UPDATE ON RIDESHARING INSURANCE

In my previous post on rideshare coverage I briefly mentioned how I've had quite a few clients that have been told that they are indeed covered by their current policy, even though there is no actual endorsement or any clause that specifically states they are covered. After reaching out to The Rideshare Guy I received some valuable information for any ridesharers out there that might have also been told this same thing. 

In a recent memo sent out to State Farm agents the issue of ridesharing was addressed. In the memo the company stated, "that as long as livery wasn't the main use of the vehicle", there would be no grounds for cancellation or termination of your policy. Awesome news right? Not so fast. Yes this means if you drive less than 50% of your miles for ridesharing purposes you won't be dropped/ But this does nothing for you in terms of coverage. Just because the company has said no you will not be dropped, that doesn't translate into yes you are covered in an accident. While not being dropped is a great thing, not being covered in period 1 is still not any good news at all. The whole point of the ridesharing coverage is to insure you for period 1, the time when you are most vulnerable as a driver because there isn't a responsibility for any company to cover your loss.

Then there is the second issue. Driving less than 50% of your miles for ridesharing could be quite difficult. If you are doing ridesharing part time or even just doing it on the side you could easily surpass 50% of your miles driven for rideshare purposes. Lets say you drive 3 days out of the week for a good amount of time. Those drives could contain a fair amount of miles driven. If you compare it to your everyday commute to work the other 3 days a week, you might find you don't put on too many miles for work, or "pleasure" commutes. Maybe your work is only a couple miles away from your home, meaning you only average about 30 miles to and from work a week. Those miles could be matched quickly while ridesharing. And forget about staying under 50% if you drive rideshare as a primary job. This could leave you in a situation where you could be dropped and even worse, find yourself uninsured in period 1. Taking all of the responsibility and risk yourself. 

Everyone who is ridesharing needs to be aware of what is explicitly stated in each of their policies and know the exact coverage in every situation. I don't want any driver out there to think they are covered because their agent said they were, when in reality the agent didn't disclose the while story to the customer. Please make sure to review your policy and feel free to reach out to me with any questions you might have regarding ridesharing policies. Drive safe everyone!

Ridesharing, am I covered?

The Ridesharing issue has been out and about for quite a while now depending on where you are. For those who don't know drivers for Uber, Lyft and other companies like sidecar, were out of luck when it came time for a claim while operating as a contracted rideshare driver. The issue arouse simply because rideshare is growing tremendously and everyone is trying to play catch up, even the insurance companies. Simply put it outgrew the market as far as support is concerned.

Mainly the issue has been that some carriers were dropping their customers or even worse not paying claims because the operator was driving as a rideshare driver. Now I am nowhere near the expert that  The Rideshare Guy is, but I have slowly been learning about this huge community. Essentially when a driver picks up his or her passenger the respective rideshare company they are contracting with will take over as their insurance carrier and give 1 million dollars in coverage to the driver. This has been great so far, as drivers are covered substantially. The issue lies in the grey in-between stages of
picking up your passenger. What has been happening is a driver logs into the app to see if there are any potential passengers in the area looking for a ride. At this point the driver may be sitting in their car or just patrolling the roads waiting for a passenger to request a pick up, this is where things became unknown. Lets say that you as a driver are logged into the app and you are cruising the streets, maybe even driving to the store. Now lets assume the worst, you get into an accident, and its your fault. When, not if, your insurance company discovers that you were logged into the app they will assume you were operating as a business and not as personal auto policy holder. Leaving you without any coverage at all and potentially hundreds of thousands of dollars in debt, in medical payments to others or in property damages. This is where some companies are doing the right thing and covering you when you need it.

Some companies have stepped up to the plate and implemented an explicitly stated policy that clearly states YOU ARE COVERED. This is huge considering its a guessing game with some other insurance providers. I have heard stories of certain companies issuing nationwide memos to agents stating that clients will be covered in the event of an accident, but if it were me, I wouldn't risk my assets and my future by believing a memo. What if the company decided they actually have been receiving too many claims and withdraw their statement in that memo? There is no proof or explicitly stated material that you have in your own possession that guarantees coverage.

There is also the issue of how will my company even know if I was logged in? My opinion on that is simple. No insurance company wants to pay claims that they don't need to pay. If you have ever had a claim you know that both companies will thoroughly investigate every minute detail of the accident. This is for the reason I stated above, no company will pay a claim that they legally do not have to pay. Its money out of their pocket and if they can keep it in their pocket they will. Another opinion I have is that it is information that can be tracked. I don't know the specifics or logistics of how the apps work or how they can track where you are or things of that nature. What I do know is that even a Facebook post that has been deleted can be tracked. Once its online, most people agree it can be found. I would assume that you as a driver being logged into the app and then not picking up your passenger because of an accident would be tracked. Like I said, I don't know the whole logistics of everything but I would rather err on the side of caution and just assume they can track what happened and the insurance company could find out that I was indeed a driver and I also was logged into the app. Now I have had some people act like their insurance company won't find out that they were logged in because, "why would I tell them?". Well if you withhold that information when your insurance company asks you a specific ridesharing question, and you lie, you have now committed insurance fraud. Which can be a felony, not something you would really want.

My honest advice is that if you are actively driving as an rideshare driver, and you do not have a commercial policy, you should get a document that explicitly states your coverage in the event of an accident while you are logged into your app and not yet covered by the Rideshare company. The drivers out there need to have a secure policy to insure they are covering their future for themselves and their loved ones. Post your questions below and drive safely!