The Best Rideshare Insurance Options for Drivers (2021)

If you drive for a rideshare app like Uber or Lyft, you need a specific car insurance policy to be covered while you’re working. But even if you know you need this coverage, it can be tough to decide which policy is best for you. To make choosing a provider easier, MoneyGeek analyzed overall coverage, cost and location-based factors to find the best rideshare insurance options available.

By  
  |  

Whether you’re a full-time rideshare driver or you’re thinking of picking up rideshare driving as a side hustle, it’s important to know the basics of rideshare insurance.

According to the Insurance Information Institute, a standard auto insurance policy usually does not provide coverage for ridesharing. The typical personal auto insurance policy stops providing coverage from the moment a driver logs into a ridesharing app to the moment the customer has exited the car and the transaction is closed.

This means that even if rideshare drivers have auto insurance, they may not be covered if they get into an accident while they’re driving for work. Because of this, it’s crucial that these drivers purchase rideshare coverage, either as additional protection, a personal insurance coverage extension or a hybrid insurance package.

However, not all insurers issue rideshare coverage, and not all rideshare policies are created equal. The best auto insurance policies for rideshare drivers provide adequate coverage at a reasonable cost.

Table of Contents
Key Takeaways

denySign

Most standard auto insurance policies don’t include coverage for rideshare drivers.

insurance2

While rideshare companies typically provide some insurance coverage during certain phases of the rideshare process, drivers need to purchase additional insurance to ensure they’re fully covered in the event of an accident.

mglogo

State Farm is MoneyGeek’s top choice for best overall coverage for rideshare drivers.

Loading...

How Rideshare Car Insurance Works

When driving for a (Transportation Network Company (TNC) like Uber or Lyft, the rideshare app’s commercial insurance policy typically kicks in once you accept a fare or are transporting a passenger. However, this commercial TNC policy only provides limited insurance coverage when your rideshare app is on, but you haven’t accepted a fare.

To differentiate between when drivers for TNC’s are covered and when they aren’t, insurance companies break the rideshare process up into four phases:

  • Phases
    Description
  • Phase 0
    Your app is off. Your personal auto insurance policy covers you.
  • Phase 1
    Your app is on, and you’re waiting for a ride request. Your personal auto insurance policy without rideshare coverage won’t cover any accidents that occur during this phase. Some TNCs provide liability-only coverage to their drivers.
  • Phase 2
    You accepted a request and are en route to pick up a passenger or meal order. Most ridesharing and some delivery app companies offer coverage.
  • Phase 3
    You have passengers or food in the car. All ridesharing and delivery apps offer coverage, but the extent of that coverage varies from company to company.

Rideshare insurance can help cover the costs of accidents you get into during phases where you don’t have coverage through your TNC. Because coverage through most TNC's is limited and includes high deductibles, rideshare insurance also helps close gaps in coverage during phases where your TNC covers you.

The Best Rideshare Car Insurance Options

Rideshare car insurance is a relatively new form of auto insurance coverage, and the offerings from different insurers can vary widely. Insurers often cater to a variety of policy and coverage needs. Keep in mind that the best policy options may also vary by location.

Table of Contents

Best Overall Coverage: State Farm

If you’re looking for an auto insurance policy with robust coverage for rideshare drivers, State Farm is MoneyGeek’s top pick. State Farm's rideshare insurance makes sure that medical, emergency roadside assistance and rental car reimbursement coverage in your personal auto policy remains in effect when you’re working for a ridesharing company.

It also puts your personal policy deductible into effect, even if you’re driving for a TNC. The insurance extends all coverages from your auto policy when the app is on and you're available for hire. After you match with a rider or are transporting a rider, all coverages except liability insurance remain.

mglogo
MoneyGeek Top Pick
State Farm
  • What It Covers: Damage to your car, medical coverage, emergency road service, rental reimbursement and uninsured/underinsured motorist (UM/UIM) coverage.
  • What It Doesn’t Cover: Liability to others during phases 2 and 3.
  • Where It’s Available: Most states.
  • Cost Estimate: State Farm rideshare driver coverage generally adds about 15% to 20% to your current auto insurance premium, depending on the coverages you've chosen, any discounts that may apply and other rating factors.

Best for Cheapest Rideshare Insurance: Mercury

Mercury is an excellent option if you’re looking for affordable rideshare insurance. Rideshare insurance from Mercury protects you and your vehicle when your ride-hailing app is on, but you haven’t accepted a customer yet. In this way, Mercury fills in insurance gaps to ensure that you have continuous coverage throughout all parts of the rideshare driving process.

mglogo
MoneyGeek Top Pick
Mercury
  • What It Covers: Mercury will pay up to the policy limits to fix the damage to the other vehicle(s) along with any resulting injuries up to your policy limits. Mercury will also pay to have your car fixed, depending on the terms of the policy.
  • What It Covers: Mercury will pay up to the policy limits to fix the damage to the other vehicle(s) along with any resulting injuries up to your policy limits. Mercury will also pay to have your c fixed, depending on the terms of the policy.
  • Where It’s Available: 11 states.
  • Cost Estimate: As little as $0.90 a day, according to Mercury.

Best for East Coast Drivers: NJM Insurance Co.

NMJ Insurance Company is an option worth considering if you’re a rideshare driver who lives on the east coast. NMJ gives drivers the option to add a TNC rideshare endorsement to their policy. This add-on fills gaps in insurance protection between a driver’s regular policy and coverage from the TNC’s commercial liability coverage.

NJM provides coverage when rideshare drivers are actively using a rideshare app but haven’t yet accepted a passenger, including liability, UM/UIM, personal injury protection (PIP) and physical damage coverage.

The insurer also provides some limited coverage while the driver is picking up and driving a passenger. This additional coverage includes PIP coverage for the insured driver and reimbursement of the difference between the TNC carrier's deductible and the NJM deductible in the case of physical damage after an accident.

mglogo
MoneyGeek Top Pick
NJM Insurance Co
  • What It Covers: Liability, UM/UIM, PIP and physical damage coverage during phase 1.
  • What It Doesn’t Cover: Liability and UM/UIM during phases 2 and 3.
  • Where It’s Available: Five states.
  • Cost Estimate: Varies as a coverage add-on.

Best for Delivery Service Drivers: Progressive

Progressive is a good option for delivery drivers looking for adequate auto insurance coverage. While most personal car insurance policies don’t cover you when delivering food for a rideshare company like UberEats, Progressive allows you to add this type of coverage to your policy.

This coverage covers the gap between your personal policy and the delivery company and gives customers the option to customize their plan to account for on- and off-season driving. This policy is often much cheaper than other rideshare policies but still fills gaps in coverage for delivery drivers.

mglogo
MoneyGeek Top Pick
Progressive
  • What It Covers: Liability, comprehensive, collision, UM/UIM, PIP, roadside assistance and rental car reimbursement.
  • What It Doesn’t Cover: Liability, comprehensive, collision, UM/UIM and PIP during phases 2 and 3.
  • Where It’s Available: Most states.
  • Cost Estimate: Not disclosed.

Best for Drivers in Colorado or Illinois: Travelers

For drivers living in Colorado and Illinois, Travelers offers good rideshare insurance coverage. Available in these two states only, this limited ridesharing coverage endorsement can help protect individuals who drive for TNCs. This endorsement to your auto insurance policy provides you coverage for when you turn on your ridesharing app but ends when you connect with a passenger.

mglogo
MoneyGeek Top Pick
Travelers
  • What It Covers: Not stated.
  • What It Doesn’t Cover: Not stated.
  • Where It’s Available: Colorado and Illinois.
  • Cost Estimate: Not disclosed.

Best for Military Members, Veterans, and Their Families: USAA

Available only for veterans, active service members and their families, USAA provides fantastic rideshare insurance coverage. USAA’s rideshare coverage is designed to fill the gap between when you turn on your rideshare app and when you accept a request. If you have a USAA auto insurance policy, you can purchase additional rideshare coverage for as little as $6 a month.

mglogo
MoneyGeek Top Pick
USAA
  • What It Covers: Extends regular auto insurance coverage to phase 1.
  • What It Doesn’t Cover: Coverage during phases 2 and 3.
  • Where It’s Available: 42 states.
  • Cost Estimate: As little as $6 per month.

Best for Extending Personal Coverage: American Family

American Family allows rideshare drivers to extend their existing personal policy to phase 1. American Family Insurance describes its coverage, called the American Family Rideshare Endorsement, as an “add-on” to your ongoing personal policy with American Family.

This add-on is the equivalent of rideshare gap coverage. It provides the same coverage as your personal auto policy, including bodily injury liability, property damage liability, collision, comprehensive, medical payments coverage and personal injury protection.

mglogo
MoneyGeek Top Pick
American Family
  • What It Covers: The same bodily injury liability, property damage liability, collision, comprehensive, medical payments coverage and personal injury protection limits as your personal policy during phase 1.
  • What It Doesn’t Cover: Phases 2 and 3.
  • Where It’s Available: Most states.
  • Cost Estimate: Not disclosed.

Best for a Low Deductible: Esurance

Esurance offers low deductible rideshare insurance through their SmartShare program. Only available in California, Illinois and New Jersey, this policy ensures no gaps in coverage between your personal policy and the rideshare app insurance policy. SmartShare will also cover the difference between your Esurance and rideshare company deductibles. The policy covers collision coverage and comprehensive coverage if already included in your personal policy, liability coverage up to your personal policy limits, plus all your personal coverages.

mglogo
MoneyGeek Top Pick
Esurance
  • What It Covers: Collision coverage, comprehensive coverage, liability coverage and other personal coverages.
  • What It Doesn’t Cover: Not stated.
  • Where It’s Available: California, Illinois and New Jersey.
  • Cost Estimate: Not disclosed.

Comparing Companies That Offer Rideshare Insurance

There are a variety of different insurance options available for rideshare drivers. Which insurer is best for you depends on whether you’re looking for a policy with the most robust coverage, lowest price or other perks, like commercial insurance coverage. Some policies are only available in a few states, so make sure that you choose a policy that’s available where you live.

Insurance Company
What It Covers
Where It’s Available
Who It’s Best For
Who It’s Not For

State Farm

Damage to your car, medical coverage, emergency road service, rental reimbursement, and uninsured/underinsured motorist coverage

Most states

Drivers looking for robust coverage

Drivers looking for liability coverage during phases 2 and 3

Mercury

Mercury will pay up to the policy limits to fix the damage to the other vehicle(s) along with any resulting injuries up to your policy limits. Mercury will also pay to have your vehicle fixed, depending on the terms of the policy.

11 states

Drivers looking for an affordable policy

Drivers outside the geographic area where this insurer provides coverage or drivers who want additional coverage during phases 2 and 3

NJM Insurance Co.

Liability, UM/UIM, PIP and physical damage coverage during phase 1; some coverage during phases 2 and 3

Five states

East coast drivers

Drivers outside the east coast

Progressive

Liability, comprehensive, collision, UM/UIM, PIP, roadside assistance and rental car reimbursement

Most states

Delivery service drivers

Drivers who want additional coverage in phases 2 and 3

Travelers

Some coverage during phase 1

Colorado and Illinois

Drivers in Colorado and Illinois

Drivers outside Colorado and Illinois

USAA

Extends regular auto insurance coverage to phase 1

42 states

Military members, veterans, and their families

Drivers who haven’t served in the military

American Family

Bodily injury liability, property damage liability, collision, comprehensive, medical payments coverage and personal injury protection during phase 1

Most states

Drivers interested in extending personal coverage

Drivers who want additional coverage in phases 2 and 3

Esurance

Collision coverage, comprehensive coverage, liability coverage, other personal coverages

California, Illinois, and New Jersey

Drivers looking for a low deductible and looking to fill gaps in coverage during all three phases

Drivers who live outside these states

Frequently Asked Questions About Rideshare Insurance

About the Author


expert-profile

Margaret Wack is a freelance writer who covers insurance, saving, investing, banking, and more. Margaret earned a bachelor's degree in classics, comparative literature, and poetry from Smith College and a master's degree from St. John's College.


sources