Rideshare insurance: What is it and who needs it?

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Most personal auto insurance policies do not include rideshare insurance, which you will likely want to consider if you drive for companies like Uber or Lyft. There is a common misconception that your personal car insurance policy or employer-provided commercial insurance also covers rideshare insurance, which is the full coverage insurance you might need when you pick up passengers and drive them to their destination for money.

Instead of relying on standard or employer-provided coverage if you are a rideshare driver, you might want to consider opting for additional rideshare insurance from a private insurance company. Bankrate examined how rideshare insurance works and when it might make sense to invest in this supplemental coverage.

Bankrate Insight
  • Rideshare insurance is not typically included with standard auto insurance coverage.
  • Geico, Mercury and Esurance offer standalone rideshare insurance policies, and many other companies offer rideshare insurance endorsements, depending on where you live.
  • Typically, insurance offered by rideshare employers like Lyft or Uber to drivers does not cover you the entire time you are in the car, which is why rideshare insurance may be necessary to fully protect you.

What is rideshare insurance?

Rideshare insurance is a type of car insurance coverage that fills the gap between the commercial car insurance policy provided by your rideshare employer and your personal car insurance. Individual insurance policies do not cover the transport of paying customers from place to place, and employer-provided policies often only cover the minimum and set restrictions on when you are covered. For example, Lyft insurance and Uber driver insurance only extend additional coverage during specific periods, so if you, your vehicle, or other people are injured outside of those windows, you may incur high out-of-pocket expenses as a result.

Though rideshare drivers are not legally required to purchase extra coverage, they can elect to add rideshare insurance for added protection from accidents that cause damage or injury to themselves or third parties. Rideshare drivers are constantly on the road because driving is their livelihood, so it makes sense that they should consider investing in more extensive coverage than the average commuter.

Why Uber and Lyft drivers need rideshare insurance

If your job includes driving paying customers from one place to another, it may be a good idea to purchase rideshare insurance. Since you’ll be left with periods of non-coverage if you rely only on your personal and commercial auto insurance policies, rideshare insurance provides the additional coverage needed to keep you financially protected at all times.

It’s important to know that employer insurance policies do not keep rideshare drivers covered from end to end. Usually, a rideshare employer’s commercial policy only covers you and your vehicle while picking up and dropping off a customer. Ridesharing businesses like Uber and Lyft typically divide coverage periods into the following categories:

  • Offline: When you’re not logged in to your rideshare driver app, or you’re using your vehicle for personal business, you are not covered by commercial car insurance provided by Uber or Lyft. Instead, offline driving is typically covered by your personal car insurance policy.
  • Period 1 – Waiting for Request: If you’re logged in for work with your rideshare company, but you have not been assigned a customer yet, you are ineligible for employer-provided coverage. And since you’re technically on the clock during this time, your personal insurance is also likely to be inactive. This leaves a gap in your insurance coverage, leaving you and your vehicle financially vulnerable should an incident occur.
  • Period 2 – On the Way to Pick Up a Customer: Your commercial insurance kicks in once you accept a customer and start driving to pick them up. However, even though you are covered during this period, rideshare companies tend only to provide limited liability insurance. Both Uber driver insurance and Lyft driver insurance provide bodily injury liability coverage of $50,000 per person, bodily injury liability coverage of $100,000 per incident and $25,000 for property damage coverage.
  • Period 3 – Ride in Progress: Like period two, you’re also covered by your commercial auto policy after you pick up the customer and for the duration of the ride. Upon dropping off your customer, you return to period one status, where you most likely do not qualify for either your personal insurance coverage or your employer-provided coverage.

The top rideshare insurance companies

Many insurance carriers offer some type of rideshare insurance coverage. Some companies offer a rideshare insurance policy similar to your personal auto insurance policy. Others offer a rideshare endorsement, an add-on you can purchase on top of your existing personal car insurance policy. Lastly, some insurance providers can add a TNC extension (Transportation Network Company) onto your car insurance policy for more coverage.

Some of the top providers for rideshare insurance based on Bankrate’s research include these companies and coverage options. Keep in mind that the cost estimated by the car insurance company for rideshare insurance coverage may vary for you and that those advertised rates could change at any time.

  • Allstate: ride-for-hire endorsement
  • Geico: standalone rideshare insurance policy
  • State Farm: TNC endorsement
  • Farmers: rideshare endorsement
  • USAA: rideshare gap coverage endorsement
  • Progressive: rideshare endorsement
  • Mercury: standalone rideshare insurance policy
  • Esurance: standalone rideshare insurance policy
  • Travelers: rideshare endorsement

Keep in mind that rideshare insurance is not available in every state, so it’s crucial to research different providers to determine whether or not this supplemental coverage is an option where you live. If you live in a state where rideshare insurance coverage is unavailable, you might want to consider purchasing commercial insurance to keep you financially protected at all times.

Allstate

  • Type of coverage available: Ride for hire endorsement
  • States available: Alabama, Arkansas, Arizona, California, Colorado, Connecticut, Delaware, Georgia, Hawaii, Idaho, Iowa, Illinois, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Maryland, Maine, Minnesota, Missouri, Mississippi, Montana, North Carolina, North Dakota, Nebraska, New Hampshire, New Jersey, New Mexico, Nevada, Ohio, Oregon, Oklahoma, Pennsylvania, Rhode Island, South Carolina, Tennessee, Texas, Utah, Virginia, Vermont, Washington, Wisconsin, West Virginia, Wyoming, Washington D.C.
  • Carrier’s estimated cost in addition to personal policy premium: $15-$20 annually

Geico

  • Type of coverage available: Ridesharing Policy that replaces existing personal policy
  • States available: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Louisiana, Maine, Maryland, Massachusetts, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming
  • Carrier’s estimated cost in addition to personal policy premium: $25 per month

State Farm

  • Type of coverage available: Transportation Network Company (TNC) Driver Coverage endorsement
  • States available: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Vermont, Virginia, Washington, Washington, DC, West Virginia, Wisconsin, Wyoming
  • Carrier’s estimated cost in addition to personal policy premium: 15-20% above annual premium

Farmers

  • Type of coverage available: Rideshare endorsement
  • States available: Alabama, Arizona, Arkansas, California, Colorado, Delaware, DC, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Maryland, Michigan, Minnesota, Missouri, Montana, Nebraska, Nevada, New Jersey, New Mexico, North Dakota, Ohio, Oklahoma, Oregon, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, Wisconsin
  • Carrier’s estimated cost in addition to personal policy premium: $15 per month, 8% in California

USAA (only available to US military members, veterans and immediate family members)

  • Type of coverage available: Rideshare gap coverage, which is an endorsement added to an existing personal policy
  • States available: Alabama, Arizona, Arkansas, California, Colorado, Connecticut, District of Columbia, Delaware, Florida, Georgia, Idaho, Iowa, Illinois, Indiana, Kansas, Kentucky, Louisiana, Massachusetts, Maryland, Maine, Minnesota, Missouri, Mississippi, North Dakota, Nebraska, New Hampshire, New Jersey, Nevada, Ohio, Oklahoma, Tennessee, Texas, Utah, Vermont, Washington, West Virginia, Wisconsin, Wyoming
  • Carrier’s estimated cost in addition to personal policy premium: $6-$8 per month

Progressive

  • Type of coverage available: Rideshare endorsement
  • States available: Alabama, Arizona, Arkansas, Colorado, Florida, Georgia, Idaho, Illinois, Indiana, Iowa, Kentucky, Louisiana, Maine, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Nebraska, New Mexico, North Dakota, Ohio, Oklahoma, Pennsylvania, Rhode Island, South Dakota, Tennessee, Texas, Utah, Virginia, Washington, Washington D.C., West Virginia, Wisconsin, Wyoming
  • Carrier’s estimated cost in addition to personal policy premium: Calculated based on miles driven while working as a rideshare driver

Mercury

  • Type of coverage available: Standalone rideshare insurance policy
  • States available: Arizona, Georgia, Illinois, Nevada, New Jersey, New York, Oklahoma, Texas, Virginia
  • Carrier’s estimated cost in addition to personal policy premium: Starting at $0.90 per day

Esurance

  • Type of coverage available: Standalone rideshare insurance policy
  • States available: California, Illinois, New Jersey
  • Carrier’s estimated cost in addition to personal policy premium: Calculated based on miles driven while working as a rideshare driver

Travelers

  • Type of coverage available: Rideshare endorsement
  • States available: Colorado, Illinois
  • Carrier’s estimated cost in addition to personal policy premium: Calculated based on miles driven while working as a rideshare driver

How much is rideshare insurance?

It’s difficult to determine an average price for rideshare insurance because the cost varies by state and company. Additionally, any car insurance premium is affected by rate factors, such as driving history, geographic location, claims history, the age of your car and more. It also depends on the type of policy you have. A standalone rideshare insurance policy will also likely be more expensive than a rideshare add-on to your existing policy. Consider contacting companies that offer rideshare insurance near you to get a quote to determine your actual rates.

How to buy rideshare insurance

Some car insurance companies allow you to extend your personal insurance policy or add a new TNC policy through their websites or online portals. Others, like Farmers, require you to call and speak to an agent. When discussing coverage options with your insurer, be sure to tell them you are working as a rideshare driver. They’ll give you a personalized quote based on your location, personal information and driving history. It’s a good idea to find and compare price quotes from multiple providers to determine which company can give you the best rate.

Frequently asked questions

Do I need to tell my car insurance company that I am driving for Uber or Lyft?

Suppose you want your car insurance policy to keep you covered from the start of your workday until the end. In that case, you should inform your auto insurance provider that you are a rideshare driver so you can add on extra endorsements or purchase a separate policy as needed.

What if rideshare insurance is not offered in my state?

If rideshare insurance isn’t an option in your state, consider purchasing a commercial insurance policy. Though commercial policies are more expensive, they should provide the needed coverage to keep you financially protected.

Do I need extra rideshare insurance if I already have personal and employer-provided policies?

Even with personal policy coverage and employer-provided insurance, you can be left vulnerable during certain parts of your workday as a rideshare driver. Rideshare insurance bridges the gap between those two policies, keeping you safe even when you aren’t transporting a customer.

Do contract delivery drivers need rideshare insurance?

When it comes to car insurance, contract delivery drivers are often similar to rideshare drivers. If you deliver for a service like Uber Eats or GrubHub, you are only covered by your personal car insurance policy during certain times. For instance, you might be covered while driving to a restaurant to pick up an order but not covered while logged into the app and waiting to accept an order. Because of that, purchasing rideshare insurance as a delivery driver could be important to protect yourself financially. Speak with an insurance agent at your preferred company to determine whether you need rideshare insurance coverage if you are a delivery driver.

Written by
Lena Borrelli
Insurance Contributor
Lena Muhtadi Borrelli has several years of experience in writing for insurance domains such as allconnect, Healthline and Reviews.com. She previously worked for Morgan Stanley.
Edited by
Insurance Editor