If you decide to drive for a Transportation Network Company (TNC) like Uber or Lyft…make sure you understand how your personal auto insurance policy and the insurance provided by a TNC interact, because each uses a very specific time frame when / if they will cover your liability, injuries to you and your passengers in your car and damage to your vehicle.
In general think of your personal insurance coverage being triggered by 4 different events.
A. When you are in your car….and DON’T have your app turned on
B. When you are in your car and DO have your app turned on and ready to accept a paying passenger
C. When the paying passenger enters your car
D. When the paying passenger leaves your car
The Lyft Webpage has a very readable graphic view to demonstrate this
The easiest way to remember is that once you turn on the app and are ready to accept a paying driver, most insurance carriers will void any and all insurance coverage you have on your personal auto policy. So from this point you are reliant on the ride sharing insurance policy to cover your liability, injuries and damage to your vehicle. It looks to me like many of these rides hailing companies don’t offer very high liability limits In Period B. This means you could be held liable if you are in an ‘at fault ‘accident during this time and your coverage is not sufficient to the other party you injured.
Technology is a wonderful thing, but insurance carriers are notoriously slow to react and change their policies to meet the needs of it’s customers. We are currently in a transition period and it looks like this type of service is here to stay. Personal lines insurance carriers will most likely find a way to adapt to the new service economy, but at least for now, you may have gaps in your insurance coverage and need to thoroughly educate yourself!
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