car
Get Personalized Car Insurance Quotes
car
! *Please enter valid Zip Code
A good driver means:

Have no accidents or violations in the last 3 years.

Don't have a DUI.

Don't need an SR22.

*Please select one

Ridesharing companies like Uber and Lyft have completely transformed transportation.

Millions of people use these services to travel to school, work and social events, and millions of drivers now rely on these companies for employment.

However, while driving for these rideshare companies can generate an income while controlling your own schedule, being a rideshare driver comes with several car insurance considerations. Getting rideshare insurance is one of the most important. 

If you're contemplating driving for Uber or Lyft, here's what you need to know about rideshare insurance.

Why do you need ridesharing insurance?

As a rideshare driver, you operate as an independent contractor. That means you’re essentially running your own business. As a self-employed person, you need to have all the necessary insurance protections to safeguard your business.

However, regular car insurance doesn't cover rideshare drivers when they operate their vehicle for business rather than for personal use. Though ridesharing companies like Uber and Lyft offer insurance, this coverage differs depending on which phase of the trip the driver is in. 

Generally, you can divide ridesharing into three periods:

  • Period 1: App is on but the driver is waiting for a passenger.
  • Period 2: App is on and the driver is going to pick up a passenger.
  • Period 3: App is on, a passenger is in the vehicle and the ride has started.

Uber and Lyft cover their drivers, but this coverage is only in effect once you've accepted a ride request (Period 1) to the time you have a passenger onboard (Period 3). 

However, the insurance’s liability limits are generally low, come with high deductibles that can range anywhere from $1,000 to $2,500 and include several coverage gaps that can increase your out-of-pocket costs if you were to get into an accident or have medical bills related to an accident that occurred before or after any of these periods.

This is why rideshare insurance is so important. It can fill these coverage gaps and provide more insurance protection throughout the time you're using your vehicle to pick up passengers for Uber and Lyft -- even in some cases when you haven't turned on the app yet.

 

How does ridesharing insurance work?

If you have your own personal vehicle, you must meet the minimum liability requirements for car insurance in your state. However, these requirements apply for personal use of your vehicle, not for rideshare pick-ups. 

For the initial years after Uber and Lyft first launched, most insurance companies didn't provide liability or comprehensive coverage under one umbrella policy that covered both personal and commercial use of a driver's vehicle. Insurers didn’t want to take on the added risk at that time. 

However, many insurers now either offer:

  • Separate rideshare insurance policies
  • Allow drivers to purchase gap insurance or to add an endorsement to their personal auto insurance policy

With this approach, you can get rideshare insurance from insurers that cover all phases of your trip.

Dan Karr, founder and CEO of Valchoice, a free auto insurance grading tool that helps consumers determine the strengths and weaknesses of their coverage plans, says Uber and Lyft insurance isn't enough for rideshare drivers. Additional coverage is really necessary.

"If [you're] using rideshare insurance through Lyft or Uber, drivers will need to purchase additional coverage in order to insure the full amount of a loan or lease on their vehicle will be paid off in an accident. Otherwise, they could end up in a position where they need to come up with money after an accident," Karr says.

 

Ridesharing insurance policies

One of the main challenges of Uber and Lyft's insurance policies is that they generally come with low coverage limits. Lyft's coverage and Uber’s coverage include:

  • $100,000 of bodily injury coverage per accident 
  • $25,000 of property damage coverage per accident
  • $1 million coverage if you were to get into a covered accident while the app is on. 

The two companies’ liability coverage limits are lower than what’s recommended by experts: 

  • $100,000 of bodily injury coverage per person
  • $300,000 of bodily injury coverage per accident 
  • $100,000 of property damage coverage per accident

Not having that level of coverage means you may have to pay higher out-of-pocket costs if you’re in an accident.

Another challenge is that rideshare coverage varies by state and isn't available everywhere.

For example, Geico's rideshare coverage is only available in 39 states and not in Alaska, Georgia, Hawaii, Kentucky, Nevada, New Jersey, New York, North Carolina, Texas and Utah.

Also, some insurers offer coverage for all three periods, while others don't. Geico provides coverage for every phase of your trip, while Allstate's rideshare endorsement only offers coverage during period 1. You'd have to file a claim with Uber or Lyft if you had an accident during the other two periods. 

Allstate provides some reimbursement to help you cover the deductible for your claim through Uber or Lyft's insurance.

It's important to weigh all these factors when choosing between rideshare policies.

 

Ridesharing insurance by state

Let’s look at the differences by company and state, as of March 2020:

State Company Period of Coverage
AlaskaNoneNone
AlabamaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
ArizonaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
Mercury InsuranceAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
ArkansasAllstateAll
Farmers InsurancePeriod 1
GeicoAll
State FarmAll
USAAPeriod 1
CaliforniaAllstateAll
EsurancePeriod 1
Farmers InsurancePeriod 1
GeicoAll
Mercury InsuranceAll
MetlifeAll
State FarmAll
USAAPeriod 1
ColoradoAllstateAll
Farmers InsurancePeriod 1
GeicoAll
MetlifeAll
SafecoPeriod 1
State FarmAll
TravelersPeriod 1
USAAPeriod 1
ConnecticutAllstateAll
GeicoAll
Liberty MutualAll
State FarmAll
DelawareAllstateAll
FarmersPeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
District of ColumbiaAllstateAll
ErieAll
USAAPeriod 1
GeicoAll
State FarmAll
USAAPeriod 1
FloridaFarmers  (Foremost)Period 1
GeicoAll
MercuryAll
State FarmAll
USAAPeriod 1
GeorgiaAllstateAll
FarmersPeriod 1
MercuryAll
ProgressiveAll
State FarmAll
USAAPeriod 1
HawaiiAllstateAll
FarmersPeriod 1
IdahoFarmersPeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
IllinoisAllstateAll
ErieAll
FarmersPeriod 1
GeicoAll
Mercury InsuranceAll
MetlifeAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
TravelersPeriod 1
USAAPeriod 1
IndianaAllstateAll
ErieAll
FarmersPeriod 1
GeicoAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
IowaAllstateAll
FarmersPeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAAll
KansasAllstatePeriod 1
Farmers InsurancePeriod 1
GeicoAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
KentuckyAllstateAll
ErieAll
ProgressiveAll
State FarmAll
USAAPeriod 1
LouisianaAllstateAll
GeicoAll
State FarmAll
USAAPeriod 1
MaineAllstateAll
GeicoAll
Liberty MutualAll
ProgressiveAll
State FarmAll
USAAPeriod 1
MarylandAllstateAll
ErieAll
FarmersPeriod 1
GeicoAll
State FarmAll
USAAPeriod 1
MassachusettsAllstateAll*
GeicoAll
Liberty MutualAll
ProgressiveAll
USAAPeriod 1
MichiganFarmers InsurancePeriod 1
ProgressiveAll
State FarmAll
MinnesotaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
MississippiAllstateAll
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
MissouriAllstateAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
MontanaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
State FarmAll
NebraskaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
NevadaAllstateAll
Farmers InsurancePeriod 1
Mercury InsuranceAll
State FarmAll
USAAPeriod 1
New JerseyAllstateAll
Farmers InsurancePeriod 1
State FarmAll
USAAPeriod 1
New HampshireAllstateAll
GeicoAll
Liberty MutualAll
State FarmAll
USAAPeriod 1
New MexicoAllstateAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
State FarmAll
North CarolinaAllstateAll
North DakotaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
OhioAllstateAll
ErieAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
OklahomaAllstateAll
Farmers InsurancePeriod 1
GeicoAll
Mercury InsuranceAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
OregonAllstateAll
FarmersPeriod 1
GeicoAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
PennsylvaniaAllstateAll
ErieAll
FarmersPeriod 1
GeicoAll
ProgressiveAll
State FarmAll
Rhode IslandAllstateAll
GeicoAll
Liberty MutualAll
ProgressiveAll
South CarolinaAllstateAll
GeicoAll
Liberty MutualAll
State FarmAll
South DakotaFarmersPeriod 1
TennesseeAllstateAll
ErieAll
Farmers InsurancePeriod 1
GeicoAll
ProgressiveAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
TexasAllstateAll
Farmers InsurancePeriod 1
MercuryAll
MetlifeAll
ProgressiveAll
State FarmAll
USAAPeriod 1
UtahAllstateAll
Farmers InsurancePeriod 1
SafecoPeriod 1
State FarmAll
USAAPeriod 1
VermontAllstateAll
GeicoAll
Liberty MutualAll
USAAPeriod 1
VirginiaAllstateAll
ErieAll
FarmersPeriod 1
GeicoAll
ProgressiveAll
State FarmAll
WashingtonAllstateAll
GeicoAll
MetlifeAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
West VirginiaAllstateAll
ErieAll
FarmersPeriod 1
GeicoAll
ProgressiveAll
State FarmAll
USAAPeriod 1
WisconsinAllstateAll
ErieAll
Farmers InsurancePeriod 1
GeicoAll
SafecoPeriod 1
State FarmAll
USAAPeriod 1
WyomingAllstateAll
GeicoAll
State FarmAll
USAAPeriod 1

 

Rideshare drivers and insurance: Many still lacking coverage

Despite the possibility of being underinsured, many rideshare drivers don't have enough cover.

Carinsurance.com Senior Consumer Analyst Penny Gusner offers the following tips to ensure you have sufficient coverage:

  • Review your personal policy, as well as what is offered by the ridesharing company, and be sure there are no gaps in coverage, especially during the time your app is on and you're waiting for a customer to ask for a ride.
  • Regardless of whether your ridesharing coverage applies to the entire time you're on the job or not, you still must tell your personal insurance company that you are working for a ridesharing service, otherwise you risk having your own policy canceled.
  • Buy liability limits on your own policy as follows: $100,000 to pay for injuries to others in an accident you cause; $300,000 per accident; $100,000 to pay for damage to other cars and property
  • Uninsured/underinsured motorist covereage is required in some states, and others allow you to reject it. Don’t. If you are in an accident and the other driver is at fault but doesn’t have car insurance, uninsured motorist covers your injury-related medical expenses and those of your passengers. It can cover your lost wages and pain and suffering. If the driver who hit you has insurance, but low limits, underinsured coverage will cover the difference. Choose coverage amounts that match your own liability limits.