Rideshare and Delivery Driver Insurance - The Basics

What is rideshare insurance? ‍
You may have asked yourself, do I need rideshare insurance? Rideshare insurance is a specialized type of auto insurance designed to provide coverage for individuals who drive for rideshare and delivery companies such as Uber, Lyft, Doordash, Grubhub or similar services in the gig economy. Standard personal car insurance policies typically do not cover any commercial activities. Therefore, if you're using your personal vehicle to offer ridesharing services and an accident occurs while you have a passenger or a transporting food, your regular auto insurance might not cover the damages or liabilities.

Insurance for ridesharing fills this gap by providing coverage during the different stages of the ridesharing process. Here is how rideshare insurance works:

Period 1:  This is when you are driving your vehicle for personal use, with the ridesharing app off. Your regular personal auto insurance carrier will typically cover you during this period.

Period 2:  This starts when you turn on the ridesharing app and are waiting for a ride request. At this stage, your personal auto insurance may not provide coverage, or if it does, the coverage may be limited.

Period 3:  This covers you from the moment you accept a ride request until you drop off the passenger(s) or food. During this period, your personal auto insurance is unlikely to cover you, and the ridesharing company's insurance policy typically provides contingent coverage with specific limitations.

**Note that Uber, Lyft, DoorDash and Grubhub all vary on what and when they will cover you. Each Gig company handles their insurance/reinsurance differently.

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Why do you need rideshare insurance?

1.  Proper coverage: Rideshare insurance ensures you have adequate coverage while driving for a ridesharing service, especially during Period 2 and Period 3 when your personal auto insurance might not apply.
2.  Comply with requirements: Many ridesharing companies require their drivers to have specific insurance coverage, including rideshare insurance, to ensure the safety and protection of both drivers and passengers.
3.  Avoid coverage gaps: Without rideshare insurance, you could be left financially responsible for any damages or injuries that occur during the periods when your personal auto insurance doesn't cover you.
4.  Peace of mind: Rideshare insurance provides peace of mind knowing that you are adequately protected while using your vehicle for ridesharing purposes, reducing the risk of potential financial hardships resulting from accidents or legal liabilities.
5.  It's essential to speak with your insurance provider to understand your current policy's limitations and whether you need to add rideshare coverage or a rideshare endorsement. Like all insurance, the requirements will vary between state and rideshare / delivery service.

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