Driving for rideshare companies like Uber or Lyft can be a great way to earn extra income. However, many drivers are surprised to learn that their personal auto insurance policy may not fully cover them while working for a rideshare company.
Understanding how insurance works for rideshare drivers is essential to avoid serious coverage gaps.
Most Personal Auto Policies Exclude Rideshare Driving
A standard personal auto policy is designed to cover personal use only. Once you start using your vehicle for commercial purposes, such as transporting passengers for Uber or Lyft, many policies apply a “livery exclusion.”
This means your insurance company may deny a claim if an accident occurs while you are working as a rideshare driver.
Examples of situations that may not be covered:
- Driving with the rideshare app turned on
- Waiting for a ride request
- Driving to pick up a passenger
If your insurer determines you were using the vehicle for rideshare without proper coverage, they could deny the claim or even cancel your policy.
Uber and Lyft Insurance Coverage
Both Uber and Lyft provide insurance, but the coverage depends on what stage of the ride you are in.
Period 1 – App On, Waiting for a Ride
Limited liability coverage applies:
- $50,000 bodily injury per person
- $100,000 bodily injury per accident
- $25,000 property damage
However, this coverage only applies after your personal insurance denies the claim.
Period 2 – Ride Accepted
Once you accept a ride request, the coverage increases significantly.
Typical coverage includes:
- $1,000,000 liability coverage
- Uninsured / underinsured motorist protection
- Contingent collision coverage (if you carry it on your personal policy)
Period 3 – Passenger in the Vehicle
When a passenger is in the car, Uber and Lyft provide their highest level of coverage, including:
- $1,000,000 liability coverage
- Uninsured motorist protection
- Collision and comprehensive (with deductible)
Why Many Drivers Buy Rideshare Insurance
Because of the coverage gaps between personal insurance and rideshare company coverage, many drivers purchase a rideshare endorsement.
Rideshare insurance helps cover the gap between:
- Your personal auto policy
- The insurance provided by Uber or Lyft
Benefits can include:
- Coverage while waiting for ride requests
- Protection for your vehicle
- Lower deductibles than rideshare company policies
How Much Does Rideshare Insurance Cost?
The good news is that rideshare coverage is usually affordable.
In California, it typically costs about:
$15 – $40 per month
The exact price depends on:
- Your driving record
- Vehicle type
- Insurance carrier
Final Thoughts
If you drive for Uber or Lyft, relying only on your personal auto insurance could leave you exposed to serious financial risk. Understanding the different coverage periods and adding a rideshare endorsement can help ensure you are properly protected.
✅ Need rideshare insurance in California?
Starwest Insurance helps rideshare drivers in Orange County, Los Angeles County, and Riverside County find affordable coverage that fills the gap between personal auto insurance and rideshare company policies.
If you drive for Uber or Lyft and want to make sure you’re properly protected, our team can help you review your options and get the right coverage.