Why You Need Rideshare Insurance and Which Companies Offer It

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If you’re part of the new gig economy where you can use your car and free time as a side hustle, setting yourself up with rideshare companies to be a Lyft or Uber driver is simple. But what many gig drivers don’t realize is, your basic car insurance doesn’t cover you if you’re getting paid to drive others and cause an accident. Fortunately, the best insurance carriers provide rideshare insurance to fill the coverage gap. 

We reviewed the rideshare insurance companies on the market and weighed several factors such as cost, coverage limits and what policyholders think of the carrier. We dug through the best rideshare insurance available right now, as well as rideshare insurance cost, so you can make an informed decision of which policy will work best for you.

What is Rideshare Insurance?

Rideshare insurance specializes in covering you while you’re driving for rideshare companies such as Lyft or Uber. You’ll need the optional coverage if you plan on picking up a side gig driving others — your personal car insurance won’t cover you while you’re “on  the job”, which is referred to as “commercial” driving by many carriers.

Types of Rideshare Car Insurance Policies

  • Additional coverage: The insurer may offer rideshare car insurance as an optional extra that goes in force when “you’re on” with the rideshare insurance companies. The additional insurance provides excess coverage for whatever the rideshare insurance companies don’t cover. 
  • Hybrid insurance: Instead of having to worry about switching your rideshare insurance on or off when you’re working, hybrid coverage replaces a personal car insurance policy.
  • Personal insurance coverage extension: The extension builds on your personal auto insurance coverage. The extension kicks in during certain stages of the ridesharing trip.

Why Uber, Lyft and Delivery App Drivers Need Rideshare Insurance

Before you decide whether you need rideshare insurance, it’s important to know how coverage works. Rideshare companies do provide their drivers with some rideshare insurance, although coverages vary per company and state. But some delivery apps don’t provide any insurance. Based on this information, you may decide to drive for one company over another — or adjust your car insurance accordingly.

The important thing is finding the right balance between personal car insurance, the rideshare company’s coverage, and purchasing extra rideshare insurance. Say you’re on an Uber or Lyft rideshare and rear-end someone. If your insurance carrier finds out you were working, they will not cover the damage because you were using your personal vehicle for commercial purposes. Even worse, if your customer was injured in the accident, your personal collision coverage won’t pay for their injuries if there’s a claim

If you’re driving for one of the rideshare companies, your Lyft or Uber rideshare insurance will step in. If damages are over the amount the rideshare companies cover, you’ll need rideshare insurance through your personal auto carrier to cover the remainder of the incident.  

Take a closer look at delivery and rideshare insurance limits:

PeriodCoverage Type
0 — In period zero, the rideshare app is turned off and your personal car insurance is in force.Only personal auto insurance is in force.
1 — In period one, the app is on and you’re waiting for the delivery or rideshare companies to send you a pickup.Rideshare companies (Uber and Lyft):$50,000 bodily injury per person$100,000 bodily injury per accident$25,000 property damage per accident.
Doordash and Postmates:No coverage
Uber Eats: $50,000 bodily injury per person$100,000 bodily injury per accident$25,000 property damage per accident.
2 — In period two, you’ve accepted an order or request and you’re on your way.Rideshare companies (Uber and Lyft):Liability coverage: Up to $1,000,000 per accidentUp to your car’s value, as long as you have full (comprehensive and collision) coverage
Doordash:No coverage
Postmates:Liability coverage: Up to $1,000,000 per accident
Uber Eats: Liability coverage: Up to $1,000,000 per accidentUp to your car’s value, as long as you have full (comprehensive and collision) coverage
3 — You’re driving the passengers or in the process of delivering food. Rideshare companies (Uber and Lyft):Liability coverage: Up to $1,000,000 per accidentUp to your car’s value, as long as you have full (comprehensive and collision) coverage
Doordash and Postmates:Liability coverage: Up to $1,000,000 per accident
Uber Eats: Liability coverage: Up to $1,000,000 per accidentUp to your car’s value, as long as you have full (comprehensive and collision) coverage

The Best Rideshare Car Insurance Companies

  • Allstate: Best Uber rideshare insurance
  • Erie: Best rideshare insurance cost
  • Geico: Best hybrid coverage
  • State Farm: Best for delivery insurance 
  • USAA: Best for military members

Allstate

Best Uber Rideshare Insurance

Allstate has partnered with Uber to provide drivers with rideshare coverage, and you can add extra coverage if you drive or deliver with other companies.
  • 4.2/5 Reviews Score
  • $15 Average Premium Pricing data comes from our partners at Coverage.com.
  • A+ AM Best Rate AM Best rates insurance providers creditworthiness. Ratings are based on the provider’s ability to follow through with a payout when a consumer files a claim.
  • 846* J.D. Power J.D. Power scores are based on surveys for customer satisfaction and product quality.

Why we chose it

Allstate has partnered with Uber to provide drivers with rideshare coverage, and you can add extra coverage if you drive or deliver with other companies.

Pros

  • Understands rideshare coverage
  • Can be purchased in minutes
  • Available nationwide

Cons

  • More expensive than other rideshare insurance companies
  • Does not replace a personal auto insurance policy
  • Gap coverage up to $2,500
Read More

Discounts available

Types of Rideshare Coverage Offered

  • Hybrid
  • Additional protection

*J.D. Power’s 2020 U.S. Auto Insurance Study rating for the Southeast region. Based on a 1,000-point scale.

Further Reading on Allstate:

Erie

Best Rideshare Insurance Cost

If you need cheap rideshare insurance, Erie Insurance’s rideshare coverage is among the most affordable, as long as you’re already insured with the regional carrier.
  • 3.6/5 Reviews Score
  • $10 Average Premium Pricing data comes from our partners at Coverage.com.
  • A+ AM Best Rate AM Best rates insurance providers creditworthiness. Ratings are based on the provider’s ability to follow through with a payout when a consumer files a claim.
  • 871* J.D. Power J.D. Power scores are based on surveys for customer satisfaction and product quality.

Why we chose it

If you need cheap rideshare insurance, Erie Insurance’s rideshare coverage is among the most affordable, as long as you’re already insured with the regional carrier.

Pros

  • High customer satisfaction ratings
  • Covers all ridesharing stages
  • Financially solid company

Cons

  • Only available in a small number of states
  • Does not replace a personal auto insurance policy
  • You’ll need to contact Erie to add the coverage
Read More

Discounts Available

Types of Rideshare Coverage Offered

  • Personal coverage extension

*J.D. Power’s 2020 U.S. Auto Insurance Study rating for the Southeast region. Based on a 1,000-point scale.

Further Reading on Erie:

GEICO

Best Hybrid Coverage

If you don’t want to worry about whether you’ve turned on your Uber or Lyft rideshare app to track your insurance coverage, GEICO rideshare insurance is a hybrid coverage to protect you regardless of the type of driving you’re doing.
  • 4.2/5 Reviews Score
  • N/A Average Premium Pricing data comes from our partners at Coverage.com.
  • A++ AM Best Rate AM Best rates insurance providers creditworthiness. Ratings are based on the provider’s ability to follow through with a payout when a consumer files a claim.
  • 857* J.D. Power J.D. Power scores are based on surveys for customer satisfaction and product quality.

Why we chose it

If you don’t want to worry about whether you’ve turned on your Uber or Lyft rideshare app to track your insurance coverage, GEICO rideshare insurance is a hybrid coverage to protect you regardless of the type of driving you’re doing.

Pros

  • Affordable auto insurance
  • Can be purchased online
  • Rideshare insurance and auto coverage in one

Cons

  • Has a deductible of at least $250
  • Not available in 10 states or Puerto Rico
Read More

Discounts available

  • New vehicle
  • Defensive driver

Types of Rideshare Coverage Offered

  • Hybrid

*J.D. Power’s 2020 U.S. Auto Insurance Study rating for the Southeast region. Based on a 1,000-point scale.

Further Reading on GEICO:

State Farm

Best for Delivery Insurance

Delivery insurance only covers the portion of your delivery when you’ve got the goods and you’re on the way. State Farm’s rideshare insurance fills the gaps in coverage.
  • 4.4/5 Reviews Score
  • 10%-20% of personal policy Average Premium Average Premium Pricing data comes from our partners at Coverage.com.
  • A++ AM Best Rate AM Best rates insurance providers creditworthiness. Ratings are based on the provider’s ability to follow through with a payout when a consumer files a claim.
  • 835* J.D. Power J.D. Power scores are based on surveys for customer satisfaction and product quality.

Why we chose it

Delivery insurance only covers the portion of your delivery when you’ve got the goods and you’re on the way. State Farm’s rideshare insurance fills the gaps in coverage.

Pros

  • Covers all stages of your delivery trips
  • High level of customer support
  • Available nationwide

Cons

  • Adds up to 20% to your personal auto insurance policy cost
  • Only covers phase one and two — your company’s insurance will need to provide coverage for phase three
Read More

Discounts available

  • New car
  • Good student

Types of Rideshare Coverage Offered

  • Personal insurance coverage extension

*J.D. Power’s 2020 U.S. Auto Insurance Study rating for the Southeast region. Based on a 1,000-point scale.

Further Reading on State Farm:

USAA

Best for Military

If you’re active or retired military or related to one, you can qualify for USAA membership and one of the least expensive rideshare coverages on the market.
  • 4.4/5 Reviews Score
  • $6 Average Premium Pricing data comes from our partners at Coverage.com.
  • A++ AM Best Rate AM Best rates insurance providers creditworthiness. Ratings are based on the provider’s ability to follow through with a payout when a consumer files a claim.
  • 909* J.D. Power J.D. Power scores are based on surveys for customer satisfaction and product quality.

Why we chose it

If you’re active or retired military or related to one, you can qualify for USAA membership and one of the least expensive rideshare coverages on the market.

Pros

  • Cheap rideshare coverage
  • Best customer satisfaction rating
  • Covers you while your app is “on”

Cons

  • Only available to qualifying military members
  • Does not replace a personal auto insurance policy
Read More

Discounts available

  • Safe driver
  • Length of membership

Types of Rideshare Coverage Offered

  • Personal insurance coverage extension

*J.D. Power’s 2020 U.S. Auto Insurance Study rating for the Southeast region. Based on a 1,000-point scale.

Further Reading on USAA:

What’s the Cost of Rideshare Insurance

When comparing car insurance, you’ll find rideshare insurance is low in cost if it’s an addition to an existing policy. Most carriers charge a monthly fee between $6 and $20, with USAA coming in as the lowest. State Farm operates a little differently, charging 10% to 20% to the cost of your auto insurance rate

How to Buy Rideshare Insurance

It’s important to know what you need before shopping around for rideshare car insurance. Do you need full coverage for the whole time your app is switched on? Or are you in need of a policy to fill the gaps the delivery or rideshare companies don’t provide? Know exactly when you’re not covered through the company and buy accordingly.

Things to keep in mind:

  • Lyft and Uber rideshare companies provide coverage for all phases of work
  • Most delivery companies, such as Doordash and Postmates only provide insurance when you’ve picked up food or a passenger.
  • Standard rideshare liability limits of 50/100/25 may be too low for your needs if you own a home or other assets
  • Liability coverage doesn’t reimburse you for damages to your vehicle
  • Many rideshare insurance coverages require you have an existing auto insurance policy with the carrier

Summed Up

If you’re planning on making some side cash by picking up a gig as a delivery person or Uber driver, you’ll need special coverage, called rideshare insurance. That’s because a standard car insurance policy will not cover you if you cause an accident while “on the job”. 

Rideshare car insurance is based on the phase you’re in — waiting, on the way to a pick up or with passengers or food delivery in-hand. You can add additional coverage to your existing vehicle insurance policy for some or all the phases, or purchase hybrid insurance, which will cover you whether you’re at work or driving around for leisure purposes.