Over the last few months, it is likely that you have heard about this thing called Uber—via news headlines, casual conversations and radio shows.
So, what is Uber? According to the Uber website, it is an app for your iPhone or Android phone that allows you to find safe, reliable transportation with the touch of a button. Rates appear to be reasonable (depending on the level of service you choose) and you are able to track the progress of your driver via your phone.
As a driver for Uber, you are allowed to use your own car and basically determine your own work schedule. Uber does require that your car is a 2006 or newer, but they will make exceptions for older luxury sedans. They also require a vehicle inspection. To ensure the safety of its passengers, they also require that drivers submit to a thorough criminal background check. You are also required to have a smartphone.
It sounds simple, doesn’t it? Provide a needed a service and make money doing it. But, there is an aspect of being an Uber driver that has been the cause of some controversy and much discussion. The issue is this: How does being a driver for Uber affect your car insurance?
Uber does require that you have personal auto insurance and specifies the limits of coverage you’ll need to carry. Uber even provides additional coverage for its drivers. But, is it the correct coverage and will it protect you if you are in an accident?
Uber insists that personal auto insurance is sufficient and provides the correct coverage for its drivers. However, many major insurance carriers disagree and have started to cancel policies if they discover that a vehicle is being used to carry passengers for a fee. Uber’s insurance also doesn’t cover drivers while they are looking for new fares; doesn’t this potentially create a big gap in coverage for its drivers?
And while Uber has temporarily ceased operating in Portland, that will change in a few months. If you are considering becoming a driver for Uber (or any ride share company), we strongly encourage you to check with your personal auto insurance agent regarding your coverage. In our research of this matter, a commercial auto policy will provide the appropriate coverage.
We will likely see new developments as Uber continues its rapid growth and comes under more scrutiny from the public and from state and local governments. We will strive to keep our readers informed about this on-going issue.