Fresh out of college, he knows all the hot places to go in town. Brian drives to a familiar part of the city with bars and restaurants. It's his first Friday night as a rideshare driver. After logging onto his Uber app, he slowly circles the block a few times and waits to be matched to a rider. This is what we refer to as Period 1. For Brian, this period only lasts 5 minutes.
Brian is confident that this will be a breeze. He’s thinking about how quickly his student loans will be paid off, when he’s alerted that he just got matched to a rider (Period 2). Soon after, he picks up his rider, and is now in Period 3.
Brian’s good to go, right? This new opportunity will get him ahead in no time.
Let’s go back to Period 1.
In those 5 minutes while Brian was logged on waiting to be matched to a rider, he may as well have been uninsured.
Isn’t that covered by Uber?
Here’s the breakdown:
Uber knows there is an increased risk of accidents in those busy areas with people coming and going, and that’s where drivers are likely to be during Period 1.
They offer limited liability only, and no comp and collision coverage.
If Brian had gotten into an accident in those 5 minutes he circled the block, and damaged his prized Acura by taking his eyes off the road for one second, he would have been out of luck.
What about Brian’s current insurance company?
So what’s a rideshare driver to do?
- Insurance companies like Farmers are seeing the problem with the gap during Period 1. On May 27, 2015, Farmers announced they’ll offer the only auto policy in California that will make sure drivers like Brian are covered.
- Brian can get coverage for Period 1, and from there Uber takes care of the rest.
- When it comes to Periods 2 and 3, Uber will cover up to 1 million in liability, and comp and collision (provided that you carry it on your vehicle through your current carrier).
What's the moral of the story?
Call me. Jerry Farcone. I've got your rideshare insurance problem solved!