Uber drivers are rewarded with fares and bonuses based on their ratings and the completion of trips. However, many Uber driver-partners do not have commercial auto insurance to protect themselves or their passengers if they’re in a car accident.
According to the company’s estimates, only about 40% of all Uber drivers are commercially insured. But what about the other 60%, Uber drivers? They drive without protection for either themselves or their passengers in case something goes wrong.
If you’re a passenger in an Uber vehicle, you may have to use your personal auto insurance policy if you have one. But should you have a collision with an uninsured driver? What if the accident is your fault and passengers in other vehicles are involved?
Do Uber drivers carry commercial auto insurance?
UberX and Uber Black drivers must carry full commercial insurance to cover their liability for themselves and their passengers if they’re involved in a car accident. They also must pay licensing fees based on the state in which they operate. However, many drivers do not buy this type of insurance or pay these fees because it’s expensive.
Uber Green drivers don’t have to carry commercial auto insurance, but they must have proof of personal car insurance coverage.
Uber drivers are responsible for providing their auto insurance, and rideshare companies aren’t required to provide any coverage for drivers because they’re considered independent contractors.
How can you get Uber commercial insurance?
There are a few different ways for Uber drivers to get commercial auto insurance. The most common way is to buy a personal auto policy that includes commercial liability insurance. Most personal auto policies have liability coverage regardless of where the accident happens.
But these policies don’t cover any other events, such as collisions, injuries or damages that happen while the driver is using their vehicle for business purposes. These policies also don’t cover any incidents that occur while a driver is carrying paying passengers, like Uber trips.
You can buy an umbrella policy to prolong your coverage if needed. Umbrella policies are usually cheaper than buying a significant number of policies individually. You only need to buy one umbrella policy to cover all accidents with any vehicle, such as an Uber or a personal car.
But there is another way drivers can get commercial auto insurance: using a commercial auto broker. These insurance agents specialize in providing commercial coverage for the vehicles they represent. They can provide the terms and conditions of coverage, and they will help you purchase this mandatory group coverage from an insurance company on your behalf.
Not every broker offers this type of service, so be sure to contact your current broker and ask if they have any experience working with Uber drivers or for other ride share companies.
Uber insurance covers passengers, too.
While Uber drivers and their passengers are covered by their auto policies, Uber does provide some coverage for both. Passengers have the same liability coverage that Uber drivers have, regardless of whether the incident occurs in an Uber vehicle or not. And passengers’ medical bills are also covered as long as they don’t incur more than the stated worth of expenses from the accident.
The Uber insurance policy doesn’t cover accidents with other vehicles. Still, if you’re involved in a car accident with an uninsured driver or someone driving an unknown vehicle, and you filed a claim on your insurance policy afterwards, then your coverage will be held harmless. No additional penalties will be assessed for you.
However, insurance companies will not pay for any claims related to all types of criminal activities, including carjacking or assault.
What if I’m an Uber driver with no commercial auto insurance?
If you’re an Uber driver and don’t have commercial auto insurance, your passenger’s claims may still be covered by their coverage. But there are some exceptions: if your passenger can prove that you knew about the lack of coverage before entering your vehicle, they can file a lawsuit for damages against both you and Uber.
If the passenger is injured and you’ve been found to have violated insurance laws, you could be fined or even have your driver’s license suspended.
Should You Get Commercial Auto Insurance for Uber?
If you plan on driving for Uber long-term, it’s probably best to purchase commercial coverage from the start. If you continue to drive for Uber long-term and don’t purchase this type of insurance, any injuries or damages that occur while on a ride will be covered by your protection.
Without commercial insurance, you’re responsible for paying for all costs and damages due to an accident if you drive for Uber, but don’t buy commercial coverage. It can be a huge financial burden on top of driving costs you already incur.
Advantages of having Uber Insurance for passengers
Group policies are a benefit for Uber drivers and passengers as well. When Uber drivers buy commercial group insurance, they can get better rates on their coverage. It is because the premiums depend on the number of drivers covered by the policy.
It means that you might get a great discount on your auto insurance if your driver covers you with commercial insurance. It can help both you and your driver because it will reduce their costs of owning or operating their vehicle and get it back on the road sooner to generate more fares.
Disadvantages of having Uber Insurance for passengers
Although there are some great benefits to being an Uber passenger, being covered with commercial auto insurance can be disadvantageous. If your driver has this coverage and you’re in a serious accident, you might not be eligible for reimbursement. Suppose the driver has a personal auto policy with commercial coverage, but they are only driving for a rideshare company part-time. In that case, your auto policy might not reimburse you either if it’s found that the driver was operating his vehicle for business purposes without proper insurance.
Not all insurance companies offer commercial coverage, and they might charge more in the event of an accident. Suppose you’re not willing to pay a significant premium for your group policy. You might want to consider purchasing only basic personal coverage and upgrading your policy to a more affordable option later on.
This way, you can get both the benefits of commercial coverage and the advantages of having a cheaper policy. It is an option that’s worth considering if you see that commercial auto insurance has lower rates than what you’re using now or if the cost of your expense-based coverage with personal use is higher than it’s worth.
Conclusion
Driving for Uber is a great way to make money, but you should consider the insurance benefits of driving for this ridesharing company. If you’re an Uber driver and don’t have commercial insurance, you could be held liable if someone is injured due to your ride.
If you plan to continue to drive for Uber long-term, it’s best to consider buying commercial coverage from the start. This way, your passengers will have maximum insurance protection, and they’ll be able to make claims without being penalized in any way. Both the driver and passengers will benefit.
Uber drivers are rewarded with fares and bonuses based on their ratings and the completion of trips. However, many Uber driver-partners do not have commercial auto insurance to protect themselves or their passengers if they’re in a car accident.
According to the company’s estimates, only about 40% of all Uber drivers are commercially insured. But what about the other 60%, Uber drivers? They drive without protection for either themselves or their passengers in case something goes wrong.
If you’re a passenger in an Uber vehicle, you may have to use your personal auto insurance policy if you have one. But should you have a collision with an uninsured driver? What if the accident is your fault and passengers in other vehicles are involved?
Do Uber drivers carry commercial auto insurance?
UberX and Uber Black drivers must carry full commercial insurance to cover their liability for themselves and their passengers if they’re involved in a car accident. They also must pay licensing fees based on the state in which they operate. However, many drivers do not buy this type of insurance or pay these fees because it’s expensive.
Uber Green drivers don’t have to carry commercial auto insurance, but they must have proof of personal car insurance coverage.
Uber drivers are responsible for providing their auto insurance, and rideshare companies aren’t required to provide any coverage for drivers because they’re considered independent contractors.
How can you get Uber commercial insurance?
There are a few different ways for Uber drivers to get commercial auto insurance. The most common way is to buy a personal auto policy that includes commercial liability insurance. Most personal auto policies have liability coverage regardless of where the accident happens.
But these policies don’t cover any other events, such as collisions, injuries or damages that happen while the driver is using their vehicle for business purposes. These policies also don’t cover any incidents that occur while a driver is carrying paying passengers, like Uber trips.
You can buy an umbrella policy to prolong your coverage if needed. Umbrella policies are usually cheaper than buying a significant number of policies individually. You only need to buy one umbrella policy to cover all accidents with any vehicle, such as an Uber or a personal car.
But there is another way drivers can get commercial auto insurance: using a commercial auto broker. These insurance agents specialize in providing commercial coverage for the vehicles they represent. They can provide the terms and conditions of coverage, and they will help you purchase this mandatory group coverage from an insurance company on your behalf.
Not every broker offers this type of service, so be sure to contact your current broker and ask if they have any experience working with Uber drivers or for other ride share companies.
Uber insurance covers passengers, too.
While Uber drivers and their passengers are covered by their auto policies, Uber does provide some coverage for both. Passengers have the same liability coverage that Uber drivers have, regardless of whether the incident occurs in an Uber vehicle or not. And passengers’ medical bills are also covered as long as they don’t incur more than the stated worth of expenses from the accident.
The Uber insurance policy doesn’t cover accidents with other vehicles. Still, if you’re involved in a car accident with an uninsured driver or someone driving an unknown vehicle, and you filed a claim on your insurance policy afterwards, then your coverage will be held harmless. No additional penalties will be assessed for you.
However, insurance companies will not pay for any claims related to all types of criminal activities, including carjacking or assault.
What if I’m an Uber driver with no commercial auto insurance?
If you’re an Uber driver and don’t have commercial auto insurance, your passenger’s claims may still be covered by their coverage. But there are some exceptions: if your passenger can prove that you knew about the lack of coverage before entering your vehicle, they can file a lawsuit for damages against both you and Uber.
If the passenger is injured and you’ve been found to have violated insurance laws, you could be fined or even have your driver’s license suspended.
Should You Get Commercial Auto Insurance for Uber?
If you plan on driving for Uber long-term, it’s probably best to purchase commercial coverage from the start. If you continue to drive for Uber long-term and don’t purchase this type of insurance, any injuries or damages that occur while on a ride will be covered by your protection.
Without commercial insurance, you’re responsible for paying for all costs and damages due to an accident if you drive for Uber, but don’t buy commercial coverage. It can be a huge financial burden on top of driving costs you already incur.
Advantages of having Uber Insurance for passengers
Group policies are a benefit for Uber drivers and passengers as well. When Uber drivers buy commercial group insurance, they can get better rates on their coverage. It is because the premiums depend on the number of drivers covered by the policy.
It means that you might get a great discount on your auto insurance if your driver covers you with commercial insurance. It can help both you and your driver because it will reduce their costs of owning or operating their vehicle and get it back on the road sooner to generate more fares.
Disadvantages of having Uber Insurance for passengers
Although there are some great benefits to being an Uber passenger, being covered with commercial auto insurance can be disadvantageous. If your driver has this coverage and you’re in a serious accident, you might not be eligible for reimbursement. Suppose the driver has a personal auto policy with commercial coverage, but they are only driving for a rideshare company part-time. In that case, your auto policy might not reimburse you either if it’s found that the driver was operating his vehicle for business purposes without proper insurance.
Not all insurance companies offer commercial coverage, and they might charge more in the event of an accident. Suppose you’re not willing to pay a significant premium for your group policy. You might want to consider purchasing only basic personal coverage and upgrading your policy to a more affordable option later on.
This way, you can get both the benefits of commercial coverage and the advantages of having a cheaper policy. It is an option that’s worth considering if you see that commercial auto insurance has lower rates than what you’re using now or if the cost of your expense-based coverage with personal use is higher than it’s worth.
Conclusion
Driving for Uber is a great way to make money, but you should consider the insurance benefits of driving for this ridesharing company. If you’re an Uber driver and don’t have commercial insurance, you could be held liable if someone is injured due to your ride.
If you plan to continue to drive for Uber long-term, it’s best to consider buying commercial coverage from the start. This way, your passengers will have maximum insurance protection, and they’ll be able to make claims without being penalized in any way. Both the driver and passengers will benefit.
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