The growing popularity of ride-sharing companies like Uber™ and Lyft™ has increased the demand for drivers across the nation. In turn, this has generated the need for a new type of auto insurance coverage. Personal policies aren’t designed to provide motorists protection for accidents that occur while they’re driving for a transportation network company (TNC). As such, ride-share drivers are left vulnerable to a gap in coverage. Here’s a basic overview of why you need additional insurance if you drive for a TNC.

The Importance of Auto Insurance for Your Ride-Share Activities 

What the Three Stages of Ride-Sharing Are

Three different stages of ride-sharing are recognized in relation to auto insurance. The first is when the app is turned on and a driver is waiting to accept a fare. The second begins once the driver agrees to pick up a passenger and remains in effect while they are en route to their location. The third starts when the passenger enters the car. The distinctions between each stage matter because coverage typically changes from one to the next.

How Ride-Sharing Coverage Will Help You

TNCs generally provide drivers with a certain amount of auto insurance coverage only while they’re in stages two and three. This means from the minute the app is turned on until a fare request has been accepted, drivers aren’t protected. Though this is often a short window, accidents can happen in a matter of seconds. Adding a ride-sharing gap endorsement will offer drivers similar liability and collision coverage options as included in a personal policy. Some policies will also extend coverage limits for stages two and three, resulting in better protection. 

If you’ve been driving for Uber or Lyft or you’re thinking about starting, you need to check that you’re properly insured. Not many companies offer the protection ride-share drivers need to fill in their coverage gaps, but fortunately, Daniel Oliver Insurance Agency does. Having served as a Farmers® Insurance agent for more than three decades, he knows how to put together a comprehensive auto insurance policy to suit your needs. Count on him to thoroughly evaluate your unique risks and help you fill any voids that exist in your insurance. Call his Edina, MN, office at (952) 925-4454 to request a quote or visit him online for more information on the different products he provides.