Your Guide to Rideshare Insurance
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The proliferation of rideshare and delivery service drivers has drastically increased the need for a new kind of auto insurance policy. Rideshare insurance covers drivers when they’re signed into a rideshare app but not covered by the company’s insurance (more on that below). These drivers often work for Uber or Lyft or delivery apps like Instacart and Grubhub.
Most personal car insurance policies won’t cover accidents that occur while you’re signed in to a ridesharing app. And, if you don’t disclose to your insurance company that you’re driving for money, they may cancel your policy.
This creates a serious incentive to consider rideshare insurance, even if it’s not necessarily required.
You can add rideshare insurance to a current plan or choose to convert your existing plan into a rideshare plan, which would cover you for personal and rideshare driving (this may be referred to as a “hybrid” plan). Many insurance companies are now offering competitive rates as they’ve seen the demand for rideshare insurance skyrocket.
We’ve created a handy guide outlining the benefits of rideshare insurance, the differences between Uber, Lyft, and delivery app coverage, and a few of the best rates from top insurers. If you plan to work as a rideshare or delivery driver for the foreseeable future, it may be time to invest in comprehensive auto coverage. But, how much is rideshare insurance?
Breaking Down Uber and Lyft Rideshare Insurance
Uber and Lyft provide different coverage largely based on how far into your shift you are, known as periods or phases. It’s important to understand the different periods, because it may affect your liability and insurance coverage:
The periods can generally be broken down into these four distinct categories:[^1]
Period 0 – The app is off. Since you’re not operating as a rideshare driver, your personal auto insurance covers you.
Period 1 – Your app is on but you have yet to pick up any passengers. While waiting for a ride request, you are not covered by your personal auto insurance and your employer’s insurance policy (Lyft or Uber) only offers limited liability coverage. This means that if you’re in an accident, Uber and Lyft will only cover third party costs up to:
$50,000 per person for bodily injury
$100,000 per accident for bodily injury
$25,000 per accident for property damage
Period 2 – Once you’ve accepted a ride request and are headed to pick up your passenger, your full employer insurance kicks in. Uber[^2] and Lyft[^3] both carry the same coverage, except for the deductible:
Up to $1,000,000 third-party liability
Uninsured/underinsured motorist bodily injury depending on your state
Contingent comprehensive and collision up to the actual cash value of your car ($1,000 deductible for Uber, $2,500 for Lyft), which only applies if you have comprehensive and collision coverage with your personal auto insurance
Period 3 – If there are passengers in your car, you’re covered by your Uber or Lyft insurance with the same coverage as period 2.
While personal car insurance helps you while the app is off, and Uber or Lyft insurance coverage will help you while you’re en route to pick-ups or have passengers in the car, rideshare insurance essentially protects you during the vulnerable rideshare period 1.
Breaking Down Delivery App Driver Rideshare Insurance
If you’re a driver for one of the five most popular food delivery services—UberEats, Grubhub, DoorDash, Postmates, or Instacart—you’ll want to carefully read each company’s policy, as their coverage varies greatly.
Like with Uber and Lyft, there are distinct periods that determine what kind of coverage the drivers receive in the case of an accident. These include:
Period 0 – The app is off. You’re covered by your personal auto insurance.
Period 1 – The app is on and you’re waiting for a request. Your personal policy doesn't cover you. The five major food delivery apps will cover the following:
Grubhub, Instacart, & Postmates – No employer coverage, but requires you to have personal auto insurance to work as a delivery driver.
DoorDash – No employer coverage.
UberEats – Third party liability coverage only, which covers up to $50,000 bodily injury per person, $100,000 bodily injury per accident, and $25,000 property damage per accident.
Period 2 – You’ve accepted a request and are headed to pick up the order. The apps will cover the following:
Grubhub, Instacart, & DoorDash – No coverage
Postmates – Liability only, up to $1 million per incident
UberEats – Liability up to $1 million per incident plus contingent comprehensive and collision up to the value of your car (again, only if you have comprehensive and collision as part of your personal policy)
Period 3 – Your food or goods are in the car, en route to their final destination. The only food delivery app that changes at this point is DoorDash, which offers liability only, up to $1 million per incident—the rest remain the same as in period 2.
As we’ve detailed, the employer insurance coverage for Uber and Lyft is more extensive than for delivery app drivers. This is likely because of the increased risk with transporting other people, rather than just food, drinks, and assorted items.
In either scenario, investing in your own rideshare insurance is a good way to protect yourself for the entire duration of your shift, instead of constantly worrying about which period you’re in and the potential repercussions.
Top Rideshare Insurance Policies
Now that you understand the differences in your employer and personal coverage while you’re working as a rideshare driver, you’re better equipped to start shopping around for your own rideshare insurance.
Because transparency is paramount when dealing with insurance companies, you’ll want to first notify your personal auto insurance company that you drive for a rideshare company (meaning you’re using your car to make money).
You can then ask your current insurer if they offer rideshare insurance to help protect you during vulnerable driving periods.
*Note: Because rideshare insurance is not offered through every insurer or in every state, your insurer may bring up commercial auto policies instead. Drivers will commonly purchase commercial insurance policies when they’re using their car frequently for business purposes, like toting around goods or people. Commercial policies will typically cost more than personal policies.
While some states and insurers have yet to offer specific rideshare coverage, there are many options available from some of the leading car insurance companies. Read on to learn more about four of the most competitive rideshare insurance policies currently on the market.
Perhaps best known for their quirky ad campaigns, Geico is also one of the top rideshare insurance companies.
Geico’s policies typically cost more than other plans but are popular because they offer complete coverage whether you're working or not, have no mileage limits, and cover delivery drivers. In the case of an accident, you don’t need to worry about who to file a claim with—this Geico policy covers everything, and is available in 40 states.[^4]
Progessive’s rideshare policy is not as widely available as Geico’s, but is ideal for multi-platform drivers (for example, if you work for both Uber and UberEats).
Progessive’s plan has the benefit of total flexibility—the policy can be treated like an add-on to your existing personal policy or you can opt for a hybrid policy through Progressive that covers you personally and professionally. Progessive covers delivery and rideshare drivers fully during period 1, and covers the gap between personal and delivery coverage during other periods.[^5]
The greatest benefit for delivery drivers is that you can opt to customize your Progessive plan for on and off-season driving.
State Farm’s rideshare policy is available in most states and serves as a great add-on to your current personal policy.
While this policy can be pricier than some, it protects you during all rideshare periods and covers damages to your car, medical bills, emergency roadside assistance, and rental car reimbursement.[^6]
Rates vary, but expect State Farm rideshare coverage to cost about 15-20% of your current premium.
Allstate’s rideshare policies are available in nearly every state and boast low premiums.[^7]
This is a great coverage option for a Lyft driver because of their partnership with Allstate.[^8]
Allstate serves primarily as an add-on, working to protect you during period 1 when you’re waiting to accept a request. The cost of this policy is only about $15 to $20 a year, but keep in mind that this coverage is not as comprehensive as others.
Shop Car Insurance Rates Online
The popularity of rideshare and delivery apps has made driving for these companies a financially lucrative option. But before you hit the road, you’ll want to be sure that you have the best coverage possible to protect you, potential passengers, and other drivers.
Rideshare insurance is a relatively new coverage option that protects you while you’re working, where your employer insurance and personal insurance fall short.
Just how much is rideshare insurance? Companies like Geico, Progressive, State Farm, and Allstate offer competitive rates, but they vary based on your personal driving record, current vehicle, and other factors. Securing cheap rideshare insurance will depend partly on you.
But it helps if you know where to find the best cheaper insurance options.
If you’re in the market for a new policy, be sure to head to Online Auto Insurance to compare rates from top insurers and get a fast and free quote.
KM Kwartler Manus LLC. What Are The Three Rideshare Periods?\ https://www.kminjurylawyers.com/firm-news/blog/2019/march/what-are-the-three-rideshare-periods-/
Uber. Auto insurance to help protect you.\ https://www.uber.com/us/en/drive/insurance/
Lyft. All things insurance, all in one place.\ https://www.lyft.com/driver/insurance
Geico. Rideshare Insurance. \ https://www.geico.com/rideshare-insurance/
Progressive. Rideshare Insurance. \ https://www.progressive.com/auto/insurance-coverages/rideshare/
StateFarm. Do You Need Rideshare Insurance? https://www.statefarm.com/insurance/auto/coverage-options/rideshare-insurance
Allstate. What Does Rideshare Insurance Cover? \ https://www.allstate.com/tr/car-insurance/ride-sharing-insurance.aspx
Allstate. Allstate and Lyft Partner to Protect Drivers in Eight States.\ https://www.allstatenewsroom.com/news/allstate-and-lyft-partner-to-protect-drivers-in-eight-states/
[^1]: KM Kwartler Manus LLC. What Are The Three Rideshare Periods? https://www.kminjurylawyers.com/firm-news/blog/2019/march/what-are-the-three-rideshare-periods-/
[^2]: Uber. Auto insurance to help protect you. https://www.uber.com/us/en/drive/insurance/
[^3]: Lyft. All things insurance, all in one place. \ https://www.lyft.com/driver/insurance
[^4]: Geico. Rideshare Insurance. \ https://www.geico.com/rideshare-insurance/
[^5]: Progressive. Rideshare Insurance. \ https://www.progressive.com/auto/insurance-coverages/rideshare/
[^6]: StateFarm. Do You Need Rideshare Insurance? https://www.statefarm.com/insurance/auto/coverage-options/rideshare-insurance
[^7]: Allstate. What Does Rideshare Insurance Cover?\ https://www.allstate.com/tr/car-insurance/ride-sharing-insurance.aspx
[^8]: Allstate. Allstate and Lyft Partner to Protect Drivers in Eight States. https://www.allstatenewsroom.com/news/allstate-and-lyft-partner-to-protect-drivers-in-eight-states/