The Insurance You Need to Succeed As an Uber Driver
Your regular car insurance doesn’t cover you when working as an Uber driver, which is why drivers require additional coverage: an add-on rideshare policy to their auto policy.
Being involved in an accident is one thing, but being unable to return to your shift can be devastating. That is why it is essential to document everything.
Liability Coverage
According to the Business Reviews guide to taxi insurance, uber drivers may need to purchase a rideshare endorsement on their personal auto policy in order to cover liability while working for Uber, though their own policy must pay out first (referred to as primary coverage in insurance terms). By adding this policy feature they could enjoy protections such as third-party bodily injury/property damage liability as well as uninsured/underinsured motorist bodily injury coverage.
Insurance providers such as Allstate, Farmers, State Farm and USAA all offer rideshare options at as little as $6 additional monthly premium for existing policies. In addition to providing coverage while working for Uber, this endorsement can also fill liability gaps when not actively connected to Uber’s app.
On-demand delivery drivers like Grubhub, Instacart and Uber Eats drivers can benefit from adding rideshare insurance policies as an add-on to their personal car policy. These hybrid policies – commonly referred to as rideshare insurance policies – cover them both when not connected with any apps as well as when out picking up passengers or delivering orders.
Uber drivers must maintain a minimum level of personal auto insurance. When the Uber app is active and waiting for requests, liability coverage of up to $50,000 per person and $100,000 total can be provided through Uber’s liability protections; while transporting passengers, coverage extends up to $25,000 for property damage and $1 Million for bodily injuries caused by their ride.
After each trip is complete and the Uber app has been closed, drivers relying on personal auto insurance until relogging into it and accepting requests – at which point Uber’s coverage will return for another journey.
If you’re interested in driving for Uber or another on-demand delivery service, we recommend consulting an independent agent who can evaluate your personal car policy to see whether an endorsement or separate Uber policy might be more suitable. An agent can then compare rates from various insurers until finding what best meets your unique situation and budget; plus they’ll help determine how much liability coverage is necessary for success.
Medical Payments
Many drivers sign up with Uber and other rideshare services in hopes of earning extra income, but may underestimate what type of insurance coverage is necessary for driving for them. Uber operates under special regulations which necessitate special coverage not typically found within an individual auto policy – however there are additional options available to cover any gaps and protect Uber drivers from underinsuring themselves.
USAA provides rideshare gap coverage that covers an Uber driver when they sign into the app but have yet to accept ride requests, for as little as $6 extra monthly on vehicle insurance premiums. Mercury also has policies available that provide comprehensive and collision coverage when an Uber driver is online between rides; additionally it covers actual cash value coverage after collision – an added advantage compared to most personal policies which only provide up to a set threshold limit of coverage for this type of incident.
Uber driver car insurance should include personal injury protection (PIP). PIP provides up to $10,000 in medical bills and 60% of lost wages should an injury arise while working for Uber, in addition to covering towing and rental car expenses as necessary – without needing a claim form or proof of insurance being submitted in order to collect benefits.
If you are involved in an Uber car accident, always send them a written request to preserve their event data recorder (EDR). EDRs help to establish fault in an incident by recording speed prior to impact.
Although many riders don’t think about it when using an Uber service, it is wise to inspect their vehicle for damage prior to allowing the driver to use it. Furthermore, passengers should insist on wearing seat belts during each journey in an Uber vehicle and should insist upon being secured within it at all times. In case of an Uber-related accident that leaves them injured or disabled, contact an attorney familiar with these specific types of crashes immediately.
Uninsured/Underinsured Motorist Coverage
Uber drivers must meet certain insurance requirements to operate legally, including having adequate protections in place against personal injuries and vehicle damages as outlined by state laws. Personal auto policies often do not cover rideshare services; you need a rideshare endorsement on your policy to meet this need.
Uber provides additional protection during certain stages of your trip and supplements your own insurance when not on the app. Period 1 occurs when an order for service is submitted but not accepted – during this phase, Uber provides liability coverage of up to $50k per person injured, $100k total bodily injuries caused in an accident, and $25,000 property damages caused by your car to other people.
Period 2 begins when you set out on your journey to pick up passengers. Uber provides additional bodily injury and property damage liability coverage of up to $1 million as well as collision/comprehensive coverage if your car is damaged by an uninsured or underinsured motorist.
Once your passenger is inside your vehicle, Period 3 begins. At this point, Uber provides $1,000,000 of property damage coverage along with your own coverage up to the same limits; additionally, up to $1 Million in medical payments coverage for passengers and other people travelling within your car is insured against.
Once your ride is completed, Period 4 begins. In this stage, when driving your own car and not using Uber’s app to track you, your Uber driver’s insurance covers up to $1,000,000 of bodily injury and property damage coverage as well as uninsured/underinsured motorist protection of up to $100,000 should any accidents happen during this phase.
Some personal auto policies offer rideshare endorsements, though these often provide fixed coverage that’s insufficient for most drivers. There are separate rideshare policies available which provide more comprehensive protection with flexible limits and deductible options, among other benefits. An independent insurance agent who specializes in Uber coverage can assist drivers in understanding Uber policies as well as any available options.
Comprehensive Coverage
As an independent contractor, it is your responsibility to track your expenses for tax time. Rideshare-specific auto insurance provides some great deductions when operating your vehicle for ridesharing; additionally it covers you when waiting on Uber requests without customers yet or when using the Uber app but without customer. Comprehensive coverage usually costs more than collision coverage but could save money in the long run should anything happen to damage or stealthy your car.
Remind passengers to say hello and goodbye when they enter, and ensure your car is clean inside and out. Don’t smoke inside, and keep air fresheners available so odors won’t linger. Additionally, offer passengers the ability to customize climate settings, access audio jacks and phone chargers, as well as help themselves to drinks if needed.
American Family Insurance can help you become an Uber or Lyft driver partner and experience all the freedom and flexibility of driving for Uber or Lyft. We will make sure that you have adequate protection from lawsuits or bankruptcy should anything arise while on the road.
