Driving for Uber or Lyft? You May Not Be Properly Insured

Published in Clifton Park Neighbors Magazine – Summer, 2021

By Don Ferlazzo, Agent/Agency Owner

With bars, restaurants, entertainment venues and travel opening-up in our area, we are sure to see an uptick in the number of Uber and Lyft drivers on the roads. If you’re one of them, you are insured by Uber and Lyft’s respective commercial insurance policies in some instances, but you can also face risky coverage gaps, increased costs and unexpected consequences when using your personal vehicles for ridesharing.

As a driver, the commercial policies for Uber and Lyft cover your liability and your vehicle whenever you have accepted an assignment to pick up a rider, and they also cover injuries to your passengers once they are in the car. However, there’s a certain period of time when you’re awaiting your next assignment during which Uber and Lyft’s commercial policies do not provide coverage and if your personal auto insurance doesn’t allow you to drive for rideshare companies you would be on the hook for damage you cause and people you hurt.

There’s also the risk of having to pay more than usual to get your own car fixed if it’s damaged while you’re driving for a rideshare company. You may be used to having a $500 deductible (or lower) on your personal auto policy, but when you’re driving for Uber or Lyft the deductibles under their commercial policies can be as high as $2,500 per occurrence, meaning you will have to pay that much more to get your car fixed if it’s damaged on the job.

But perhaps most overlooked (or ignored) by rideshare drivers is that you may face serious consequences if you drive for Uber or Lyft without the knowledge and permission of your personal auto insurance carrier. The truth is, most insurance companies do not allow you to drive for a rideshare company, and if they find out you are doing it they may cancel your insurance at the end of your term, deny a claim or both.

Luckily, there is a way to solve these issues for rideshare drivers – with a “Ride for Hire” endorsement. When our clients select this optional coverage, it fills the coverage gap while you are awaiting a rider assignment, lowers your deductibles to match those selected on your personal auto policy, and it gives you permission to drive for Uber or Lyft knowing you won’t get cancelled or have a claim denied because of it. This coverage is also extremely affordable, usually adding about $20/car to your 6-month Allstate premium.

If you are driving for Uber or Lyft and would like the extra protection and peace of mind a “Ride for Hire” endorsement provides, just give us a call at 518-978-4044 or click the button below to request a free, no-obligation quote.