Rideshare drivers may need additional insurance coverage

Houston - Many people use their vehicles for ride-share work. But are you covered in an accident?

Accidents can be financially devastating if there are injuries and damage to vehicles or property.

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"It was pretty scary, a lot of sleepless nights over this," said Isis Moreno.

Sleepless nights for Isis Moreno, who says her son was in an accident while driving for a ride share company. She says at first, his insurance carrier denied the claim.

"He got a letter saying we’re not going to cover your car. It was terrifying for him," said Moreno.

But once they pointed out he had purchased additional ride share coverage, she says the insurer changed its tune.

"They are going to go ahead and pay his claim. However, I just want people to know in today’s world of drivers and Lyft drivers, and groceries and deliveries, there’s a certain kind of insurance you should have," said Moreno.

Many ride share companies, including Uber, Lyft, and Door Dash, require drivers to meet the minium state auto insurance requirements. These companies usually also provide third-party liability coverage while their app is on, from when the driver accepts a booking to delivering the passenger or product.  

"Typically they will offer some sort of insurance while you’re actually driving, when you hit the accept or start driving," explained Richard Johnson with the Insurance Council of Texas.  

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But experts warn there may be a deductible that drivers have to pay, and that personal auto insurance may not cover drivers while that app is on. Texas requires ride share drivers to have additional insurance, often called ride share insurance, costing anywhere from an additional $2 to $115 a month.

"It is a cost that’s going to eat into your bottom line. But it’s also peace of mind and that financial security of having it should something happen," said Johnson.

And if you drive your personal vehicle for other types of businesses, such as making sales calls or picking up office supplies, you should ask your employer if they have commercial insurance to cover you. You should also inform your personal auto insurer if you drive frequently for work or frequently drive a carpool. If insurance carriers are not informed, they could deny the claim, raise your rates, or drop you from coverage.

We asked Uber, Lyft, and DoorDash for their policies on insurance coverage.

Uber sent us this statement:

• Uber maintains commercial auto liability insurance coverage on behalf of drivers while operating on the Uber app, including $1M of liability insurance once a ride is accepted. This insurance applies regardless of whether a driver’s own personal auto insurance covers ridesharing activity.
• We partner with leading insurance companies to offer a range of solutions, including on-app coverage for accidents and injuries on the platform.You can read more about insurance here.
• You can read more about insurance here.
• In addition, drivers in Texas are able to opt-in to Optional Injury Protection insurance. This insurance provides first-party injury protection, including medical expenses, disability and survivorship benefits.Learn more about Optional Injury Protection here.
• Learn more about Optional Injury Protection here.

Lyft responded:  

"Lyft is the primary insurance provider from the time the app is turned on and maintains insurance in compliance with local and state regulations. Lyft’s $1M auto liability policy provides coverage for bodily injury to passenger(s), and/or third parties, and for property damage from the time a driver is matched with a passenger up until the passenger exits the vehicle. For more information visit: https://help.lyft.com/hc/en-us/articles/115013080548

• Drivers are required to have auto insurance that meets minimum state coverage requirements.
• Keep in mind that most personal auto policies will not cover you while you’re driving with Lyft.
• For complete coverage whenever you drive, consider buying a rideshare insurance policy or a rideshare endorsement.

A detailed overview of our insurance coverage can be found here."

And DoorDash sent us the following:

• We were the first national delivery platform to offer occupational accident insurance to Dashers at no cost to them, and with no opt-in or application required, which can support them if they’re injured while providing a delivery on our platform. To learn more about our occupational accident policies, please check out this page.

• DoorDash requires all Dashers to maintain an up-to-date auto insurance policy. You can learn more about our auto insurance policies here.
o During the Dasher signup process, if a car is selected as a Dasher’s vehicle type, they are asked to provide vehicle details and agree to our insurance requirements.
• DoorDash offers excess liability insurance, which applies to accidents that occur while Dashers are on an active delivery. This is a secondary form of insurance and does not replace the up-to-date auto insurance policy that every Dasher is required to maintain.