Rideshare programs such as Uber or Lyft can be a great way to help make some extra cash this summer. With everyone out and about and more events coming up, more and more people are going to need rides. But if you don’t have the right kind of rideshare insurance, your side hustle could turn into a major financial struggle. While some rideshare companies do offer insurance packages when you sign up, they often aren’t enough to provide the full coverage you need.
When Rideshare Insurance Kicks In
If you get auto insurance through your rideshare program, then chances are, you aren’t always covered for accidents. A rideshare company policy typically only covers accidents when you’re actively performing a job.
This means you need to have a client confirmed on the app before your insurance will cover any incidents. Even if you’re signed into the app and are set as ‘available,’ you aren’t officially covered until a rider is confirmed. If you get into an accident while waiting for a rider to request a drive, you may have to pay out of pocket for injury or damage.
Personal-Use Coverage
If the car you use for your rideshare business is also your personal vehicle, you’ll need additional coverage for when you aren’t on the job. Rideshare insurance won’t cover your vehicle if you’re not actively using it for work. Because you need the proper coverage for accidents in Maryland, you might even face additional fees or tickets for driving without insurance.
Getting Additional Insurance Coverage
The basic package offered by your chosen rideshare program may be able to help while you’re working. But it’s often not enough to keep you covered throughout the rest of your driving time. Most drivers who have a rideshare business need to purchase additional insurance coverage. Getting the right kind of coverage can help ensure that your business is lucrative rather than draining your finances.
The Three Driving Periods and Why They Matter
Knowing rideshare insurance is easier when you break your driving time into three periods. Insurance companies and the rideshare app call these Period 1, 2, and 3.
Period 1 is when you’re off the clock and driving for yourself, like going to the store. Your personal auto insurance is supposed to cover you here.
Period 2 is when you have the app on and are waiting for a ride request. This is a major coverage gap. Your personal insurance often won’t cover you because you’re using the car for business. The rideshare company’s insurance offers very little until you accept a trip.
Period 3 is when you have accepted a ride and are either driving to pick up the passenger or taking them to their destination. This is when the rideshare company’s main insurance is active.
The big problem is Period 2. If you get into an accident while waiting for a request, you could be stuck with huge bills. A MAIF rideshare policy is designed to cover you during this risky gap.
What Happens If You Have a Coverage Gap?
So, what does a “coverage gap” actually mean for you? Imagine you have the Uber app on, waiting for your next customer. While you’re stopped at a red light, another driver rear-ends you.
If you only have a personal policy, your insurance company might find out you were logged into the rideshare app and deny the claim entirely. They could even drop you as a customer. At the same time, the rideshare company’s policy might only offer the state’s bare minimum coverage. This may not be enough to fix your car or cover all the medical bills.
This leaves you responsible for the rest. Having a proper rideshare policy from MAIF closes this gap and makes sure you’re never left paying for an accident that wasn’t your fault.
How Rideshare Insurance Protects Your Wallet
Think of a MAIF rideshare policy as a financial safety net. It’s not just about fixing cars; it’s about protecting your income and savings.
First, it helps cover costs that other policies won’t, like your car repairs and medical bills if you’re hurt. Second, it provides liability coverage. This means if you cause an accident, the policy helps pay for the other person’s car repairs and their medical expenses, which can be incredibly high.
Without this, you could be sued and have to pay for these costs out of your own pocket. Wiping out all the money you earned from driving all-together. By paying a little more for the right insurance, you’re protecting all the money you’re working so hard to make this summer.
Saving Money with MAIF Rideshare Insurance
If you need help getting proper coverage for your rideshare business, MAIF can help. We offer a wide range of insurance packages to help cover any rideshare need. Whether you just need some additional coverage for work or need to add personal coverage for everyday use, we’ve got you covered. Contact a MAIF insurance provider today to see what kind of coverage could be available for your business.