Rachael Brennan has been working in the insurance industry since 2006 when she began working as a licensed insurance representative for 21st Century Insurance, during which time she earned her Property and Casualty license in all 50 states. After several years she expanded her insurance expertise, earning her license in Health and AD&D insurance as well. She has worked for small health in...

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Jeffrey Johnson is a legal writer with a focus on personal injury. He has worked on personal injury and sovereign immunity litigation in addition to experience in family, estate, and criminal law. He earned a J.D. from the University of Baltimore and has worked in legal offices and non-profits in Maryland, Texas, and North Carolina. He has also earned an MFA in screenwriting from Chapman Univer...

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Reviewed by Jeffrey Johnson
Insurance Lawyer Jeffrey Johnson

UPDATED: Apr 14, 2022

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In a nutshell...

  • If you are a ride-share partner, you should always review your insurance policy to spot vulnerabilities
  • When the ride-sharing concept was first created, personal car insurance policies provided no coverage
  • While you are required to have your own insurance to become an Uber partner, Uber does provide some coverage
  • If you’re online waiting for a request or you have a rider in your car, you’ll be protected by a commercial policy
  • If you’re not online or driving a rider, you need to check your policy provisions to see if you have some cover

Ride-sharing has changed the way that students and business professionals alike get from point A to point B. Advances in mobile technology have made it possible for people in need of transportation to press a button and request a ride.

It’s not just a convenient option for the rider, it’s a great way for the driver to earn extra money on their own schedule.

If you’re going to create your own schedule through Uber, one of the largest ride-sharing companies in the country, you should do some planning first.

Not only is it important to keep track of your expenses for tax purposes, it’s just as important to keep track of your car insurance coverage.

While your personal car insurance policy does provide some cover, there are certain restrictions. Enter your zip code into our free rate comparison tool above to find the best car insurance for your situation.

Personal Auto Insurance Exclusions


If a personal auto insurance policy didn’t contain exclusions, the insurer providing the coverage would be on the line for paying for every claim that you present against your policy.

Auto insurance is a contract and all legal contracts need to be thorough. There’s an entire section in your contract that spells out what isn’t covered. This section is called the exclusions category.

If you want to see what specifically your contract excludes, you should refer to your policy booklet.

You can’t find information on coverage definitions or exclusions by looking at your auto insurance ID cards or your declarations page but you can find this information in the thick booklet that comes with your policy when you activate coverage.

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Many Forms of Business Use are Excluded From Personal Insurance

Most insurance companies have policies that take into account that you will be driving your personal car for more than just personal use.

After all, you need access to your car to get back and forth from work. You’re not restricted to using your car for strictly personal use but there are still restrictions.

You can commute to and from the office in your vehicle and you can even drive property buyers around town as a real estate agent, but there are forms of business use that are excluded word for word in the contract.

The business use that’s almost always excluded is commercial activity.

What is ride-sharing classified as?

It can be difficult to learn the insurance lingo that is used by agents when you’re not well-versed in insurance.

The conventional contract that was constructed by insurance company legal departments never specifically said anything about ride-sharing and how it was classified under personal insurance because ride-sharing has only recently come about.

If you read the words that are used in the contract, fulfilling a request as a ride-sharing partner is classified as an excluded commercial activity.

While you are technically considered an independent contractor participating in a peer-to-peer network, the exclusion was written into your personal contract still applies in these for hire situations.

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What is the public livery exclusion?

Policy language has been modified and updated for the last few years to address the new issues that have been arising when claims are made against personal insurance for an accident that occurred while a driver was on duty.

Now, most policies include an exclusion for claims that arise while the driver is carrying persons for a charge.

Some peer-to-peer networks that operate unique forms of ride-sharing services have argued that some form of payment is allowed as long as the payment that the driver is accepting is to reimburse the driver for expenses incurred.

This reimbursement would mean that someone is only driving someone in exchange for money for fuel, tolls, etc. You will have to speak with your agent to discuss what the public livery exclusions mean to the carrier.

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Business Use in Your Personal Car Must be Incidental


You don’t automatically need a Business Auto Policy on the car that you keep parked in your own driveway at night if you’re driving it for some business use.

As long as the business use meets the definition of incidental to your business, you can hold onto your Personal Auto Policy.

If you’re delivering goods or transporting people in your car and don’t have any other coverage, you have a need for a commercial auto policy.

Some Companies Offer the Option for Endorsements

Your insurer might exclude commercial use but the creation of ride-hailing services has created the need for new personal auto policy endorsements.

These endorsements are a great option for Uber drivers who want to make an extra buck without having to pay for a Business Auto Policy.

An endorsement is an addition to a standard policy that provides the driver with more coverage for an added charge.

If you’re a ride-share partner, ask the carrier that you’re with if they offer a ride-sharing endorsement.

This addition will provide you with some protection when your ride-sharing company doesn’t provide full protection.

How much does a ride-sharing endorsement cost?


Ride-sharing endorsements are not available everywhere but they are affordable alternatives to buying a commercial policy.

If you are currently insured with a carrier that does have a modern endorsement option available to you, you should see how much it will cost you. It all depends on the type of vehicle that you own and your driving record.

The pricing for the extra protection could cost you anywhere from $1.25 per month to 30 percent of your premiums. It’s all dependent on the carrier and how the charges are calculated.

Be sure to shop around and see if you could save on the endorsement by switching companies.

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Does Uber provide you with coverage?

Uber is one of the many ride-sharing companies that offers their drivers insurance protection. Unfortunately, there’s a gray area in how the coverage works when you must file a claim.

Typically, there’s always coverage when you have a passenger in your car. It’s before the rider gets in your vehicle that can get complicated. You must know how the coverage works before you count out buying extra coverage.

Some companies won’t provide coverage when you log in and start waiting for requests. Luckily for you, Uber does. When you log into your app and you are waiting, you will receive at least some third-party liability coverage.

Uber’s coverage will pay for injuries or property damage when you’re at fault for the accident.

Uber Coverage After You Accept a Ride Request


Once you accept a rider request and you’re transporting the rider in the car, you’ll have even more protection through Uber.

According to Uber’s insurance information, drivers are covered by the following coverages:

While you are in the middle of a request, you have a minimum of one million dollars of total liability coverage.

You also will receive at least one million dollars of bodily injury coverage for your own injuries if someone without insurance hits you.

As long as you already have full coverage on your car, Uber will pay to repair or replace your car after an accident if a 1000 dollar deductible is satisfied.

Your policy through Uber will protect you but there are always gaps in protection to consider. You don’t want to rely solely on the protection offered by the company’s insurance.

Make sure that you build some protection under your own policy as well. If you aren’t sure how much it costs to buy ride-sharing insurance, use our online comparison tool and start pricing the cost through the best insurers in the industry today.