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Here is the complete 411 on Lyft drivers insurance. Driving for ridesharing platforms doesn’t make you immune from accidents. Sadly, a 2018 survey revealed that almost half of all ridesharing drivers, like those driving for Lyft, do not have rideshare insurance. And while Lyft provides liability coverage, this is only temporary. You may also have your personal policy, but if it doesn’t include ridesharing coverage, then you are essentially exposed to liabilities. Don’t let your insufficient knowledge about Lyft insurance put you at a disadvantage should you meet an accident while driving for Lyft or any other ridesharing service. You don’t want to get stuck with paying for all the auto body work and pain and suffering damages yourself.
Insurance companies typically identify three periods of ridesharing wherein an accident can be covered by insurance.
1. The initial period starts the moment you open your Lyft app but have not yet matched with a rider. You are simply driving around waiting for a rider to match with you.
2. The second period starts right after being matched with a rider and you are already on your way to pick them up.
3. The third period commences the moment the rider steps into your car and ends the moment he or she steps out of your vehicle. Then you go to the first period all over again.
Your understanding of these 3 periods in ridesharing will help you get a better understanding of what Lyft insurance can cover.
If you do get into an accident make sure you retain an experienced accident attorney like Aronberg & Aronberg to best protect your interests.
Typically, your personal auto insurance policy will NOT cover you or your vehicle for damages sustained in an accident while you are using your vehicle for commercial services i.e. driving for Lyft. Instead, the Lyft insurance will be available to you. The amount of insurance coverage available is largely dependent upon whether you have a rider in your vehicle.
In the first period of ridesharing, Lyft will typically cover $50,000 for bodily injuries sustained to anyone injured due to your negligence while driving. Lyft also covers $25,000 for property damage you cause other people. Considering the average cost of newer vehicles and medical treatment, the coverage is relatively low. You may choose to protect yourself by purchasing your own commercial insurance policy.
It is also important to note that Lyft doesn’t cover your own vehicle for damages sustained during this period (the $25,000 coverage is only applicable to damages sustained by 3rd parties). As such, it is imperative that you find a commercial insurance policy if you wish to be covered by insurance. If your insurance company learns your Lyft App was on at the time of the accident, they likely will deny coverage.
If the accident occurred in either Period 2 or Period 3 of ridesharing, Lyft can provide $1 million in liability coverage. For most individuals, this should be sufficient.
As for collision and comprehensive, Lyft also provides coverage for its drivers. However, it is on a contingent basis. So long as you show that you purchased personal collision and comprehensive insurance on your personal insurance policy, Lyft will provide you benefits to protect your vehicle. Sadly, the Lyft deductible is $2,500.
Now, several car insurance companies are offering rideshare-friendly policies which are similar to amendments or rideshare endorsement to be connected to your personal car insurance policy. The sad thing about rideshare endorsements is that they’re only available in a handful of states. Additionally, the type of coverage greatly varies from insurer to insurer and from state to state. Some may cover only Period 1 of ridesharing while others will cover the entire ridesharing experience. Since rideshare endorsement is more like a rider on an existing insurance policy, you can expect your premiums to go up as well. You can always expect an increase in your premiums by 5 to 10 percent.
For now, having a rideshare endorsement is simply the more practical and most convenient way to go if you want to be fully covered while driving for Lyft.
Liability insurance covers injuries sustained to third-parties as a result of your wrongdoing.
Collision insurance covers damages sustained to your vehicle as a result of a collision.
Comprehensive insurance covers damages sustained to your vehicle caused by accidents not involving other vehicles such as falling trees, flooding, fire, etc.
Uninsured Motorist covers injuries sustained by you or your passengers in the event the at-fault party’s insurance is insufficient to cover the full extent of your injuries.
Lyft may provide coverage for certain aspects of the ridesharing experience. However, this is often not enough especially if you don’t have rideshare endorsement. Reviewing your personal car insurance policy and making sure there are no gaps should be one of your top priorities. If gaps are identified, then you can start looking for better solutions. If rideshare endorsement is not provided in your state, you may really have to start considering a commercial policy.
If you/ been in an accident, contact Aronberg & Aronberg today!
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