Driving for Uber? Here’s What You Need to Know About Insurance

Rideshare companies like Lyft and Uber give people the freedom to work on their own schedule and earn some extra cash. But are there risks? What exactly is covered by Lyft and Uber insurance policies? If you’re considering driving for Uber or Lyft, here’s what you need to know.

Do Uber and Lyft provide insurance?

The insurance provided by Lyft and Uber may cover you in a variety of instances. Once you’ve accepted a client and begin driving to the destination, Lyft and Uber both provide $1 million in third-party liability coverage for damage to a third party such as property, another driver, or a pedestrian in the case of an accident where you are at fault. Both companies specify this as primary coverage, and both recommend contacting them in case of an accident. Lyft additionally recommends having personal coverage to provide as proof of insurance at the scene of an accident.

Do Lyft/Uber insurance policies cover my car?

It depends. Once you accept a ride request and begin driving to pick-up your passenger, both companies cover your car in the event of a comprehensive claim or collision up until you drop your passenger off at his/her destination. However, the same coverage does not apply if you have the app open but have not accepted a client.  In this case, Uber’s third-party liability coverage only provides up to $100,000 in total liability per accident. That $100,000 is further restricted to $50,000 in injury liability per person and $25,000 in property damage liability.

Doesn’t my personal insurance cover me if I’m a driver?

In most cases, no. This is why there are personal car insurance policies and commercial vehicle insurance policies. Insurance companies curate car insurance rates on a variety of factors, with one of the most important being how often you drive. If you drive all over town for hours a day as a job, you are at a higher risk for an accident than if you commute on a specific road for thirty minutes every day. Insurance companies view personal and commercial policies in a very different light and each covers different situations.

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If an accident occurs, couldn’t I just turn off the app and file a personal claim with my insurance?

No, this would be an example of insurance fraud. Committing insurance fraud comes with a variety legal risks, and you will bear the financial burden when your claim gets denied – in addition to the financial burden that comes with the legal risks. During the investigation of a claim, companies can access timestamped logs of your active periods within the app, which company you are with, and where you drove during specific time periods.

Do I need a commercial policy?

If you decide to drive full-time, your insurance company may require you to get commercial vehicle coverage. Each instance is unique, and every company is different, so it’s important to discuss this with a professional to ensure that you get the best coverage and rates.

If you’re interested in learning more about car insurance in general or in relation to rideshare companies, contact McInturff, Milligan & Brooks via the form below or at (423) 639-5171 for a customized quote that fits your needs.

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