How is Uber Impacting the Insurance Industry?

Since traditional auto insurance policies may not cover an Uber driver’s passengers or other damages incurred during an accident, Uber has taken the lead on putting its own insurance policies in place. In 2014, Uber reported that it had a $1 million commercial liability policy from the James River Insurance company enforced for all ridesharing participants.  Here’s a closer look at how Uber is impacting the insurance industry:

What’s Covered by Uber’s Insurance Policy?

The policy covers the liability of drivers for up to $1 million per incident for bodily injury or property damage to passengers, pedestrians, other vehicles, etc. It also covers underinsured or uninsured motorists.

Uber’s policy also includes coverage for the time between trips since most auto policies that Uber drivers might already have typically do not provide coverage when a driver is not carrying a passenger on a route. The policy includes $50,000 comprehensive and collision insurance. Uber drivers operating in states that require Personal Injury Protection also get no fault coverage.

Uber Drivers and Existing Auto Insurance Policies

While Uber is taking steps to ensure all of its drivers are insured with supplemental coverage, it’s important to note that those drivers are only covered when the Uber app is turned on. When that driver is using their vehicle for personal use, they revert back to their regular auto insurance policy. The personal auto insurance policy may not provide full coverage but most drivers who use their vehicle for both commercial and personal use will go ahead and get comprehensive coverage.

Auto insurance companies and auto insurance sales agents need to be in front of these drivers to ensure these drivers are adequately insured. These drivers may want extra coverage to protect their friends and family during non-working hours and benefit from the supplemental coverage Uber provides when they turn on their app to work.

Buying Ridesharing Insurance

Some auto insurance companies have developed ridesharing insurance products specifically for drivers who use their vehicles for ridesharing programs like Uber. Coverage may only be available in certain states and typically works as a hybrid policy, replacing an existing personal auto policy. There may also be restrictions on how many miles the individual can drive with coverage and some companies limit the product for drivers who are working for only Uber or Lyft. Many of these plans have low deductibles and are ideal for those who want to have some peace of mind that they have full coverage whether they are working or not.

If you are looking for insurance jobs in the auto insurance industry, it helps to stay informed about buying trends and consumer needs. Many Uber drivers may now be looking for hybrid coverage plans to ensure they are fully insured both on and off the job. While Uber does provide supplemental coverage, drivers still need to have an existing personal auto insurance policy in force and can only take advantage of supplemental coverage when the Uber app is turned on.

Making sure these drivers have adequate coverage with the right sales and marketing approach can help insurance agents and companies tap into a larger buying market as Uber continues to grow and expand its reach.

Image by ​Mark Warner.