Drivers and riders have embraced the ridesharing economy, but before you jump on that bandwagon and offer your driving services, make sure you understand how your insurance coverage works.
Doesn't my personal auto insurance policy work — no matter why, when or who I’m driving?
The short answer is, no. If you are "unavailable for hire," according to your rideshare app, then your personal auto insurance policy applies. In any other availability status, such as "matched with rider" or "transporting," your personal auto insurance policy may not provide any coverage or only limited coverage.
But the rideshare company provides insurance. Why do I need extra coverage?
Most insurance provided by rideshare companies works only in a couple of conditions. If the app is off, that rideshare insurance does not provide coverage. If the app is on, and you are waiting for a match, there’s generally a small amount of liability coverage provided. Once you’re matched with a rider or giving a ride, higher coverage may kick in — but it doesn’t extend to damages to your car, and policy limits may vary by state and company.
After the rideshare insurance coverage is purchased, your status on the rideshare app determines coverage. If the app is on and you’re available for hire, coverage extends from your personal auto policy and may include liability coverage for property damage and injury to others, physical damage coverage for damage to your car, and emergency roadside service. Once you’re matched with a rider or are transporting him or her, the same coverage — minus liability to others — may apply. (Actual limitations may vary by state.) This coverage endorsement typically adds about 15% to 20% to your current premium. 2
Will my deductible change if I add Rideshare Driver Coverage?
The deductible you have for any Collision Coverage or Comprehensive Coverage on your policy will not change by adding Rideshare Driver Coverage.1
Before you become a rideshare driver, it’s best to check with your State Farm agent for detailed coverage questions, as states have different limits and requirements.
The described State Farm Rideshare Driver Coverage is provided by the State Farm "Transportation Network Company Driver Coverage" endorsement. This e-newsletter provides only a general description of coverages and is not a statement of contract. All coverages are subject to all policy provisions and applicable endorsements. For more information, see your State Farm agent. 1