You’ve decided to transform your car into your own personal taxi service, which means transporting lots of people to different locations. Whether you work for Uber, Lyft, or another rideshare service, you’ll need a special kind of insurance coverage to protect you and your passengers. Having ridesharing insurance is the key to helping your rides and your business run smoothly.
Independent insurance agents are here to help set you up with the right rideshare coverage for your needs. They'll equip you with coverage long before it's time to use it. But first, let’s start with an overview of rideshare insurance and what it's all about.
What Is Ridesharing Insurance?
Rideshare insurance or ridesharing insurance is a special type of car insurance designed to cover drivers who share their personal vehicles with riders as a paid service. Personal auto insurance policies won't cover drivers who transport paying passengers. Rideshare drivers must have insurance to protect themselves, their vehicles, and their riders.
Once you activate your rideshare app, you also activate an exclusion in your personal auto policy that makes it stop covering you, since you're now operating your vehicle for business purposes. Ridesharing insurance is a hybrid policy designed to fill in the gaps between your personal auto insurance and the coverage provided by your rideshare employer like Uber, etc. An independent insurance agent can help you get set up with the right kind of rideshare insurance for you.
How Much Does Ridesharing Insurance Cost?
The cost of ridesharing insurance depends heavily on the insurance provider. Some policies offer rideshare coverage for $15 per month, while others offer comparative coverage for as low as $15 per year. Other carriers, however, charge a percentage (e.g., 15% to 20%) of your personal auto policy’s premium for added rideshare coverage.
Ridesharing insurance costs depend on the following factors:
- The value of your car: More expensive vehicles tend to cost more to repair or replace, so rideshare coverage is often pricier for them.
- Your driving record: If you have a history of accidents or traffic violations, you're likely to pay much more for your rideshare coverage, similar to regular auto insurance.
- Your location: Your location also influences the cost of your rideshare insurance based on factors like crime rates and more.
An independent insurance agent can help you find exact ridesharing insurance quotes for your area.
What Does Ridesharing Insurance Cover?
Ridesharing car insurance operates differently during each phase of a rideshare experience. These phases are referred to as “periods,” each associated with its own level of coverage through your personal auto insurance policy, your rideshare policy, or the rideshare company’s coverage.
Before you activate the rideshare app and start looking for customers, your auto insurance policy covers you completely. While you’re on the job, rideshare coverage periods are defined as follows:
- Period 0: The rideshare app is off, and you're driving for personal reasons.
- Period 1: The rideshare app is on, and you’re driving around, waiting for someone to request you.
- Period 2: You’ve received a ride request notification and are en route to pick up your paying passenger.
- Period 3: The rider is in your car, and you’re transporting them to their destination.
Here’s the breakdown of what coverage looks like for each rideshare period:
- Period 0: Your personal auto policy fully covers you while the rideshare app is off.
- Period 1: You have the rideshare app on, so your personal auto insurance policy no longer covers you. Uber's and Lyft’s coverage is severely limited to liability only. If you get into an accident during this phase, your rideshare policy will fill in the gap between your personal auto policy and the rideshare employer’s coverage. Rideshare insurance covers things like property damage, vehicle repairs, and medical expenses if you get injured.
- Period 2: You've got a ride request and are headed to pick up your rider. The rideshare employer's policy fully covers you.
- Period 3: Your rider is in your car, and you're headed to their final destination. The rideshare employer's policy fully covers you.
The coverage provided by rideshare employers Uber and Lyft are very similar, but they come with different deductibles for their collision and comprehensive coverages. Uber has a lower deductible amount, at $1,000, while Lyft's is $2,500. An independent insurance agent can further explain how rideshare insurance covers you and when you need it.
Who Has the Best Ridesharing Insurance of 2024?
Fortunately, rideshare insurance is offered by many top insurance companies. Also, due to the COVID-19 pandemic, many major car insurance carriers have modified their policies to include coverage for drivers that deliver customers products like medicine, food, and essentials for various companies.
That doesn't apply to all car insurance carriers, however. You'll want to double-check your specific policy to be sure. Until then, here are just a handful of our top insurance company picks for ridesharing insurance.
- Best overall: USAA
- Best for coverage options: Progressive
- Best for claims processing: Travelers
- Best for coverage territory: Allstate
- Best for mobile app users: Nationwide
An independent insurance agent can help you find a rideshare insurance policy from one of these major carriers or a different provider that best meets your needs.
Best Overall Ridesharing Insurance Company: USAA
USAA has long had a reputation for customer satisfaction and consistently excellent claims handling. The carrier's ridesharing insurance offers comprehensive coverage for Lyft drivers, Uber drivers, and drivers that work for app-based delivery companies.
Pros and Cons:
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Available for Uber, Lyft, and app-based delivery company drivers |
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Coverage not available nationwide |
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Flexible deductible |
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Customers must either be active or retired military or have a family member in this category to be eligible for coverage |
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Flexible coverage limits |
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Outstanding customer reviews and claims satisfaction ratings |
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Affordable rates |
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Best Ridesharing Insurance Company for Coverage Options: Progressive
Progressive allows existing customers with car insurance policies to add rideshare endorsements. Customers can then keep their Progressive car insurance's perks, like rental car reimbursement coverage, while they're on the clock driving for Lyft or Uber. Progressive also has consistently excellent customer feedback and financial strength ratings.
Pros and Cons:
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Lets you add rideshare endorsements on to existing car insurance policy |
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More expensive rates than other carriers |
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Lets you keep Progressive car insurance benefits while working for ridesharing apps |
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Poor Better Business Bureau (BBB) rating |
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Wide coverage territory |
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Cannot purchase coverage online |
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Offered to rideshare drivers and delivery drivers |
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Best Ridesharing Insurance Company for Claims Processing: Travelers
Travelers has consistently excellent customer feedback for its ridesharing insurance. The carrier maintains outstanding claims processing satisfaction ratings as well. Travelers is also chosen by many drivers thanks to its many endorsement and discount options for car insurance overall.
Pros and Cons:
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Cons: |
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Outstanding customer service ratings |
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Coverage not available nationwide |
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Outstanding claims satisfaction ratings |
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Premium rates can be higher than other carriers |
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Many discounts and endorsements available |
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Best Ridesharing Insurance Company for Coverage Territory: Allstate
Allstate's ridesharing insurance offers the benefit of deductible gap coverage. Thanks to this, Lyft drivers don't have to pay the company's standard $2,500 all on their own if they have to file a claim. But another huge perk of Allstate's ridesharing insurance is that it's available in many states where other carriers don't offer coverage.
Pros and Cons:
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Coverage offered in most states |
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Rideshare coverage only offered to existing Allstate auto insurance policyholders |
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Affordable coverage rates |
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Deductible gap insurance included |
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Best Ridesharing Insurance Company for Mobile App Users: Nationwide
Though rideshare drivers use mobile apps while driving customers to and from their destinations, they also may want to use their insurance company's mobile app to pay bills, file claims, check a claim's status, etc. Not only is Nationwide consistently ranked as excellent in terms of customer service and claims handling, but the carrier offers a highly user-friendly mobile app for customers to pay bills, file claims, and more.
Pros and Cons:
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Outstanding customer service ratings |
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Coverage is not available in a couple of states |
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Outstanding financial strength rating from AM Best |
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Outstanding BBB rating |
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Mobile app offered for bill pay, claims filing, etc. |
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How We Chose Our Top Picks
Trusted Choice reviewed about a dozen ridesharing car insurance companies before ultimately selecting a handful of only the best to recommend to you. We reviewed several factors for each company, including:
- Customer service ratings
- Claims satisfaction ratings
- BBB ratings
- AM Best financial strength ratings
- Coverage territory
- Premium rates
- Coverage options
- Discounts and endorsements available
Though we found these companies to be the best, they may not be right for you. Working with an independent insurance agent can help ensure you get matched to the right ridesharing insurance coverage for your needs.
Does an Uber or Lyft Driver Need Ridesharing Insurance?
Yes, Uber or Lyft drivers need rideshare insurance because of the gap between when personal auto insurance covers you and when your rideshare company's coverage kicks in. During Period 1, drivers can get in trouble if they don’t have additional rideshare coverage. Risks like accidents, etc., that may occur during Period 1 are what make rideshare insurance crucial.
Why Choose an Independent Insurance Agent?
Independent insurance agents simplify the process by shopping and comparing insurance quotes for you. Not only that, but they’ll also cut the jargon and clarify the fine print so you know exactly what you’re getting.
Independent insurance agents also have access to multiple insurance companies, ultimately finding the best ridesharing insurance coverage, accessibility, and competitive pricing while working for you.
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