The vast majority of people using ride-sharing apps like Uber or Lyft don’t ask themselves important questions like, “Whose insurance will cover my injuries if we get into an accident?” or, “What if there isn’t enough coverage or any insurance at all?”

It is also common to see situations where an Uber or Lyft driver strikes another vehicle or pedestrian. Regardless of the specifics, it’s important to know what happens in any kind of ride-sharing accident.

Fortunately, recent law changes and the implementation of new regulations are helping to ensure that you are covered by insurance in the event of a collision involving an Uber or Lyft driver.

How Rideshare Insurance Works:

Rideshare insurance can be confusing, but we want to help you understand the nuances and complexities of the issue. Here are some of the most common insurance-related “periods” you should be aware of:

  • Period 1: The Uber or Lyft driver has his/her app “ON”, but does not yet have a ride request.

    This period has been an area of great conversation because it was initially considered a “gap” in which there was no insurance coverage. In some states, this may still be the case.

    If an Uber or Lyft driver causes a collision with another vehicle during Period 1, generally the driver’s personal insurance provider would deny coverage since the vehicle was being used for a business purpose.

    Likewise, Uber and Lyft may not provide coverage since the driver does not yet have a passenger. Fortunately, states are beginning to pass laws requiring ridesharing companies to procure insurance coverage during Period 1, typically for a reduced coverage amount around $50,000 per person.

    For now, it is important to note that if you don’t live in a state that requires Uber or Lyft drivers to provide insurance during Period 1, you would have to turn to your own insurance company for “uninsured motorist coverage” (or UM).

  • Period 2: The driver has been notified of a ride request and is en-route to pick up passengers.

    Most states require Uber and Lyft to provide coverage limits of $1,000,000 in the event of bodily injury. Since there are obviously no passengers during this period, this insurance coverage would apply in the event the Uber or Lyft driver is at fault in causing a collision with another vehicle or pedestrian.

  • Period 3: The driver has picked up his passengers and they are en-route to the destination.

    Period 3 falls under the same insurance coverage as Period 2; in other words, Uber and Lyft must provide insurance of $1,000,000 per person.

Additional Considerations

If you are an Uber or Lyft driver and the app is “OFF,” your personal auto policy is the only insurance coverage available; Uber and Lyft insurance does not apply. Further, individuals driving for Uber or Lyft now have the option of purchasing additional insurance, commonly referred to as a “ridesharing endorsement.”

Depending on which state(s) you drive in, it is a good idea to explore a ridesharing endorsement to ensure coverage in the event of a collision during Period 1, or simply so you have “excess” coverage in the event of a serious or deadly accident.

Why You Need an Attorney

If you are an Uber or Lyft driver and the app is “OFF,” your personal auto policy is the only insurance coverage available; Uber and Lyft insurance does not apply. Further, individuals driving for Uber or Lyft now have the option of purchasing additional insurance, commonly referred to as a “ridesharing endorsement.”

Depending on which state(s) you drive in, it is a good idea to explore a ridesharing endorsement to ensure coverage in the event of a collision during Period 1, or simply so you have “excess” coverage in the event of a serious or deadly accident.

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