The bottom line is that a lot of people are paying are too much for auto insurance out there. Such vast differences in premiums would not exist if insurers knew they couldn’t get away with them.
Lots of people who need extra cash see these apps as a good way to make money by using something they already have, their car. Unfortunately, there are some serious potential problems with ride-sharing apps that their fans are ignoring.
The insurer can raise the premium of or even cancel one of the policies without affecting the other. A person with a bundled car and home policy might see her auto insurance payment go up after an accident, while her homeowner’s premium stays the same.
If you are riding one on the public road and a car swerves to avoid you and gets into an accident you could be held liable. If you don’t have insurance the driver or her insurance company could come after your salary, your property or your bank accounts.
It is hard for some people to believe, but you may still have to buy car insurance, even if you don’t own a vehicle. The reason for this is that a driver can be held liable for an accident, even if he or she doesn’t own the vehicle he or she is driving. That means you can be sued over an accident you get into driving a car you don’t own.
The best way to think of an insurance broker is as a matchmaker who tries to arrange a relationship between a customer and an insurance company. The broker does not work for the company or represent it, although he or she does receive a commission from the insurer for referring a customer to it.
If that wasn’t bad enough, the insurance coverage provided by Uber or Lyft only pays for medical costs for passengers or persons injured in an accident, such as another driver. The driver of the Lyft car might end up having to pay his or her own medical costs if he or she is injured.