How Uber and Lyft Affect Car Insurance Rates (2023)

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The rideshare apps Uber and Lyft dominate the rideshare service market. Customers of Uber and Lyft likely do not need to worry about how utilizing the service might impact their own insurance coverage rates, though recommended steps exist in the event of an accident. Insurance costs and coverage for rideshare drivers, on the other hand, vary.

Everyone needs insurance coverage that meets their individualized insurance needs at an affordable price. Because insurance companies calculate auto rates based on many factors, no one-size-fits-all car insurance policy exists. With the Insurify car insurance comparison tool, users compare quotes from dozens of top national and regional auto providers in minutes.

Quick Facts

  • Rideshare customers typically do not need additional auto coverage to use the service.

  • Uber and Lyft provide commercial coverage, though more insurance is often needed.

  • At-fault accidents, DUIs, and speeding tickets tend to increase auto rates for all drivers.

Does driving for a rideshare service like Uber or Lyft affect your car insurance rates?

How does driving for uber and lyft affect insurance rates?

Rideshare drivers pay more on average for car insurance.

Unlike rideshare customers, drivers face responsibility for the vehicle they drive. Uber and Lyft provide commercial auto insurance that applies to drivers while actively driving customers. Time between ride requests and pickups and personal car usage falls into different categories that require coverage beyond the driver’s personal coverage and the coverage provided by the rideshare company.

It should also be noted that coverage from Uber and Lyft may be lacking in the event of an accident. Given the prevalence of ridesharing, many insurance providers now offer rideshare insurance options for policyholders working for a transportation network company. Unfortunately, the protection from these policies comes at an additional cost for the drivers.

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What protection does rideshare coverage provide for rideshare drivers?

Often, rideshare drivers purchase a rideshare endorsement add-on to their personal coverage that increases premiums between 15 and 20 percent. Sometimes, this type of add-on is referred to as gap coverage since it makes up for coverage gaps in someone’s commercial or personal car insurance. Uber drivers and Lyft drivers benefit from purchasing more coverage.

Generally speaking, available rideshare insurance varies in its coverage depending on the inclusion of policies like comprehensive coverage, collision coverage, liability coverage (including property damage liability and bodily injury liability), and more. An individual’s deductible and monthly premium will ultimately depend on their rideshare insurance policy.

Who offers rideshare coverage?

Many national and regional insurance providers now offer rideshare coverage for their customers, including Allstate, GEICO, State Farm, USAA, American Family, Safeco, Erie, Farmers, Mercury, and more. Companies like Amigo USA, Mile Auto, Anchor, Novo, and AssuranceAmerica offer some of the cheapest rideshare coverage available.

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What to Do as a Driver in the Event of a Rideshare Vehicle Accident

Ideally, drivers will meet or exceed the necessary state insurance requirements through their personal coverage and the commercial coverage provided by either Uber or Lyft. Otherwise, an uninsured driver responsible for an accident faces hefty fees and legal ramifications, including license suspension. If you have coverage, the process of filing a claim is fairly straightforward.

In the aftermath of an accident, both Lyft and Uber recommend first ensuring the safety of everyone involved in the accident and contacting police (and paramedics if necessary) prior to notifying the rideshare company and additional insurance providers of the collision. The claims process and available coverage will ultimately vary based on the rideshare driver’s coverage.

Collecting Necessary Information

As always, drivers in an accident should collect any and all relevant information about the car collision. Make a note of all vehicle information, driver contact information and license number, insurance information of everyone involved, and the specific location and time of the collision. Additionally, take photos of any and all evidence of vehicle damage or relevant personal injury.

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Does using a rideshare service like Uber or Lyft as a customer affect your car insurance rates?

In the majority of cases, utilizing rideshare services has no impact on a customer’s personal auto insurance policy. Rather, the policy of the rideshare vehicle driver or the commercial policy of the rideshare company covers any routine or additional insurance expenses. Because the customer has no stake in the vehicle or the policy, there is no need to stress about coverage.

Utilizing rideshare services as a customer results, of course, in costs for each ride and a tip for the driver. While these services provide a convenient transportation option for some, it can become costly if it is a person’s primary form of transportation, due to fluctuating prices and events causing surge prices. Infrequent usage allows for customer convenience and safety.

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What to Do as a Passenger in the Event of a Rideshare Vehicle Accident

Both Uber and Lyft recommend ensuring the safety of everyone involved in the auto collision and contacting the police or paramedics prior to notifying the rideshare and insurance companies of the incident. In the event of an accident, collecting written and photographic details about the vehicles, drivers, and the crash is helpful and important for the claims process.

Though passengers of rideshare vehicles likely have no liability or responsibility in the situation, passengers in this situation should call their insurance agent or local insurance office to inform them of the accident and inquire about whether anything needs to be done on your end. In some cases, your insurance provider may pay for personal injuries from the accident.

How to Find Affordable Auto Insurance for Rideshare

In this day and age, affordable car insurance is an absolute must. Car insurance rates fluctuate over time and depend on each individual’s personal and driving profile, which means no perfect insurance plan exists. Find the best option for insuring your own car by comparing quotes from top providers in the insurance industry with the Insurify car insurance quote-comparison tool.

Frequently Asked Questions

  • Yes, most rideshare drivers need to purchase additional rideshare coverage, sometimes in the form of an add-on rideshare endorsement to their existing personal auto coverage. On average, coverage of this nature increases insurance rates between 15 and 20 percent. Rideshare drivers typically pay more than non-rideshare drivers due to driving frequency and other factors.

  • In most cases, using a rideshare service as a customer has no impact on insurance rates. As a customer, no liability or vehicle responsibility falls on them. Rather, rideshare drivers and the companies they work for face responsibility for being properly covered by their insurance. Sometimes, a customer’s personal insurance provider may provide injury coverage if necessary.

  • Safety is the priority, so always ensure everyone is safe and notify the police (and paramedics if necessary) before anything else. Once the scene is stable, take photos of the scene, and note necessary information of those involved in the accident, as well as vehicle and accident information. Drivers and passengers should contact their rideshare and insurance companies.

  • Finding insurance that meets your individualized insurance needs at an affordable price feels overwhelming at times. With the Insurify car insurance comparison tool, users easily compare monthly quotes from dozens of national and regional auto insurance providers. With just a few clicks from the convenience of home, users learn how much they can save on their coverage.

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  • Data scientists at Insurify analyzed more than 40 million real-time auto insurance rates from our partner providers across the United States to compile the car insurance quotes, statistics, and data visualizations displayed on this page. The car insurance data includes coverage analysis and details on drivers' vehicles, driving records, and demographic information. Quotes for Allstate, Farmers, GEICO, State Farm, and USAA are estimates based on Quadrant Information Service's database of auto insurance rates. With these insights, Insurify is able to offer drivers insight into how companies price their car insurance premiums.

Katie Powers
Katie PowersInsurance Writer

Katie Powers is an insurance writer at Insurify with a producer’s license for property and casualty insurance in Massachusetts and expertise in personal finance and auto insurance topics. She strives to help consumers make better financial decisions. Prior to joining Insurify, she completed her undergraduate and graduate degrees at Emerson College. Her work has been published in St. Louis Magazine, the Boston Globe, and elsewhere. Connect with Katie on LinkedIn.