With ride sharing becoming more popular recently with companies like Lyft and Uber, people are looking to make extra income by taking to the roads on nights and weekends to pick up passengers for extra cash.  Unfortunately, an important thing to consider in your new side business is how it can impact your car insurance.  Make sure you find out the answer to these things before you start driving.

When Does The Ride Share Company Start Offering Insurance Coverage?

There are four different phases where your insurance coverage changes when driving for a ride share company.

1. When driving in your car before logging into the service and after logging out.
2. When logged into the service and waiting to accept a ride.
3. When on your way to pick up a passenger for a ride you have accepted.
4. When driving the passenger to their destination

While ride share companies do provide insurance, the insurance changes depending on what phase you are in.  Always make sure you know when your provided coverage begins and ends, because you do not want to be shocked to find you didn't have coverage when you thought you did.

How Much Coverage Do You Have In Each Driving Phase?

In addition to having different phases that you drive in, every ride share company will offer different amounts of coverage for each phase.  It may not be the same across all phases and changes with each company.

For example, while Uber drivers can receive $1,000,000 in liability coverage while on the way to pick up a passenger or driving a passenger to a destination, the coverage drastically changes while you are waiting to accept a job.  They only offer coverage beyond your personal insurance that will pay for:

• Up to $50,000 per individual for bodily injury coverage
• A max of $100,000 in bodily injury coverage per accident
• A total of $25,000 in property damage per accident

Do You Need Additional Insurance?

Insurance is a way to minimize risk in a worst-case scenario. As you can imagine, the coverage offered by a ride sharing company while waiting to accept a job is not much.  You can easily go over your bodily injury coverage in an accident involving 3 or more people in the other car. 

You should contact your local auto insurance agent and find out what kind of additional coverage you need to ensure that you are protected in a worst-case scenario.  You'll be driving on the road a lot more, so the chance of getting into an accident increases with it.