Mercury Insurance Debuts Coverage for Uber and Lyft Drivers

The coverage provides drivers with insurance that bridges the gap between their personal auto policies and coverage provided by their TNC. The coverage is currently available only to California rideshare drivers.

(Image source: Uber.)

Mercury Insurance (Los Angeles) has launched ride-hailing insurance to cover Uber, Lyft, and other transportation network companies (TNCs). The coverage provides drivers with insurance that bridges the gap between their personal auto policies and coverage provided by their TNC. The coverage is currently available only to California rideshare drivers.

Exactly what policy covers a driver at what point in his or her activities has been a point of contention associated with the emergence of the ridesharing/ride-hailing phenomenon. Drivers have been considered without coverage by their insurers when they got into an accident while their ride-hailing app was on but before they had accepted a ride. Mercury’s new coverage closes that gap and provide drivers with access to coverage throughout their entire ride cycle. Previously they were only covered by TNC commercial insurance upon accepting a fare.

(Related: Insurer-TNC Compromise Paves Way for Rideshare Insurance Regulation)

“Many Californians enjoy driving for companies like Uber and Lyft as a great way to earn a living or make extra cash because they can set their own hours, be their own bosses and meet new people,” Jim Reeves, research and development group manager, Mercury. “Many of them are unknowingly putting themselves and other drivers at risk, however, because they don’t have adequate insurance coverage in the event they get into an accident when their app is on, but they haven’t accepted a ride.”

“Mercury wants to ensure these individuals are able to earn an honest living without having to worry about paying costly repair or medical bills out-of-pocket—and we’ll be able to offer this peace of mind for as little as 20 cents a day,” Reeves adds.

Ride-hailing is divided into three phases:

  • Phase one: Drivers have turned on the ride-hailing app, but haven’t accepted a fare
  • Phase two: Drivers have accepted a fare and are on their way to pick up the passenger(s)
  • Phase three: Drivers are transporting passengers to their destinations

Mercury’s ride-hailing insurance will cover drivers during the first phase of their trip, the carrier explains. This coverage is not provided by personal auto policies and the TNCs provide very limited coverage during this phase, as well. Consequently, if drivers get into an accident during phase one, they will have to pay to repair any damages to their vehicles and the TNC liability coverage is capped at $50,000 per person and $100,000 per accident for injury to others. Mercury’s ride-hailing insurance is designed to provide additional coverage above and beyond the TNC coverage and also fix the insured’s vehicle in a covered loss if those coverages had been purchased from Mercury.

(Related: Allstate Offers Pay-Per-Use Roadside Assistance to Lyft Drivers)

“Mercury has been protecting drivers for more than 50 years. It’s what we do. So, we’re very excited to be one of the first companies to extend the coverage to ride-hailing drivers and protect not only them, but the drivers and families with which they come in contact on the road,” Reeves adds.

Anthony R. O’Donnell // Anthony O'Donnell is Executive Editor of Insurance Innovation Reporter. For nearly two decades, he has been an observer and commentator on the use of information technology in the insurance industry, following industry trends and writing about the use of IT across all sectors of the insurance industry. He can be reached at [email protected] or (503) 936-2803.

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