What Is Rideshare Car Insurance?
Rideshare car insurance bridges the gap between a driver’s personal car insurance and the limited liability coverage provided by rideshare companies. Typically, rideshare car insurance comes as an add-on or endorsement to a personal policy, covering “Period 1” (when the app is on but there’s no passenger yet) where rideshare companies offer limited coverage. Additional coverage becomes critical in Period 1, as drivers may have no protection otherwise if they’re involved in an accident.
Why Regular Car Insurance Isn’t Enough
Personal auto insurance policies do not cover vehicles used for business purposes like rideshare driving. If a driver is in an accident while logged into a rideshare app, their insurer may deny coverage or even cancel the policy if the rideshare activity wasn’t disclosed. Additionally, rideshare companies offer only limited coverage for certain stages of the ride, making additional rideshare insurance essential to protect against financial risk.
Types of Rideshare Insurance Coverage
Rideshare insurance coverage often varies depending on which phase of driving you’re in. Here’s a breakdown:
- Period 1: App on, waiting for a ride request.
- Coverage Needs: Limited liability (usually minimal, from the rideshare company).
- Potential Gap: Personal policy exclusions, leading to uncovered liability or vehicle damage.
- Period 2: Ride accepted, on the way to pick up.
- Coverage Needs: Higher liability coverage, as well as collision/comprehensive in some cases.
- Company Coverage: Generally, more comprehensive liability from the rideshare provider.
- Period 3: Passenger in vehicle.
- Coverage Needs: Full coverage including liability, collision, comprehensive, and uninsured/underinsured motorist coverage.
- Company Coverage: Maximum liability coverage provided, though deductibles can be high.
Average Costs of Rideshare Insurance
The cost to add rideshare coverage varies by insurer, location, and individual risk factors. On average, drivers can expect to pay an additional $15 to $40 monthly for a rideshare endorsement. Here’s a quick comparison of average costs from top insurers:
Insurance Company | Average Monthly Base Premium | Rideshare Endorsement Cost | Total Monthly Cost |
State Farm | $85 | $23 | $108 |
USAA | $91 | $23 | $114 |
Geico | $97 | $24 | $121 |
Mercury | $101 | $27 | $128 |
Safeco | $103 | $19 | $122 |
For full-year coverage, adding rideshare insurance typically increases annual premiums by $400–$500, which can be a worthwhile investment for drivers seeking comprehensive protection.
Comparison Table: Rideshare Car Insurance Providers
Here’s a look at key coverage options, premiums, and discounts for rideshare insurance:
Provider | Coverage Types | Monthly Premium Estimate | Deductible | Rideshare Discount |
GEICO | Liability, Collision, Comp. | $30 – $80 | $500 – $1,000 | Yes |
State Farm | Add-on (Liability + Comp.) | $25 – $70 | Varies | Yes |
Progressive | Hybrid Personal & Rideshare | $35 – $90 | $250 – $1,000 | Yes |
Allstate | Full Rideshare Add-on | $28 – $85 | Varies | Yes |
USAA | Liability + Comp./Collision | $25 – $75 | $500 – $1,000 | Yes |
Factors Affecting Rideshare Insurance Costs
Several factors influence rideshare insurance premiums, including:
- Location: Urban areas with higher traffic density tend to see higher premiums.
- Driving Record: A clean driving record can lead to lower premiums.
- Vehicle Type: Luxury and newer vehicles generally have higher insurance costs.
- Coverage Limits and Deductibles: Higher coverage limits and lower deductibles result in higher premiums.
Drivers can reduce their costs by opting for higher deductibles or choosing safe, standard vehicles that cost less to insure.
Tips to Save on Rideshare Insurance
- Maintain a Clean Record: Insurers offer discounts to drivers with no accidents or violations.
- Increase Deductibles: A higher deductible means lower monthly premiums.
- Shop Around: Rates vary between insurers, so comparing quotes from multiple providers can help secure the best deal.
- Ask About Discounts: Many insurers offer discounts for multi-policy holders, safe driving, and more.
- Drive a Safer Vehicle: Insurance costs are lower for vehicles with high safety ratings and anti-theft features.
How Much Does Rideshare Car Insurance Cost?
Car insurance for rideshare drivers costs vary widely depending on the driver’s location, driving history, and coverage level. Typically, a rideshare insurance add-on costs an additional $20 to $100 per month on top of a regular premium. While this may seem like an extra expense, the additional coverage helps to avoid substantial out-of-pocket costs in case of an accident.
How to Choose the Best Rideshare Car Insurance
To find the best rideshare car insurance for your needs, consider the following:
- Coverage Gaps: Identify potential gaps in your personal policy and look for rideshare insurance that addresses these.
- Deductible Options: Choose a deductible you’re comfortable with; some rideshare companies require high deductibles, so look for a policy that aligns.
- Flexibility: Some insurers offer hybrid policies that cover personal and rideshare use. This can be a convenient and cost-effective option.
- Discounts and Bundling: Many providers offer discounts for bundling with other insurance products.
Rideshare Insurance FAQs
Yes, even occasional drivers should consider rideshare insurance. Without it, your personal auto policy may be voided if you drive for a rideshare company, which could lead to denied claims.
Rideshare insurance typically adds $15–$40 to a monthly premium, depending on factors like location, vehicle type, and driving record.
Rideshare insurance is available in most states, though availability varies by insurer. Some states, like New York, may have limited options.
Deductible gap coverage is an optional feature that covers the difference if your rideshare company’s deductible is higher than your personal policy’s deductible.
Uber and Lyft provide some coverage, but it doesn’t cover all scenarios or periods. Rideshare insurance is recommended to fill these gaps and ensure full coverage.
About The Author
Andy Walker is a freelance content writer who specializes in writing for insurance and finance related niches. He has years of experience in this field and has written extensively on a variety of topics. Andy’s work is always highly polished and well-researched, ensuring that his clients are always happy with the results.