Ridesharing services (such as Uber and Lyft) use a smartphone application to connect potential passengers with drivers of vehicles for hire. Many drivers who offer this service use their personal vehicle and operate in a part-time capacity. Most insurance companies clearly exclude coverage when the insured is transporting a customer or available for hire; these exclusions apply to all Liability, Physical Damage Coverages, Uninsured/Underinsured Motorist, and Medical Payments coverages. As a result, people who provide ridesharing services will need to invest in specific ridesharing insurance. Contact our office to learn more.
Do ridesharing networks such as Uber and Lyft provide any coverage?
Although these companies may extend coverage to the driver while a passenger is physically in the vehicle, a serious coverage gap exists while the app is running but no passenger has requested a ride. Even when coverage is present from the service provider, the limits provided are typically much lower than the coverage that our customers have come to expect.
Is the coverage primary or excess?
This can vary by insurance company, however, with those companies offering this coverage, it is usually outlined in the Policy Change Endorsement, UM/UIM Endorsement, and Med Pay Endorsement that the coverage is in excess of other collectible insurance. The intent is to close coverage gaps for the insured, not to replace the insurance needs of a third party. This distinction should not impact the customer, but allow the insurance carrier to provide the coverage at a sustainable but affordable price.
Does ridesharing affect commercial auto coverage?
This can vary by insurance company. With ERIE Insurance, your commercial auto policy already provides coverage for commercial ventures. There will, however, be an additional premium charged for the additional exposure.