As of July 1, 2015, Ridesharing companies (like Uber and Lyft) must have liability insurance to cover injury, death, and property damage caused to third parties while the Ridesharing app is open, but while the driver is waiting to match with a passenger.This period when the app is on but the driver is not matched with a passenger is called Period 1.

The law adds that a drivers’ personal insurance for their private vehicles can no longer cover Period 1. This prevents Ridesharing companies from claiming their insurance policies shouldn’t kick in because drivers already have personal coverage.

According to Uber, more than a million people have already driven for the startup. Moreover, Uber and other Ridesharing companies are aggressively recruiting more drivers. If Ridesharing drivers don’t choose to purchase their own Ridesharing insurance policy on top of their personal coverage, the Ridesharing companies must provide coverage during Period 1.

Below is the breakdown of coverages during each period of a rideshare trip a Rideshare Company must provide:

Period 1 (also known as the gap period): the driver turns on the app and is waiting to match with a passenger

  • $50,000 minimum coverage for injury to a single person
  • $100,000 minimum coverage for injury to multiple persons
  • $30,000 minimum coverage for property damage
  • The Ridesharing company must also maintain $200,000 in excess insurance in the pre-match period.

Period 2: the driver is on the way to pick up a matched passenger

  • 1 million in liability coverage

Period 3: the driver picks up the matched passenger until the passenger exits the vehicle.

  • 1 million in liability coverage

Important to note regular personal auto insurance policies provide no coverage for Ridesharing.
After the driver accepts a trip request from a rider, the coverage jumps up to $1,000,000 until the completion of the passengers trip.

If you were injured as a passenger in an uber/lyft or any rideshare car or hit by an uber/lyft driver, please call our office for a free evaluation of your case. We are ready to serve you.

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