Auto Insurance for Uber, Lyft, and Delivery Drivers—What You Need to Know

The gig economy has transformed the way we work, offering flexible opportunities to earn money by driving for Uber, Lyft and other delivery platforms. Understanding the nuances of auto insurance for rideshare and delivery drivers is crucial to protecting yourself, your vehicle and your passengers or goods.

Understanding Standard Auto Insurance Limitations

Standard personal auto insurance policies are typically not designed to cover commercial activities such as ridesharing or delivery driving. If you use your vehicle for these purposes without proper coverage, you might find yourself without protection in case of an accident. Personal policies may exclude coverage when the vehicle is being used for business activities, meaning any claims made while driving for Uber, Lyft or delivery services could be denied.

The Basics of Rideshare and Delivery Insurance

Rideshare and delivery drivers need specialized insurance policies to bridge the gap between personal auto insurance and the commercial coverage provided by the rideshare or delivery companies. These specialized policies are often called rideshare or delivery driver insurance.

Insurance coverage for rideshare drivers is generally divided into phases:

• App on, no passenger—When you have the rideshare app on and are waiting for a ride request, personal auto insurance typically does not cover you, but the rideshare company may provide limited liability coverage, often insufficient to cover major accidents.
• En route to pick up—Rideshare companies like Uber and Lyft offer higher liability coverage during this period, but you might still need additional coverage for comprehensive and collision.
• Passenger in car—When a passenger is in the car, rideshare companies may provide their highest level of coverage, including liability, comprehensive and collision, often with specific deductibles.

Delivery Drivers and Insurance

Delivery drivers for services like Uber Eats, DoorDash and Instacart face similar insurance challenges. Personal auto insurance policies may not cover accidents that occur while delivering goods. Some delivery companies provide limited coverage, which often mirrors the phases and limitations of rideshare insurance.

How to Get Appropriate Auto Insurance for Ridesharing and Delivery Jobs

Additional coverage is essential for filling the gaps left by the rideshare or delivery company’s insurance.

Rideshare insurance is a tailored solution that combines personal auto coverage with additional protection when drivers are logged into a ridesharing app but aren’t covered by the company’s policies. This hybrid approach can help bridge gaps left by Uber, Lyft and other rideshare companies’ coverage.

Contact Us

Contact Morais Agency in Chester, NY for a personalized car insurance quote.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.