A lot of driver friends told Inpooling that they got dropped by their insurance companies when they run into an accident while driving for Uber/Lyft. It is a tough job as a rideshare driver. It is even tougher when you drive without a peace of mind.
The official name for a ridesharing business is a Transportation Network Company (TNC). TNCs contract with drivers who use their personal vehicles to transport passengers. Therefore, many of the drivers who work for TNCs do not have a livery driver’s license, and their cars are neither registered nor insured as commercial vehicles. However in some states (i.e., California, New York), it is now required to register to have a business if you are doing rideshare.
Your personal auto-insurance policy is unlikely to cover any expenses arising from accidents that occur when you’re driving for Uber, Lyft or any other TNC. Your insurer could even cancel your personal policy if it finds out you haven’t disclosed you work as a driver for a ridesharing service.
Personal auto-insurance policies are not designed, underwritten or priced for commercial ride-sharing. The assumption is that private-passenger motoriests drive themselves, family members and friends with an average annual travel of 12,000 miles. And there is no money earned from these private trips.
While UBER/Lyft provide insurance coverage when the App is on, the high deductibles (1K for Uber, 2.5K for Lyft), need to be paid by the drivers for his own car damage.