I remember giving my friends a ride to class, or a friend’s mom driving me to gymnastics. Those forms of ridesharing have been going on for years and the insurance company refers to them as “share the expense carpools”. These carpools do NOT usually pose a risk to your insurance coverage. However, controversy has been circling around more recent ridesharing programs popping up around the country and prevalent in Rhode Island. Technology has changed the way people not only communicate, but hitch a ride to their dentist appointment. All you will need is a smart phone, an app, and within minutes a car will soon pull up to your feet!
Ridesharing programs include such companies as Lyft, UberX, and Sidecar. You can go online, call, or use a smartphone app to request a ride with one of these companies. In turn, they contact a local non-professional driver who has registered with them ahead of time and arrange for you to be picked up and brought to your destination using the driver’s own personal vehicle. Are you a ride share driver or looking to become one? You might think this is a great way to get some extra cash in your back pocket. However, your current auto policy is lacking specific coverage for both you (the driver) and your passengers. This same limitation applies to others using their vehicle for delivery purposes, such as local pizza delivery.
Before considering taking the delivery job from the local pizza parlor, or becoming a Lyft driver, look over your current car insurance policy. If you are using your personal car for business purposes (like those mentioned) there are policy exclusions involving liability coverage that you should be aware of.
A personal auto insurance RI policy, as opposed to a commercial auto insurance policy, does not provide liability coverage if you are driving for hire or as your policy refers to as, “using your vehicle for public or livery conveyance”. The term driving for hire includes delivery services such as pizza delivery, or accepting money to transport people with your personal vehicle. You will not be covered if you are driving your personal car and cause injury or damage to someone else while performing business obligations. Can you afford to have injured passengers sue you because they paid for a ride, you got into an accident, and now they’re hurt? Can you afford to hit someone’s house or car when you pull up to deliver their pizza and have to cover the expense of the repairs, without the help of your RI insurance?
In order to protect yourself before you cause injury or damage to someone else, you will need to consider purchasing a commercial auto policy. In Rhode Island, for hire transportation services are regulated by the Division of Public Utilities and Carriers (DPUC). Individuals who intend to offer for hire transportation services must be licensed by the DPUC and maintain a minimum of $1.5 million commercial liability insurance, and obtain a special Hackney Operator’s Licenses issued by the DPUC prior to transporting passengers. These services will need to bear a “Public Registration License Plate.”
Before accepting any job offer involving your own car, make sure you check, double check, and triple check your current policy. Call us and we will gladly check it for you! You might think you will be able to make a few extra dollars, but commercial liability coverage can be more expensive then personal auto insurance so you should understand those expenses before signing up for the job.
If you still aren’t sure what direction to go, contact Loiselle Insurance Agency. We would be more than happy to review your policy and let you know whether or not driving your vehicle for work will pose a problem with your specific auto policy. If you need business auto coverage for commercial liability, we can help you with that too! Call us today at (401) 723-8510.