Rideshare companies such as Uber and Lyft allow us to hire a personal driver on short notice by downloading a computer application (app) on our smartphone, entering our personal information (name, phone number, email address, credit card number) and connecting to a network of vetted drivers.

Laws vary from state to state but most states regulate rideshares and some states require rideshare drivers to have more insurance than other drivers—greater policy limits for personal injuries and property damage, for example.

Because a rideshare driver’s personal insurance policy may not cover an accident that occurs when the driver is providing a rideshare service, some insurance companies offer rideshare drivers a ridesharing endorsement—which is an addition to the rideshare driver’s personal insurance policy and may cover personal injuries and property damage sustained during a rideshare. A ridesharing endorsement usually costs less than a commercial insurance policy.

Companies such as Uber and Lyft may also provide their drivers with some insurance—but it usually has significant restrictions and may require the driver to first make a claim on the driver’s personal insurance policy.

If a rideshare driver involved in an accident does not have a ridesharing endorsement on the driver’s personal policy—and does not have a commercial policy—the driver’s insurance claim will likely be denied if the accident happened during a rideshare. In that case, the insurer may also cancel the driver’s policy for violating the policy term that the vehicle only be used for personal purposes and not for commercial (rideshare) purposes.

If a rideshare driver involved in an accident does have a ridesharing endorsement, the driver’s insurance will be “primary” and the rideshare company’s insurance will be “excess”—meaning it will only be available or “tapped” if the covered personal injuries and property damage exceed the limits of the driver’s insurance policy.

In South Carolina, rideshare companies like Uber and Lyft are subject to state regulations that include requirements for driver insurance coverage. While specific insurance requirements can vary, South Carolina generally mandates that rideshare drivers carry higher insurance policy limits than typical drivers to cover personal injuries and property damage. This is to ensure that there is adequate coverage in the event of an accident while providing rideshare services. Rideshare drivers' personal insurance policies may not cover incidents that occur during commercial operation, prompting some insurance providers to offer ridesharing endorsements. These endorsements extend the personal insurance policy to cover rideshare activities, often at a lower cost than commercial insurance policies. Rideshare companies themselves usually provide some level of insurance for their drivers, but this coverage often comes with limitations and typically requires the driver to first file a claim with their personal insurance. If a rideshare driver does not have a ridesharing endorsement or a commercial policy and is involved in an accident while on a rideshare, their personal insurance claim may be denied, and their policy could be canceled for breach of contract. Conversely, if a driver has a ridesharing endorsement, their personal insurance serves as the primary coverage, with the rideshare company's insurance acting as secondary or 'excess' coverage, which only comes into play if claims exceed the driver's personal policy limits.