Ride Sharing and Auto Insurance
If you are like many Americans you are looking for an easy way to make a few extra dollars. Insert: ride sharing! What is ride sharing? It is a taxi type service that connects drivers and riders through a smartphone app. Ride sharing vehicles use their own car to pick up people and drive them to a destination. The most popular ride sharing companies are Uber and Lyft. Ride sharing is different from livery and taxi services because both of these types of transportation services have commercial license plates and commercial auto insurance.
Personal auto policies typically exclude livery services from coverage. A personal auto policy assumes you only drive family and friends, do not collect a fee and usually drive around 12,000 miles a year. A personal auto policy stops coverage from the moment the driver logs on to the ride sharing app to the moment he/she logs off. There is a significant uptick in drivers wanting to earn extra money by working for Uber or Lyft. The insurance industry has consequently responded with options. There are currently 2 options: an endorsement on your personal auto policy or a commercial auto policy.
At Mancuso-Nowak we have been placing our customers with carriers that offer the ride sharing endorsement to their personal auto policy. The ride sharing endorsement is called Transportation Network Company (TNC) Endorsement. The TNC Endorsement provides coverage from when the policyholder turns on their ride sharing app until the time they accept a fare. This endorsement fills that gap in coverage that exists with a non-endorsed policy that excludes livery services.
The other option for insureds is a commercial livery policy. A commercial auto policy will carry higher liability limits. It will also be underwritten to take into consideration that the driver is taking passengers for pay and will be traveling more than a personal passenger driver.
Both Uber and Lyft offer auto insurance coverage, but the coverage is very minimal. If you are a ride share driver it is in your best interest to get your own coverage. So if you are going to get your side hustle on as an Uber driver, please contact us so we can make sure you have the proper insurance coverage!