As soon as you turn the ride-sharing app from Uber on, your personal insurance coverage ceases to operate. Does Uber provide car insurance during the waiting period? The answer is No. So, in effect you have no coverage during the waiting period, even if you have a personal policy for coverage. This creates a gap in the coverage.
According to Uber’s insurance company, James River Insurance Company, the ride is divided into three periods and the coverage provided to the driver depends on the ride period s/he is in. Period 1 is when the driver is waiting for a passenger with the Uber app on. Period 2 is when the driver is on her/his way to the passenger. And, Period 3 is when the passenger is in the car. Uber car insurance policy only kicks in for Period 2 and 3 and provides liability coverage (no collision coverage) for Period 1. So, unfortunately, if you meet with an accident in Period 1, you are neither protected by uber driver car insurance nor your personal insurance.
Your personal insurance policy will only cover the damages caused to the other vehicle but not yours. And, Uber acts only as a secondary coverage and provides insurance when a driver turns to Uber after being denied by her/his personal insurer. Therefore, to ensure you are protected at all times, you must check both with Uber and your personal insurer.
Drivers are required to provide proof of insurance before they can access the Uber app. Uber car insurance cost depends on the extent of coverage that the drivers choose. Every Uber ride is covered by $1 million insurance policy and each period is covered by liability coverage to meet the minimum coverage requirement as mandated by the respective states. However, to cover the gap in the insurance coverage, drivers need to choose an add-on rideshare endorsement which is added to the existing auto insurance policy.
The add-on provides the driver with full liability coverage on her/his insurance policy during the waiting period (Period 1). Drivers should contact their insurance company for more information on the type of rideshare car insurance available.