I haven’t talked much about Lyft and Uber’s insurance policy since I did my mega-podcast a couple months ago but it seems like this topic is once again on the minds of many drivers out there (If you haven’t listened to that one yet, I definitely recommend that you do so since almost all of what I talked about still applies). The one thing that has changed since then though is that Lyft and Uber now offer primary insurance during a trip – sort of.
Related Podcast: Uber and Lyft’s Insurance Policy Explained
The reason why I say sort of is because their liability insurance is primary but their collision coverage is still in excess. So that means if you get into an accident, you will be covered by Lyft/Uber for liability up to 1 million dollars but you have to make a claim with your personal insurance before Lyft and Uber’s collision coverage will kick in. Most, if not all insurance carriers will deny your claim if you were engaged in rideshare activities and then Lyft and Uber’s collision insurance would kick in.
The problem with this scenario though is that at this point, in addition to denying your claim, some insurers will also drop you from their policy because they don’t want to insure rideshare drivers. Insurance companies are all about reducing risk, so even though a rideshare driver doesn’t technically pose more risk (carriers can deny the claim and Uber/Lyft will cover everything) to them, since they don’t quite understand the risk yet, they’d rather drop you and not worry about it. There are insurance companies that will cover you (State Farm, Liberty Mutual, to name a couple) but a majority still don’t want to take the ‘risk’. [Read more…]