Driving for a rideshare or delivery app is one of the most common side jobs in the country. It's also one of the most common sources of insurance confusion. Many drivers assume their personal auto policy covers them, or that the app's insurance covers everything. The truth sits in between, and the gaps depend on what the app is doing at the moment of an accident.
Why personal auto policies have a problem with gig driving
Most personal auto policies exclude or restrict coverage while the vehicle is being used to carry people or property for a fee. This is often called the "livery" or "public or livery conveyance" exclusion, and some policies add specific exclusions for transportation network company (TNC) or delivery activity. If you crash while working and your insurer applies the exclusion, it may decline the claim, and it may non-renew your policy after learning about the business use.
The NAIC has published consumer information on ridesharing and insurance for years, and many state regulators have their own guides; find yours through the NAIC directory.
The three "periods" of rideshare driving
Insurance for rideshare drivers is usually described in periods, and California law uses this structure explicitly in Public Utilities Code §5433: PUC §5433.
- Period 0 (app off): you're a regular driver. Your personal auto policy applies normally.
- Period 1 (app on, waiting for a request): under California law, the TNC or driver must maintain primary coverage of at least $50,000 per person / $100,000 per incident for bodily injury and $30,000 for property damage, plus at least $200,000 of excess liability per occurrence. These limits are lower than in later periods, and TNC coverage in this period typically doesn't include collision coverage for your own car.
- Periods 2 and 3 (accepted a ride through drop-off): California requires $1,000,000 of primary liability coverage. During Period 3, while a passenger is in the car, the TNC must also provide uninsured/underinsured motorist coverage of $60,000 per person and $300,000 per incident under the current statute.
The California Public Utilities Commission regulates TNCs and posts insurance information on its TNC insurance requirements page. Check the statute itself for the most current figures, since the law has been amended. Other states have their own TNC laws with similar period-based structures.
Where the gaps are
- Period 1 damage to your own car. App-provided coverage often doesn't cover physical damage to your vehicle while you're waiting for a request.
- Deductibles. When app-provided collision coverage applies, it may carry a high deductible.
- Lower limits in Period 1. If you cause a serious accident while waiting for a ride, $50,000/$100,000 may not be enough.
- Personal policy cancellation. Even if the app's coverage pays, your personal insurer may non-renew you for undisclosed business use.
- Delivery driving. Food and package delivery apps may not be TNCs under the law, and their insurance programs vary widely; some provide only contingent liability during active deliveries, and nothing for your own car.
Rideshare endorsements and hybrid policies
Many insurers now offer a rideshare endorsement on a personal auto policy. It typically extends your personal coverages (including collision and comprehensive) into Period 1, and sometimes covers the app's deductible gap in later periods. Some insurers also offer endorsements for delivery driving. These endorsements are usually inexpensive relative to the risk they address. Ask:
- Does it cover Period 1 only, or deductible gaps in Periods 2 and 3?
- Does it include delivery apps as well as rideshare?
- Are there limits on hours or income?
When you need commercial auto
A personal policy with an endorsement fits occasional and part-time app drivers. You may need commercial auto if you:
- Drive full time or use multiple vehicles for business.
- Operate as a business entity with employees driving.
- Use a vehicle titled to a business.
- Drive for a limousine service or other for-hire operation that isn't a TNC, which usually requires its own permits and commercial insurance (in California, charter-party carriers are regulated by the CPUC).
- Haul goods for multiple customers outside the app ecosystem, such as courier or box-truck delivery, where federal or state motor carrier rules may apply. See our FMCSA insurance requirements guide.
Other coverages gig drivers should consider
- Uninsured/underinsured motorist on your own policy, which matters in Period 0 and Period 1.
- Medical payments or PIP, depending on your state.
- Rental reimbursement: if your car is in the shop, your income stops.
- Gap coverage if your car is financed or leased.
- Occupational accident insurance: some apps offer it; it isn't the same as workers' comp.
- Disability income insurance to replace earnings if you're hurt and can't drive. See our disability insurance basics.
Be honest with your insurer
Tell your insurer you drive for an app. The price of a rideshare endorsement is small compared with the risk of a denied claim or a cancelled policy. If your insurer doesn't offer an endorsement, an independent broker can find one that does.
After an accident while driving for an app
- Make sure everyone is safe and call police if required.
- Take photos, including a screenshot of the app showing your status (offline, waiting, en route, passenger on board).
- Report the accident in the app and to your personal insurer.
- Exchange information with other drivers.
- Keep records of lost income for rental reimbursement or claims.
Checklist for gig drivers
- ☐ Tell your insurer you drive for an app
- ☐ Add a rideshare or delivery endorsement
- ☐ Know the app's coverage in each period and its deductibles
- ☐ Raise your own liability and UM/UIM limits
- ☐ Add rental reimbursement and gap coverage if needed
- ☐ Consider commercial auto if you drive full time or operate as a business
Contact Alishahi Insurance or call (877) 711-4545 to review your coverage.
Frequently asked questions
Does my personal auto insurance cover me while driving for Uber or Lyft?
Usually not while the app is on. Most personal policies exclude carrying passengers or goods for a fee unless you add a rideshare endorsement.
What is Period 1 in rideshare insurance?
Period 1 is when the app is on and you're waiting for a ride request. In California, the TNC or driver must carry at least $50,000/$100,000/$30,000 primary liability plus $200,000 excess during this period.
How much insurance does California require during a rideshare trip?
From accepting a ride until drop-off, California requires $1,000,000 of primary liability coverage under Public Utilities Code §5433.
Do delivery drivers need a special endorsement?
Often yes. Delivery app coverage varies and may not cover your own vehicle. Many insurers offer endorsements that extend personal coverage to delivery driving.
When do I need commercial auto insurance as a gig driver?
If you drive full time, use business-owned vehicles, employ drivers, or operate a for-hire service outside the TNC framework, commercial auto is usually required.
Alishahi Insurance · 439 N Canon Dr, Penthouse, Beverly Hills, CA 90210 · (877) 711-4545 · CA License #4348151. General information only. This isn't legal, tax or financial advice or a coverage determination. Coverage depends on policy language and underwriting, and rules vary by state.