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Everything you need to know about rideshare car insurance
Using your car to earn some extra money via ridesharing is growing in popularity, with companies like Uber, Ola, DiDi, and more coming into the market. If you want to be a rideshare driver for one of these companies, car insurance for ride-sharing is essential.
You’ll already have compulsory third-party (CTP) insurance as it’s required in Australia at the time of registering your car. You may also have additional coverage for your car, such as comprehensive or other third-party insurance. Rideshare companies may ask you to get a third-party property damage (TPPD) insurance policy if you’re not already covered for what it covers.
Whatever level of car insurance coverage you choose to take out, you need to ensure you tell your insurer that you’re using the car for rideshare. If you fail to inform your insurer, they may cancel your policy or refuse to cover any claims you make.
What type of insurance is needed for Uber, Ola and other rideshare companies?
A basic CTP policy and registration are standard requirements for any car in Australia. A TPPD insurance policy that mentions you’re the driver is also required to drive for Uber, Ola, and most of the other rideshare companies. These companies will often ask you to take out a TPPD insurance policy in case of an accident.
If you’re responsible for a car accident, the TPPD insurance will cover damages that your vehicle causes to other people’s cars and property. However, it won’t cover damage to your vehicle or any physical injuries of anyone involved in the accident. CTP insurance will cover any injuries to other parties in the accident, but you may opt for comprehensive car insurance for better protection.
Comprehensive car insurance is the highest level of cover you can get and covers your vehicle, the other car, property, and complete treatment for injuries. It also includes support in case of robbery, and some insurance plans also offer towing and other facilities.
You may sometimes get additional insurance from ridesharing companies, but that does not mean you should discontinue your own policies.
Although specific car insurance policies for rideshare are still relatively new and only offered by a handful of insurers, many other insurers offer it as an optional extra.
To get rideshare car insurance quotes, you’ll need to compare insurance quotes from multiple insurers that offer rideshare coverage as part of their policies. You’ll need to do some research to determine which companies offer this as part of their policies and which level of cover they offer it.
Most insurers won’t offer this cover as standard in any of their insurance policies. You’ll need to inform them of your plan to use the care for this purpose, and they can assist you in adjusting your policy. However, with the growing popularity of using personal cars for ridesharing or food delivery, many insurers are expanding policies to include these as options. Be sure to check the Product Disclosure Statement (PDS) or speak to your insurer to check your policy details.
How does rideshare work, and why do you need insurance?
Ridesharing is considered “ferrying passengers for profit”, which has long been excluded from any standard car insurance policy. This descriptor accurately describes what ridesharing is because you are carrying passengers in your car for a fee or profit. As you’re carrying multiple passengers under different circumstances and often in unfamiliar places, ensuring you’re fully covered if the worst happens will protect you and your passengers.
Insurance policies that include rideshare cover will often cover a wide range of car accidents and possible damage scenarios. It means you’ll be compensated for damage to your vehicle, any damage to the other party’s vehicle and property, and also for fire or theft issues.
You may also get financial aid for a temporary vehicle if required to ensure you can continue to make money. It’s a good idea to speak with your insurer and rideshare service company regarding the compensation for the passengers.
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Product database updated 04 May, 2024
