What type of insurance should I have as an Uber/Lyft Driver?
Ideally, to cover the gap in insurance coverage outlined above, you would want to get a commercial auto insurance policy. This type of insurance offers the most complete protection for you if you drive for a rideshare company. It effectively covers you during all stages of driving and is required if you drive for either Uber or Lyft within New York City.
However, not everyone can afford a commercial auto insurance policy outside of New York City and it may not make financial sense even if you can. This is particularly true if your income from rideshare driving is relatively small, such as if you only drive for the rideshare company on weekends, holidays, and/or for special events such as concerts and festivals.
A better option may be rideshare insurance, sometimes called “gap insurance coverage.” Rideshare insurance offers the best of both worlds. It is a blend of both personal and commercial auto insurance, offering more inclusive coverage than that offered by Uber or Lyft yet costing much less than commercial auto insurance. It extends your personal policy’s benefits to Phase 2 of driving for a rideshare company, giving you enhanced medical coverage, emergency roadside assistance and rental car reimbursement, should you already receive this coverage. Plus, if your insurance’s collision deductible is lower than the $2,500.00 offered by Uber and Lyft, with rideshare insurance you would only have to pay the lower amount after an accident during Phase 3 that damaged your car.
Rideshare insurance typically extends all the coverage of your personal insurance policy to your ridesharing activities in Phase 2. With the exception of liability coverage, this is also true during Phase 3 of rideshare driving. With rideshare insurance, if you have a claim, or a passenger is injured and files a claim against you, you would be able to communicate directly with your insurance company rather than through Uber or Lyft for your insurance needs.
While not offered everywhere and by every insurance company, rideshare insurance is becoming more popular due to customer demand. The key, as always, is to shop around to get the best rate. If your current insurer doesn’t offer rideshare insurance, be sure to speak to someone and ask them to make such policies available. Insurance companies do listen to their customers and hope to keep them as future customers.