Farmers Rideshare Coverage Is Now In Arizona!
Farmers Insurance: the first to offer rideshare insurance coverage in Arizona!
Farmers Insurance has stepped up to the plate and begun offering rideshare coverage to Uber and Lyft drivers in Arizona. Now you don’t have to cross your fingers and hope that you don’t have an accident when you login to your Uber app. Farmers Insurance has your back!
The History of Rideshare in Arizona.
In the early years, rideshare companies like Uber and Lyft grew rapidly in Arizona. More and more people began to realize how affordable and convenient it was to request a ride from their smart phone. And drivers began realizing how easy it was to make a part time income and have a great time meeting new people.
But the paradise of ridesharing was always darkened by a cloud of… is it legal? Is it covered by my auto insurance? These were valid concerns, because there always was a question about “who is covering what” and “are folks driving around uninsured?” In many cases, and at certain times in the rideshare experience, drivers were indeed uninsured.
All that changed recently. First, in Arizona, under a bill signed into law by Governor Doug Ducey on April 9, 2015, “Transportation Network Companies” (or TNCs) came out of the shadows and were recognized as important parts of Arizona’s economy. The bill, among other things, required companies like Uber and Lyft to provide minimum liability coverage from the moment the driver’s app was turned on. That solved the legal problem of being uninsured.
The bill also paved the way for insurance companies to offer a solution to another major problem, that of being under-insured. So Farmers Insurance jumped at that opportunity, and almost immediately announced that they would offer an endorsement to their auto policy that would fill in the gaps left by the minimum coverage provided by rideshare companies in Period 1.
The Arizona Rideshare Period 1 Problem
Uber and Lyft have complied with state law, and currently cover minimum liability limits that exceed (by a little bit) Arizona state requirements for transportation network companies. The requirement in Arizona House Bill 2135 is 25/50/20 (shown here on page 21). Ridesharing is legal now.
So what’s this “Period 1” problem?
Period 1 is when the rideshare driver is logged into the app, waiting to be matched to a ride, but has not yet been matched to a rider. Uber and Lyft cover LIABILITY ONLY during this period. And again, the liability is at very low minimums. (For instance, Uber is 50/100/25.)
There is NO COVERAGE for damage to your vehicle if you are declared to be at fault.
Sometimes a picture is worth a thousand words:
Farmers Insurance Extends Coverage In Period 1.
Farmers solved this gap in coverage by offering an endorsement to your existing personal auto policy, which extends your personal auto insurance coverage into Period 1… all the way up until you’ve been matched with a rider, and the rideshare company’s full coverage kicks in.
(But you should be aware that there are some higher deductibles and qualifications on Lyft and Uber policies during Periods 2 and 3, and no other insurance carrier at this time has coverage that covers you during those two periods. So read your Uber and Lyft policies carefully.)
In short, this means:
If you choose to purchase the optional Rideshare Coverage Endorsement, Farmers covers you during Period 1 (the time when you are waiting to be matched to a rider) with the same coverage levels that you currently have on your personal auto policy… including comprehensive and collision!
Now, we know that some people like specifics. Here’s some: the specific way that Farmers Insurance offers this coverage is through an endorsement written on a new personal auto policy. The policy is still through Farmers insurance, and the endorsement is called the “Optional Rideshare Coverage Endorsement “ and right now, as of the writing of this post on January 19, 2016, it is numbered (J6929–1st Edition). It is estimated to increase your auto premium by a percentage, and we are still working out what the average increase will be as we provide insurance quotes for our Chandler Arizona and Phoenix area friends.
The specific language (again, as of January 19, 2016) includes this description:
”Optional Rideshare Coverage means an extension of those coverages displayed on your Declarations Page during the time period commencing when you and your car are available to receive requests for transportation through a digital network or similar connection used by a transportation network company, and ending when you and your car are engaged in a prearranged ride…. Prearranged Ride means a period of time that begins when a driver accepts a transportation request through a digital network or similar connection and continues while the driver transports the rider in a personal car, and ends when the rider departs from the personal car.”
Yeah. We know. That’s a lot of “insurance-ese” talk. Call us and we can make it simpler.
You should give us a call. We are an experienced Farmers Insurance agency in Chandler, and we’ve been insuring our neighbors for over 26 years. This product may be new, but we aren’t.
Our agency staff is friendly, and we know rideshare drivers personally. We’re fans of this great service, and we want to help make sure everyone is covered while driving.
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Originally published at www.joesinsuranceplace.com.