Uber Insurance Coverage – Are You Insured, Underinsured, or Not At All?
A lot of Uber drivers assumed that they are fully covered by the Uber insurance. Some think they will be covered by their personal car insurance if an accident were to occur. The truth is, the insurance coverage provided by the rideshare company Uber is not what it seems to be. Or at least comes with certain conditions. Not enough information about Uber insurance coverage out there. So that leaves thousands of drivers with no idea what’s going on.
I’m going to try to explain as much as I can and to the best of my knowledge when you are truly covered, and when or if you’re not fully insured with Uber.
The Uber insurance coverage depends on a few factors. In other words, an Uber driver coverage broken up into three parts, let’s referred them to as period 1, period 2, and period 3.
Ok! Let’s start with period 1
: You are driving around waiting to be pinged, but not yet matched with a pax, but your Uber app is obviously on. Guess what? During this period that you are driving around, you are covered with only a contingent liability. What that means, is that if you happen to involve in an accident, you’ll have to go through your personal vehicle insurance first. Obviously, your insurance company will find out that you were doing Uber at the time you were involved in the accident.
So, your personal car insurance will deny your claim, that’s when Uber comes in. But the thing is, during this period, Uber only cover you with a liability insurance which has a limit of $50k/$100k/$25k, just like a minimum PIP required by your state to have on your vehicle. That means you are NOT covered with a comprehensive or collision policy.
So, if you involve in a big accident, this contingent liability provided by Uber won’t be enough. You will be responsible to cover the damage of your car. This also means, even if you are not at fault, and the other person doesn’t have insurance, you’ll also be responsible for your vehicle damage since you don’t have comprehensive/collision during this period 1.
In this period 1, drivers find themselves in a vulnerable position. Uber will only cover the liabilities based on the policy limits. So, drivers will have to repair their vehicle out of pocket. Not only that, drivers won’t be able to Uber until their car is fixed and passed Uber inspection. Since you are ubering, you are involved in a business activity, so your personal car insurance will most likely cancel your policy.
Now, let’s talk about period 2!
Let’s say you have been pinged, and you actually accepted the request. Now you are en route to pick up your rider/passenger/pax, now you are covered with $1 million liability provided by Uber. During this period 2, you as drivers, covered with a contingent collision and comprehensive provided by your rideshare company Uber. So you won’t have to pay damage of your own vehicle out of pocket.
The filing process during this period 2 remains the same as period 1, meaning you have to be denied first by your own car insurance, which can also result in your policy being canceled. But at least during this period, Uber insurance will kick in. There’s a $1000 deductible, which you’d have to pay a grand to Uber. If the damage is under $1000, obviously you won’t get a dime from Uber.
And that bring us to period 3 of Uber insurance.
You actually pick up a rider, and you are headed to his/her destination. Guess what? You are of course covered as well as the pax the entire time until drop off. This period 3 is pretty much identical to period 2, only difference is that you have a passenger in your car.
You have to have personal coverage on your vehicle to be driving for Uber, as their policy is contingent upon you’re having this coverage. Only and only when your claim get denied by your personal car insurance, your rideshare uber insurance will kick in and cover damages/bodily injuries/properties etc…
Like always, if you have any questions, let me know and I’ll do my best to answer you ASAP. Is it worth the risk to drive with Uber without Rideshare insurance? Let me know.