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Do I need car insurance for an Uber?

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Here's what you need to know...
  • Uber is a ridesharing service
  • Drivers for these services use their personal vehicles to shuttle passengers from one location to another
  • While the service operates similar to a taxi, the insurance risk is different
  • Some of these rideshare services may provide primary auto insurance to their drivers
  • However, there are coverage options that may not be available through these services

Uber is an excellent way to use your personal car to make some extra money or even function as a full-time job.

As services like Uber become more popular, concerns around the insurance risks faced by drivers have come up countless times.

If you are considering driving for Uber, it’s important to determine what kind of insurance coverage you may need.

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What is Uber?

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Uber is a transportation network company, or more commonly known as a ridesharing service. Services like this are normally operated by a driver using their personal vehicle, and passengers request the service through a mobile application or website.

One of the biggest things that make this service different than a traditional taxi service is the use of personal vehicles rather than company-owned vehicles.

In addition to the use of personal vehicles, the requirements at the state and local levels are much different for ridesharing services. Taxi services, for instance, require licensing, vehicle inspections, and liability insurance that protects the passengers.

Ridesharing services such as Uber do not fall within these same requirements, meaning they may not offer the same protections to passengers or third parties.

Do services like Uber provide insurance coverage?

Services like Uber often provide primary insurance to drivers, but these amounts of coverage may not fully protect drivers from physical damages or liability incidents.

In addition to physical damages or liability incidents, services like Uber usually do not provide coverage for uninsured or underinsured drivers.

This means that being involved in an accident with one of these drivers could leave you paying out of pocket for damages or injuries.

When you begin driving for a service like Uber, it’s important to start asking questions about the coverage optionsĀ available to you, as well as any coverage that is your responsibility. Also, ask them about the claim process and whether their insurance would act as the primary coverage.

Understanding what situations you are protected in will help you shop around for insurance that meets your needs.

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Will your personal auto policy provide coverage while driving for Uber?

While some rideshare companies may require personal auto insurance to drive for them, there is still confusionĀ around when your personal policy provides coverage and when a commercial policy would provide coverage.

Insurance providers and legislators have recognized that there is a lack of understanding regarding this coverage gap and are actively working to define what is legally required to drive for ridesharing services like Uber.

Although they are working towards a solution, some insurance providers are hesitant to provider coverage until they fully understand the exposure risk services like Uber introduce.

How do you protect yourself from liability risks?

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One of the most important things to do is to protect yourself from liability or property damage incidents.

When you begin driving for a service like Uber, it’s important to talk to any potential insurance provider about the coverage options available.

As ridesharing services have grown in popularity, some insurance providers offer specialty coverage designed for the unique exposure risks a rideshare driver is exposed to.

In addition to purchasing coverage designed for services like Uber, legislation is beginning to come into play to help regulate these types of companies.

In some states, it is required that proof of insurance is visible anytime a driver is operating the ridesharing application. Also, it may be required to report to your insurance provider that you were working as a rideshare driver if you are involved in an accident.

Risks of Ridesharing

Ridesharing services like Uber are a heavily relied on service in many areas, which means drivers for these companies need to understand the risks they’re taking on. These risks include low insurance limits, the risk to their personal vehicle, and risk to their passengers or a third party.

Lawmakers are still working out how these ridesharing services will be required to operate in many regards, including insurance requirements.

While every state has different insurance regulations already in place, this makes defining how services like Uber operate even more difficult. If you have questions about how your coverage works as an Uber driver, contact your insurance provider or your state’s Department or Insurance.

If you are searching for car insurance coverage, enter your zip code below to compare rates from top companies today!

Free Car Insurance Comparison

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or call (855) 977-0861 for free quotes