Insurance for Ride-Share Drivers

Ride-sharing has become increasingly popular all across the country, and Uber, especially, is making a real push to hire new drivers here in North Carolina. Making extra money by using your personal vehicle to give rides to strangers may sound like a great idea, but it's important to go into this arrangement with a complete understanding of the ride-sharing insurance implications you face. For many insurers, a personal vehicle insurance policy excludes coverage for drivers using their vehicles for commercial purposes, which is what driving for hire is considered.

Although ride-share companies, such as Uber and Lyft, legally defined as “Transportation Network Companies (TNCs),” provide a certain amount of ride-sharing insurance for their drivers, they have gaps in their protection that should be addressed. Consider these facts:

• Ride-share company coverage provides limited liability protection and no collision or comprehensive coverage while a driver has his or her ride share app turned on and is waiting for a fare request.
• If a fare request has been accepted and the driver is on the way to pick up that fare or has already done so, the company coverage includes both liability (typically up to $1 million) and collision coverage, but there's a significant deductible involved when making a claim.
• Uber and Lyft company ride-sharing insurance typically doesn't kick in until a driver's personal insurance policy fails to cover damages or losses. Many personal insurers may refuse to cover an accident and may even cancel your coverage when they find out you drive for a ride-sharing company, especially if you never notified them of your ride for-hire-working arrangement.

Fast Changes

With TNCs expanding rapidly all over, insurance companies and state insurance departments are taking a close look at this new type of transport business and how current insurance provisions affect it. Drivers can always obtain commercial vehicle insurance to protect themselves while performing ride-sharing activities, but this type of insurance may be too expensive for most drivers to easily afford. Fortunately, several top-name insurance companies are now offering ride-sharing insurance coverage to protect drivers and their passengers alike. The availability of this type of coverage varies state-by-state. but it is available in North Carolina and, more importantly, right here in the Triad region. If you're considering becoming a ride share driver, your trusted insurance broker should be able to answer your questions.