Uber vs. Your Car Insurance

Uber vs. Your Car Insurance

Do you have auto insurance coverage if you are an Uber (or Lyft) driver?

A lawsuit was recently filed in Texas by a group of taxi cab and limousine companies against the growingly popular car service Uber. The lawsuit alleges that Uber is violating existing statutes and is operating an unlicensed service.

Uber contracts with various transportation entities and individuals to provide a web-based service designed to shorten the wait times and create a more personal transportation experience. Users can use the Uber app to request a ride and will see the vehicles in the area that are available to pick them up. Users like the service because it is often faster than waiting for a traditional cab and in some cities the name of the driver is shown making the trip a more personal experience. Who wouldn't prefer riding in a personal vehicle as opposed to a cab?

Driving for Uber would appear to present a great opportunity to make a few extra dollars. To qualify, a driver must be 23 years old with a personal license, personal auto insurance, and have a mid-size vehicle in excellent condition. There is a background check as part of the driver approval process.

Should you inquire about how your personal auto insurance coverage applies, the answer is simple. It doesn't. Well at least most policies won't. Some companies are adding optional endorsements to personal auto policies that will extend coverage to livery, or in other words, passenger transport for hire. A normal insurance policy has an exclusion that applies to both the liability and physical damage portions of the policy. The exclusion eliminates coverage while the vehicle is being used as a public or livery conveyance. The intent of the exclusion is to exclude the hazards associated with the operation of an automobile for hire to the general public.

The best answers to all insurance questions come from personal conversations with your independent insurance agent. Please contact King Insurance Solutions for more info about Uber and Lyft!

Source: Jim Gavin, Insurance Information Services of Independent Insurance Agents of Texas

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