind that every state is different and that some states don’t offer rideshare policies/riders. In those states, Uber drivers have to purchase a full commercial insurance policy which can be costly.

To learn more about rideshare insurance or additional insurance options, contact our team at ProtectiveAgency.com or call (877) 739-9367. Our licensed insurance agents will be happy to answer any questions you have.