What is rideshare car insurance?

KATIE RODWELL
Finance Writer · 28 June 2021
Driving for Uber or another ridesharing company? It’s imperative that you consider car insurance, in case something goes wrong.

If you are thinking of becoming a driver for Uber, Ola or another ridesharing service, you may be wondering what type of car insurance you need to have in place to protect you, your vehicle and your passengers.

In addition to compulsory third party insurance (CTP), many rideshare companies will ask you to have a minimum of third party property damage insurance, while others might insist on you taking out full comprehensive cover.

Any injury to your passengers, as a result of an accident, might be covered under CTP, which you are legally required to purchase when registering your car. A ridesharing company may also offer its own insurance for drivers, which you could consider alongside any wider car insurance policies you have in place.

In this article, we cover:

What is rideshare insurance?

Rideshare car insurance is a relatively new car insurance product designed specifically with rideshare drivers’ needs in mind. It is very similar to a comprehensive car insurance policy but includes cover for when the car is being used to transport passengers using rideshare services such as Uber or Ola. Currently only a handful of insurance providers, including Carpeesh, GT Insurance and ShareCover, offer this as a standalone product.

If you are a rideshare driver and want to add this type of cover to your existing comprehensive or third party property policy, you can contact your current provider and find out more about options they may have available to consider. Many car insurance providers will want you to let them know beforehand if you plan to use your car for rideshare services. Not letting them know in advance could void your policy or lead to your claim being refused.

I’m thinking of becoming a rideshare driver – what type of car insurance do I need?

If you are thinking of becoming a rideshare driver for Uber, Ola, DiDi or another rideshare service, you may want to consider taking out third party property insurance at a minimum, in addition to compulsory CTP or Green Slip insurance.

Some rideshare services may require you to have full comprehensive cover, in which case you will be advised of this when you apply to become a driver.

Whether you have third party property or comprehensive car insurance cover, if it is not specific rideshare car insurance it is highly recommended to consider letting your insurer know you plan to use the vehicle for ridesharing before you start.

When you apply to become a driver for a rideshare service, you will generally be asked to provide evidence of the car insurance policies you hold for the vehicle you plan to use.

What does car insurance for rideshare drivers cover?

If you are a rideshare driver and have rideshare car insurance or compulsory car insurance that includes rideshare driving, these are likely to be the highest levels of cover available in Australia. Comprehensive car insurance may provide financial assistance to help pay for things like damage to other people’s vehicles and/or property, damage or loss of your vehicle caused by fire or theft, and damage caused to your vehicle in a traffic accident, regardless of who is at fault.

Depending on the insurer and policy you choose, there are also a range of optional extras you may be able to purchase, including a temporary replacement vehicle when your car is being repaired, and no-excess windscreen replacement. One of the benefits of a specific rideshare insurance policy can be the inclusion of a hire car, either as standard or as an optional extra, while your own car is being repaired. This could be helpful and mean you don’t miss out on any income, should your own vehicle need repairs or replacing after an accident or theft.

Will my current car insurance policy cover me if I start rideshare driving?

Many insurers are expanding their car insurance policies to accommodate drivers who are signed up to Uber and other ridesharing services, although it may lead to higher premiums in some cases. Previously, it was more common for car insurers to state that cover would not be available if you used your car to carry passengers for monetary gain as part of the terms and conditions of their policies.

That said, some car insurance providers may still have a clause that says something to this effect in their car insurance policies, including some who may only offer ridesharing cover on comprehensive policies. So, it’s important to let your insurer know if you intend to start driving for a rideshare service, so they can consider adjusting your policy accordingly.

Do I have to tell my insurer I am a rideshare driver?

Yes, generally speaking it’s a good idea to let your insurer know if you plan to use your car for rideshare driving. Many policies have traditionally excluded cover for a driver and/or vehicle if that vehicle is being used to carry passengers for monetary gain.

This is changing. Today, some policies now automatically include cover for rideshare driving. However, to avoid any potential problems should you need to make a claim, it’s important to make sure your car insurance provider knows if you are using a car to carry rideshare passengers. If you don’t tell your insurer and you need to make a claim, they may refuse to cover it.

Are my passengers covered by rideshare car insurance?

Rideshare car insurance that you take out as a driver will generally not cover injury to your passengers. However, your CTP insurance may provide financial assistance to cover any medical or liability costs if your passengers are hurt in a car accident where you are at fault. In addition, some ridesharing companies may have their own insurance arrangements in place to cover injuries to passengers.

You may like to speak with your insurer and ridesharing service directly if you have any questions about what is, or isn’t, included in your current car insurance cover. You can also compare general comprehensive car insurance options with Canstar.

Do ridesharing services such as Uber offer car insurance to their drivers?

Some rideshare services also offer additional liability cover that exists alongside your own car insurance policies. Uber, for example, offers its drivers a support package that includes personal injury cover and financial assistance, should you be unable to work following an accident.

While some rideshare services offer liability insurance cover to their drivers, it’s important to remember that this does not replace CTP or Green Slip insurance, third party property damage, third party fire and theft, or comprehensive car insurance.

Prior to signing up as a rideshare driver, you are likely to be asked to provide evidence of having certain car insurance policies in place (such as CTP or Green Slip insurance, which is compulsory when you register a car in Australia). You’ll likely have the option of adding additional liability cover, if the ridesharing service offers this.

What car insurance is required to drive with Uber or other ridesharing services?

Here are the car insurance requirements and options offered by some ridesharing services in Australia, at the time of writing:

Rideshare service car insurance needs

DiDi

GoCatch

Ola

Shebah

Uber

DiDi

What car insurance is required by DiDi?

You must provide evidence of your vehicle registration and CTP insurance for the state or territory you live in and have a minimum of third party property damage insurance cover. DiDi asks that you disclose that your vehicle is appropriately insured. You’ll need to be listed as an insured driver, whether you have a current third party property or comprehensive insurance cover, in addition to CTP or Green Slip insurance.

What additional car insurance does DiDi offer?

DiDi offers its drivers a discount on a comprehensive car insurance policy provided by ShareCover. DiDi also offers other discounted services for drivers.

GoCatch

What car insurance is required by GoCatch?

You must provide evidence of your vehicle registration and CTP insurance for the state or territory you live in and have a minimum of third party property (fire and theft) insurance cover. You must be listed as the policy holder or nominated driver, and your car must be insured under a ‘rideshare condition’. GoCatch asks prospective drivers to provide a copy of their valid insurance certificate, which is often called a Certificate of Currency or a Certificate of Insurance.

What additional car insurance does GoCatch offer?

GoCatch offers an umbrella insurance policy for any liability arising from third party bodily injury or property in the event that the driver’s personal CTP and comprehensive car insurance doesn’t cover these two things.

Ola

What car insurance is required by Ola?

You must provide evidence of your vehicle registration and CTP insurance for the state or territory you live in and have a minimum of third party property damage insurance cover. If you are driving with Ola using a rental car, you’ll also need to share a valid rental agreement that outlines what insurance is being covered by the rental provider that meets Ola’s requirements.

What additional car insurance does Ola offer?

At the time of writing, Ola drivers must obtain their own personal accident cover to financially protect against any injury sustained following an accident.

Shebah

What car insurance is required by Shebah?

Shebah drivers are required to have full comprehensive car insurance, along with vehicle registration and CTP for the state or territory they live in. You’ll need to mention to your insurer that you plan to use your car for ‘ridesharing purposes’.

What additional car insurance does Shebah offer?

None at the time of writing.

Uber

What car insurance is required by Uber?

Your car must be road registered and insured for CTP in your state or territory of residence. Your vehicle must also be insured for a minimum of third party property damage, with you (as the ‘driver’) listed as either the policy holder or a named insured driver.

What additional car insurance does Uber offer?

Uber has a support package for both eligible drivers and delivery partners while they are using the app. Under this package, Uber automatically provides insurance covers eligible drivers with insurance for certain accidental injuries that arise from an on-trip accident. This includes lump sum payments for certain common injuries (such as broken bones), permanent disability and accidental death compensation, and reimbursement or lump sum benefits in certain events, such as hospitalisation or assault. This insurance is provided free of charge. Terms, conditions and additional eligibility criteria may apply.

Can you claim car insurance on your tax return if you are a rideshare driver?

You should generally be able to claim at least some of your car insurance premiums as a deduction in your tax return, alongside all your other business expenses including fuel and the costs to maintain your vehicle. According to the Australian Taxation Office (ATO), expenses for rideshare drivers can sometimes be part business and part private use, and you can only claim a deduction for the business portion of your costs. You will also need to show how you calculated the business and private use components of your expenses.

Keep in mind, too, that there’s a tax-free threshold in Australia, with different tax brackets based on what you earn.

Does rideshare insurance cover the private use of your car?

Yes, rideshare car insurance, such as the Rideshare Cover provided by Carpeesh and ShareCover’s RideCover Comprehensive product, will often cover you when you are driving the same car for private purposes.

Final thoughts

In addition to car insurance, keep in mind that there are wider factors to think about if you are considering becoming a rideshare driver. You can visit the websites of ridesharing service providers you are thinking of signing up with for further details about driver eligibility requirements.

If you are looking for a different way to make money, there are different side hustles that may appeal, plus money-making apps and ways you could even make money from home. If you’d like to become a rideshare driver and want to buy a car, Canstar has information to help you with comparing car loans, plus tips about how much you can borrow for a car loan.

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