Separate auto insurance is typically advised when driving for Uber or Lyft
With millions of Americans driving for ride-sharing companies, chances are you or someone you know is driving for Uber or Lyft. From newly minted college graduates to parents in need of flexible schedules, many people view ride-sharing as an easy way to make some extra money. Before you grab your keys and sign-up, Hunter Insurance would like to warn you about the insurance pitfalls of ride-sharing.
“Any driver who has been involved in an automobile accident while using a ride-sharing platform may advise you to check what your auto insurance policy will cover,” said Brian Hunter, president of Hunter Insurance. “Most drivers are under the false impression that their standard policy will protect them in the event of an accident, but this is not necessarily the case.”
Hunter is referring to the limited liability coverage that ride-sharing drivers are automatically enrolled in when they begin ferrying passengers. The drawback to this type of coverage is that they become active in very specific scenarios. To illustrate this example, imagine turning on a ride hailing app on your smartphone so you can start working. While listening to music, your phone dings to alert you of a potential rider who is nearby. As you pull out of the curb to pick up the traveler, you are side swiped by an incoming car and you immediately call your ride hailing company to cancel your current pick-up request because you have been involved in an accident.
At this point, you learn that the limited liability insurance you were counting on will not cover the damages from the accident because a passenger was not in your vehicle at the time that it occurred. Making a sour situation worse, your regular auto insurance will not kick-in because you were using your car for a business purpose.
You may be asking, “Where does that leave the driver?”
“These are the types of incidents that can leave drivers financially vulnerable,” Hunter said. Under these circumstances, drivers would be responsible for their own damages and could potentially be responsible for other costs as well.
In an effort to protect their clients, most major insurance companies now offer ride sharing coverage that protects their customers from scenarios like the one mentioned above. Although this coverage is offered at a better rate when compared to commercial policies, many drivers will forgo this coverage entirely because they are not sure how to shop around for better rates or they are uninformed about the gap in insurance.
Before an accident can disrupt your life, Hunter Insurance urges drivers that are using their car for business purposes to consider adding ride-sharing coverage to their auto policy. For all of your auto, home, and business insurance needs, you can count on Hunter Insurance for the best rates and coverage available. Call us at 769.9500 to learn more.