Do I Need a Separate Auto Insurance Policy if I’m Driving for Uber, Postmates, or Work?

By Kevin Quinn and the Mercury Team

The gig economy just keeps on growing. And while estimates are all over the map, a 2025 MBO Partners survey found that 72.9 million Americans identified as Independent workers. Regardless of numbers, however, if you’re delivering food for Postmates, ridesharing with Uber or Lyft, or driving for Instacart or Shipt, you might assume your personal auto insurance will keep you covered in the event of an accident. But that’s not typically the case. Most personal auto policies exclude driving for hire.

That’s where rideshare auto insurance comes in. At Mercury Insurance, we can help ensure you have the right amount of coverage for your gig work — even if it’s only part-time — along with the best insurance for rideshare drivers that will keep you protected on the road.

Does Personal Auto Insurance Cover Rideshare or Delivery Driving?

Most standard personal policies specifically exclude commercial driving. That means if you get into an accident while logged into the Uber app or delivering a pizza, your claim will likely be denied.

Your personal auto insurance policy is designed for private use, like commuting, road trips, and errands. So once you start using your vehicle to generate income, whether it’s transporting passengers or deliveries, your insurer will likely classify it as a business activity. Without rideshare insurance or a commercial auto policy, you risk paying for repair bills, medical expenses, and even liability lawsuits out of pocket.

“Rideshare drivers often have a gap in their insurance coverage that they may not know about,” said Kevin Quinn, VP, Auto Claims at Mercury Insurance. “A driver’s personal auto insurance has them covered while they’re driving for personal use – that is, with the ride-hailing app turned off.

“Companies like Uber or Lyft offer partial insurance to cover the driver and the driver’s vehicle once a fare is accepted and while they transport a passenger. This leaves a gap in between, when a driver has turned on their ride-hailing app to search for a fare, but before they have accepted a trip.”

What Is Rideshare Insurance, and How Does It Work?

Rideshare insurance is supplemental coverage that fills the gap between your personal auto policy and the limited protection offered by companies like Uber, Lyft, or Postmates. Company coverage usually begins only after you’ve accepted a ride or delivery, leaving you exposed while waiting for requests. A rideshare insurance add-on extends protection to those in-between periods and often also applies while you’re en route to pick up a passenger or make a delivery.

Because rideshare insurance is not offered by every provider, you’ll need to check with select insurers, like Mercury, that specifically offer this add-on protection.

Do You Need a Commercial Auto Policy for Work Driving?

Not every driver needs a full-blown business auto policy. For most rideshare or delivery drivers, rideshare auto insurance provides sufficient coverage. However, if you’re a contractor or business owner who uses vehicles regularly for work, then you may need commercial auto insurance. For instance, you’ll need it in these scenarios:

• You own a business and drive a branded car regularly used for your operations.
• You’re an employee or a contractor who uses your own vehicle to make work deliveries.
• You transport heavy equipment, tools, or deliver goods as part of your job.

What Are the Risks of Not Having the Right Coverage?

Answering the question, “Do I need rideshare insurance?” comes down to how much risk you’re willing to take. If you rely on your vehicle for income, skipping out on insurance as a delivery or rideshare driver can cost you big time if something happens while you’re working. You may have to deal with:

• Denied claims: If your insurer discovers you were driving for Uber or Postmates at the time of an accident, they may reject your claim entirely.
• Out-of-Pocket repairs: You may be on the hook for car repairs, medical costs, and vehicle replacement.
• Liability lawsuits: If another party is injured, you could face a lawsuit for damages and lost wages.

How Can You Choose the Right Policy for Your Situation?

Selecting the right coverage comes down to a few steps:

1. Evaluate how often you drive for work or gigs. The more hours you put in, the more essential additional coverage becomes.
2. Compare coverage types based on your situation. You’ll need rideshare insurance if you’re a gig worker who only drives for rideshare or delivery platforms. Commercial coverage is ideal for small business owners or employees using vehicles for non-rideshare work.
3. Work with an insurance agent to avoid coverage gaps. Experienced agents can explain coverage gaps and suggest either rideshare auto insurance or commercial options based on your situation.

Why Choose Mercury Insurance for Rideshare and Work Coverage?

For decades, Mercury Insurance has provided trusted support to gig workers and other professionals with affordable policies specially designed for rideshare and commercial situations. The benefits of our coverage options include:

• Flexible add-on coverage at a fraction of the cost of a full commercial policy.
• Protection during all driving phases, from waiting for a passenger to completing deliveries.
• Expert customer service teams familiar with gig driving needs.
• A balance of affordable policies with comprehensive protection.

Personal policies rarely cover rideshare or delivery driving. That’s why Mercury provides flexible policies designed for any gig worker. Don’t wait for an accident to discover the limits of your current plan. Get the best insurance for rideshare drivers today, and make sure your hustle stays safe on the road.