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What Drivers Need To Know About Uber Insurance

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Gigly team, Marketing at Gigly
Insurance for Uber drivers

If you’re in an accident on the job, you don’t want to be surprised about insurance coverage.

Uber insurance is a tricky topic, but you won’t be caught off guard after reading this guide.

We’ll show you all the nuances, answer your pricing questions, and address other details Uber drivers should know before taking their next job.

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Your Requirements As An Uber Driver

Considering driving for Uber but haven’t started yet?

Insurance is only one of the essential requirements.

The minimum specifications you’ll need to be a driver will depend on if you’re planning on delivering food for Uber Eats (delivery driver) or people for Uber itself (rideshare driver).

So what does it take to join Uber?

Here are the requirements for each position.

Delivery Drivers

In the United States, delivery driver candidates must submit their Social Security number on their application. Uber uses that number to do a background screening on your criminal and driving records.

To deliver using a car, you must be at least 19 years old with a valid driver’s license and a good driving record.

They’re not too picky about your car, as long as it’s a two-door or four-door, and you have an insurance policy (more on that later).

You can still deliver if you don’t meet the age and driver’s license requirements. Just pick “delivery by scooter, foot, or bicycle” under the transportation method on your application. You’re eligible for these transportation modes if you’re 18 or older and have a valid government-issued ID.

Rideshare Drivers And Personal Expectations

Driving for a rideshare company, whether it’s Uber, Lyft, or any other brand, is a high level of responsibility. You’re in charge of safely delivering people to their destinations, and you’re connected to the company’s name.

It’s only natural that whomever you’re working for wants to ensure you’re going to keep their reputation positive. Your background check and vehicle specifications as a rideshare driver are stricter.

Uber drivers must have at least one year of licensed driving in the United States. The only exception to this rule is if you’re under 25, in which case you need at least three years of licensed driving experience.

Each city has a minimum age rule, but everyone who drives for Uber must hold a valid, clean driver’s license (less than three major violations).

The background check searches for a history of:

  • Violent crimes
  • Sexual offenses
  • Felonies (including pending charges)

Your record doesn’t have to be spotless, but it does have to be free of these issues.

Vehicle Expectations For Rideshare Drivers

Finally, since you’ll be driving people around town in your personal car, it has to have a valid license plate for the state in which you’re driving. You’ll need at least four doors and four seat belts.

Vehicles can’t be older than 10 to 15 years and must pass a safety inspection.

If all of that sounds like a green light for you, it’s time to delve into the insurance aspect of your future career.

Read more: How To Work For Uber (And Car Requirements)


What You Get With Uber Insurance

Uber insurance features
Any time you’re using your car for work-related purposes, insurance becomes a crucial issue.

The lines between your personal coverage and rideshare insurance can be a little blurry. You should understand what you’re covered for, and where there are gaps in your policies.

Yes, Uber does provide its drivers with a basic liability insurance policy. But this coverage is more for Uber’s protection than yours.

How Uber Insurance Works

When driving for Uber Eats or Uber’s rideshare service, you’re automatically covered under a free, third-party insurance contract with their insurance provider (currently Portier LLC).

This type of coverage is for liability purposes only. You must be actively engaged in a delivery, with either people or food, and logged into the Uber app.

If you are, your accident is covered with these terms:

  • $1 million of liability (per incident)
  • An additional $50,000 in third-party bodily injury coverage limits per individual (up to $100,000) for between-trip accidents if your insurance does not cover it
  • $25,000 in property damage liability for in-between accidents that aren’t covered by your insurance

These numbers are generalized rideshare insurance policy limits.

Per Uber’s website: “Uninsured/underinsured motorist bodily injury coverage and first-party injury coverage limits vary by state.”

The insurance Uber provides sounds solid, right?

If it was as easy as “you get in an accident, Uber covers the damage,” that would be ideal.

Unfortunately, the reality is more ambiguous, but we’ll clarify it here.

Are You Covered By Uber? It Depends On The Driving Period

Drivers for Uber delivery and rideshare are always in one of four activity periods, labeled 0 through 3.

Period 0

Period 0 means you’re driving your own car for yourself. You’re not working, and aren’t entitled to any Uber liability coverage help if you’re in an accident. Your own insurance clearly covers you here.

Period 1

In Period 1, you’ve entered the wait zone. Your rideshare app is on, and you’re waiting for a delivery or ride request. Here, your personal insurance should cover you in an accident, but Uber’s coverage might kick in if necessary.

Periods 2 and 3

In Periods 2 and 3, you’re active en route to pick up a delivery or passenger, or they’re in your car. You or your passengers sustained a personal injury, so Uber’s commercial policy is primary.

Now, The Fine Print

If you’re a rideshare driver, the fine print could be important, meaning the difference between minimal and substantial personal liability.

When riders request and accept a ride, they sign a document that absolves Uber of responsibility in an accident.

So who becomes liable?

You do, if the accident is your fault.

When you’re driving for work, you assume Uber is responsible for collision coverage. Even if this is true, you’re still on the hook for any rideshare insurance coverage deductibles (usually $1,000 or $2,500, depending on the accident and vehicle involved).

If you get cited as the at-fault cause of the accident, Uber can step out. Since you’re an independent contractor, they’re not liable for your actions. Unless the victim’s attorney can prove that Uber was negligent in hiring or training you, your insurance becomes primary.

It’s a legal battle in which you don’t want to have to worry about coverage gaps when you’re involved.

Check the fine print. Uber’s policy is nice, but it is not something you should rely on to protect yourself.

One more caveat in the fine print to note: drivers in an accident in New York State are excluded from Uber’s coverage. If that’s you, it’s even more urgent that you check your personal car insurance rates and fill in any gaps in liability limits.


Additional Coverage You Should Have

Did you know that your personal vehicle insurance will probably not cover you if you’re in a work-related accident?

Because of the popularity of rideshare and delivery driving jobs, most auto insurance companies have added an exclusion for accidents in the line of business. Uber and Lyft drivers, in particular, are often listed as non-covered entities.

To be safe, check with your insurance carrier to see if you can get work-related coverage as an add-on to your current personal auto insurance policy. You may have to look elsewhere if your current company doesn’t offer rideshare or similar insurance.

Commercial Versus Business Auto Insurance

You’ll see these two terms crop up as you explore your coverage options. They sound the same, yet they have a few distinct differences. These little nuances gear the policies toward specific industries.

Commercial Auto Coverage

Commercial auto insurance provides coverage to businesses that use vehicles as part of their services.

Uber would have to invest in this coverage for you if you were their employee.

For example, pizza shop delivery drivers are employees, not independent contractors. Pizza shop owners have to buy commercial insurance that covers their employees in the event of an on-the-job accident.

Because you are an independent contractor and self-employed, it falls to you to carry a commercial auto policy.

Some companies, such as Allstate and GEICO, offer rideshare insurance. Talk to your agent to see which criteria are legally required in your state.

Business Auto Coverage

Business auto coverage refers to insurance that handles anything related to how you use your own vehicle for incidental work purposes.

As an example, when you’re an IT support person heading to a client’s house to work on their computer, and you’re in an accident, business coverage kicks in.

The distinction between the two is that commercial insurance coverage is necessary when using the vehicle is the primary work description, as is the case for Uber driving. Business coverage only helps when you need your car to get you to your out-of-office jobs.

When you’re selecting your additional coverage, make sure you’re getting rewarded for your purchase. Check out the best credit cards available to freelancers.

Optional Coverage For Uber Drivers

Uber Insurance coverage
You already know your car insurance policy is a vital part of your career. To hold onto your job and protect yourself from liability, you’ll have to keep Uber’s minimum insurance requirements.

Auto coverage isn’t the only asset protection type out there.

Are you taking steps to proactively plan for emergency and unexpected situations?

Uber’s Optional Injury Protection

Since you made the move to being a self-employed business owner, you might have lost the benefits of other corporate insurance policies, like life insurance and disability coverage.

But as an Uber driver, the company has Optional Injury Protection you can sign up for right in the app.

For a low insurance cost of $0.03 per mile driven, you can invest in disability, medical expense, and survivor benefit coverage.

Disability will pay you up to $500 per week to replace your income if you’re unable to work for a while due to an illness or injury.

Should you end up with a serious accident-induced doctor bill, medical expense coverage helps. Uber’s policy provides accident coverage up to a maximum of $1,000,000. As a bonus, there’s no deductible or copay to worry about.

Another important factor to consider is how your family will get along if you’re not there to provide for them. Uber’s survivor benefits package pays a maximum of $150,000 in the event of your death.

If you live in California, you don’t have to pay for Optional Injury Protection. Effective 12/16/20, this coverage is gratis, paid for by Uber.

What About Other Benefits?

Accident expense coverage is great, and the peace of mind that comes with knowing you’ll have an income if you’re out of work due to health problems is priceless.

But, in addition to these important policies, having proactive health protection is beneficial.

Whether you lost your health insurance when you left your corporate job, or if you never had it in the first place, you now have options.

As a self-employed gig worker, you’re entitled to healthcare indemnity benefits and other policies from Gigly’s Insurance Marketplace.

Gigly is a platform designed especially for independent workers and small business owners. Everything you need to build and expand your side job or full-time gig is there.


Conclusion

“Buyer beware” is a frequent warning for shoppers today, but Uber’s insurance policy is free. This makes it easy to overlook the downside of driving for the mega company and assuming their insurance will protect you.

Now that you know the reality behind Uber’s policy and what it actually covers, it’s time to call your agent for an insurance quote. Check with State Farm, USAA, or other well-known names to see if they offer rideshare coverage.

You’ll head out to your next Uber assignment knowing you’re shielded with the best coverage possible.

While you’re shopping for policies, consider signing up for a Gigly individual or family membership. These comprehensive plans give you a variety of wellness benefits, as well as incredible discounts on prescription medication and more.