Texas Rideshare Insurance
The gig economy continues to explode across the United States and leading this intriguing change in the way we work is ridesharing. Companies such as Uber and Lyft are popular examples of ridesharing which provides a mode of transportation for riders in need of a ride for errands, a night out, to the airport, and anywhere else. Drivers looking to turn their cars into a revenue stream can hustle their way through the streets collecting passengers and tips along the way, but how does ridesharing affect your auto insurance policy?
Whether you are working full time or just looking for a side hustle, ridesharing can be a great option to earn an income, but it can also affect your insurance policy coverage and premium. Companies such as Uber and Lyft will both offer limited protections to drivers, but there are many lapses in coverage that may occur. Usually, your coverage from whichever company you are driving for is only good once you accept a passenger and are en route to pick up your passenger or to their destination, and don’t be fooled! Even if you aren’t transporting human passengers, but are instead working for a delivery service such as DoorDash, Grubhub, Postmates, or Uber Eats, you’ll also need additional coverage or lapses in your protection may occur. Learn more about staying protected with the right Texas rideshare insurance policy for your automobile at all times while working in the rideshare industry.
What is Rideshare Insurance?
Rideshare insurance is offered by a variety of top-rated insurance carriers to help protect drivers while working their ridesharing shifts. If you are in your automobile with your app on and waiting for a passenger and an incident was to occur, you would not be covered. Your company-issued protection only kicks in once you are en route and your personal auto policy may not cover the damages because you were driving commercially at the time and not for personal use. It is also important to realize that even with your employer-issued coverage, you may only have a limited amount of coverage such as liability. To avoid a lapse in coverage, some endorsements can be added to your auto insurance policy to keep you protected. This includes both a personal auto policy endorsement or a commercial auto insurance policy.
By adding a personal auto policy endorsement to your standard auto insurance policy, you can gain the protection you need in a customized manner for your ridesharing endeavors. This endorsement will vary by the insurance carrier, but you can add it to your auto policy to prevent gaps in coverage such as an accident that occurs while you are waiting for a passenger or if you are driving home with your app on. A commercial for-hire livery to replace your personal auto insurance policy is another option for drivers as they qualify for the coverage because they use their vehicles for creating an income. Your commercial for-hire livery covers both the personal and commercial use of your vehicle.
What Does Rideshare Insurance Cover?
Rideshare insurance covers you for accidents that can occur while you are working for a ridesharing app but are not covered by their protection at the time. As repair costs and medical costs rise, it is important to remember that a lapse in your coverage can reach thousands upon thousands of dollars in an instant. Depending on your personal auto insurance coverage alone, even when offered some protection by your employer, can leave you paying for repairs and medical bills on your own. For drivers participating in ridesharing, the choice is clear, car insurance for rideshare drivers is an affordable, responsible way to protect yourself while working your hustle.
How to Get Rideshare Insurance
You can purchase rideshare insurance through any single insurance carrier or through an agency. Many insurance carriers offer rideshare insurance but with so many brands available, it can be difficult to know that you are getting the best price for your coverage. At TGS Insurance, we comparison shop through more than 35 top-rated insurance carriers to find the best coverage for your needs at the lowest price on the market. Contact our agents today and find the right rideshare insurance for your coverage needs today.
Rideshare Insurance FAQs
Adding ridesharing insurance protection can increase your monthly premium, but most companies make this coverage very affordable. Policy increases ranging from $2 to $25 a month are reasonable averages drivers can expect to pay and will depend on a variety of factors including your credit score, driving history, traffic violations, and other factors. Speak with your insurance agent to learn more about your insurance carrier’s rates for ridesharing insurance.
You may get away without telling your insurance company that you are ridesharing, however, if you fail to notify your insurer and are in an accident while working, your insurance company can deny your claim and not pay out anything at all. The result? Leaving you to pay for the damages in the aftermath and exposed to liability you normally would be protected from. It is always encouraged to notify your auto insurance provider if you are participating in ridesharing before it is too late.
If you don’t want to experience a potential lapse in coverage, car insurance for rideshare drivers working for Uber is imperative. There are four rideshare periods (phases) to consider while driving for Uber:
Period 0- You are not using your app during this period and are covered by your personal auto insurance policy.
Period 1- In this period, your app is on and you are awaiting a passenger. During Period 1, your personal auto policy does not provide coverage and you are dependent upon Uber’s liability coverage only.
Period 2- During this period, drivers have accepted a request for pick up and are on their way to pick up their passengers. You now gain uninsured/underinsured and comprehensive and collision coverages on top of your liability coverage as offered through Uber.
Period 3- The final period is when a driver’s car is occupied by their passengers. During Period 3, you will receive the same coverages as you do in Period 2.
Uber’s deductible is $1,000. Actual coverages may vary from state to state.
Lyft drivers looking to avoid a lapse in coverage will need to purchase additional rideshare insurance protection while driving for the rideshare platform. Similarly to Uber, there are four rideshare periods (phases) to take into consideration when driving for Lyft:
Period 0- Drivers are not using the app and are covered by a personal auto insurance policy.
Period 1- In Period 1, the Lyft app is on and you are awaiting your passenger. Your personal auto policy will no longer provide coverage and you are dependent upon Lyft’s coverage which is liability coverage only.
Period 2- Drivers that have accepted a request to pick up a passenger and are on their way enter Period 2. Here, you will gain uninsured/underinsured and comprehensive and collision coverages along with your liability coverage that is provided by Lyft.
Period 3- The last period is Period 3. This period is when your car is occupied by your passengers; you will receive the same coverages as you do in Period 2.
Lyft’s deductible is $2,500. Actual coverages may vary from state to state.
When driving for Uber Eats, drivers will find themselves in periods similar to ridesharing with passengers. This means that you will need rideshare insurance coverage when working these gigs if you want to avoid potential lapses of coverage in some areas. These four periods (phases) include:
Period 0- Drivers are covered by their personal auto insurance policy because the app is off.
Period 1- In Period 1, drivers are awaiting a delivery and personal policies without additional rideshare insurance coverage will no longer apply. Drivers for Uber Eats will receive liability coverage only from the company’s coverage during this time.
Period 2- Once you are on your way to pick up food for your customer, liability coverage continues and you will now have comprehensive and collision added by Uber Eats’ coverage.
Period 3- The final period is when you are back in your car with the products that are to be delivered. You will receive the same coverages as you would in Period 2 from Uber Eats.
There is a $1,000 deductible for comprehensive and collision claims. Actual coverages may vary from state to state.
Driving for DoorDash can be a great way to earn extra income, but can expose you throughout multiple periods or phases to a range of liability without the right car insurance for rideshare drivers. These four periods (phases) include:
Period 0- Your DoorDash app is off and you are covered by your personal auto insurance policy.
Period 1- Here, drivers are waiting for a delivery to be requested. Personal auto policies that lack rideshare insurance coverage will not protect you anymore. DoorDash does not offer coverage to its drivers during Period 1.
Period 2- Drivers are picking up their client’s food during this phase and are not covered by a personal auto policy without rideshare insurance coverage nor DoorDash as the company does not offer protection during this period to its drivers.
Period 3- The last period occurs once a driver has secured their client’s food and is on the way to complete the delivery. Liability coverage is offered by DoorDash but comprehensive and collision coverages are not.
Actual coverages may vary from state to state.