In today’s world, it is easier than ever to become a solopreneur. In your spare time, you could easily sign up to be a driver, and earn extra income on a part-time or full-time basis. However, most are confused about how this affects their Auto Insurance. Below, I will address several factors that can affect UBER and LYFT drivers.
Will my personal Auto Insurance provide coverage?
It depends, every carrier has a different stance on this subject. Typically, most carriers will exclude coverage during the following “3” events. 1. “Vehicle owner has mobile app “on” but match with a rider has not been made.” 2. “A match with a rider has been made, but the rider is not in the car.” 3. “The rider is in the vehicle being taken to their destination”. If any of these occurrences are taking place, no coverage will be afforded under a traditional personal Auto Insurance policy. However, the insurance world is constantly changing, and some carriers have created “rideshare” policies. You would still want to work with an agent to determine if any coverage gaps exist under this type of policy. UBER or LYFT should also have an option that you can purchase to fill in the above-mentioned coverage gaps.
When I signed up for UBER insurance, it says I have Contingent Collision & Comprehensive coverage. What does that mean?
This means that your Comprehensive & Collision coverage for your vehicle will be secondary to your personal Auto Insurance policy. You will first have to file a claim under your personal Auto Insurance policy, and if the claim is denied then your coverage from UBER will kick in. Ultimately this will create a lengthy claims process, all the while your vehicle remains damaged. Just be aware the process could be a lengthy one.
What happens if my personal Auto Insurance company finds out I drive for UBER or LYFT?
Most likely your policy will be non-renewed, or result in a premium increase. Personal Auto Insurance carriers do not want to have any association with “livery” “chauffeur” risks, unless you have a “rideshare” policy that accommodates the coverage. Make sure you communicate with your insurance agent on what purpose you will be using your vehicle for. Your agent will find you a company, or policy type that will meet your needs.
How much will my insurance cost?
This will depend on many factors such as: driving record, vehicle type, coverage requested, and where you live/operate. You will want to make sure that your policy meets the requirements of UBER or LYFT. I expect as time passes, the cost for “rideshare” policies will continually decrease since insurance carriers will gain more experience insuring this specific type of risk.
Luckily the insurance carrier world is catching up with the needs of UBER and LYFT drivers. With the right information, and a great relationship with an insurance agent, you should be able to be properly covered without breaking the bank. If you still have questions, please feel free to contact us. We look forward to hearing from you.