Signing up with a ridesharing company is a great way to make some extra cash if there’s demand for the service in your area. But doing so may have some insurance implications you should consider before going full steam ahead with your new income stream.
Ridesharing companies do offer drivers a large insurance policy that will cover them when they have a passenger in the car. And of course, your personal policy will cover you when you’re out running errands or driving around for personal reasons. But there’s a gap in coverage rideshare drivers should be aware of. When rideshare drivers are signed in to their ridesharing app and waiting for a fare, they are not covered by the ridesharing company’s policy. And if an accident occurs during that time, their personal insurance policy may not cover them either -- they might even cancel the policy if you failed to disclose your employment with a ridesharing company.
To make sure you’re covered in that vulnerable time between signing into the ridesharing app and picking up a passenger, consider purchasing special commercial insurance for ridesharing drivers. This insurance is typically cheaper than that a taxi driver must hold, but it ensures you’re consistently covered when behind the wheel of your car.
If you’re considering signing up with a ridesharing company, be sure to contact your insurance company and discuss your options. You don’t want to surprise your insurance company with your newfound employment and you don’t want to be surprised by a lack of coverage.