Arizona’s Insurance Laws on Coverage for Rideshare Drivers

Arizona's rideshare industry has seen significant growth over the past few years, with companies like Uber and Lyft reshaping how people get from point A to point B. However, this rise in ridesharing has also raised important questions regarding insurance coverage for drivers. Understanding Arizona’s insurance laws and what they mean for rideshare drivers is crucial for both safety and financial protection.

In Arizona, rideshare drivers are classified as independent contractors, which means they are responsible for their own insurance coverage while driving for a rideshare company. However, rideshare companies provide additional coverage for drivers, which is activated when they are logged into the ridesharing app and have accepted a ride request.

Arizona law requires all drivers to maintain a minimum level of personal auto insurance coverage. This includes:

• $15,000 for injury or death of one person in an accident.
• $30,000 for injury or death of multiple people in an accident.
• $10,000 for property damage in an accident.

However, personal auto insurance policies often have exclusions that may nullify coverage when a driver is using their vehicle for commercial purposes, such as providing rides for strangers. For this reason, rideshare drivers need to understand how their personal and rideshare insurance work together.

The two main phases of rideshare driving offer different levels of insurance coverage:

1. Period 1: This phase begins when the driver is logged into the app and waiting for a ride request. During this time, the rideshare company provides liability coverage of up to $50,000 for bodily injury per person, $100,000 for bodily injury per incident, and $25,000 for property damage.
2. Period 2: This begins once a driver has accepted a ride request and lasts until the passenger has been dropped off at their destination. In this phase, the rideshare company usually provides up to $1 million in coverage for both injury and property damage.

It is crucial for Arizona rideshare drivers to supplement their coverage by purchasing rideshare insurance. Rideshare insurance policies are designed to fill in the gaps between personal auto insurance and the coverage provided by rideshare companies. These policies can offer:

• Extended liability limits.
• Comprehensive and collision coverage while on a rideshare trip.
• Protection during the waiting period (Period 1).

Moreover, drivers should ensure their personal auto insurance policy allows for ridesharing activities. Some insurers may offer specific endorsements that tailor the coverage to rideshare operations, which could save drivers from potential legal and financial risks.

Failing to understand Arizona's insurance laws could lead to severe consequences. If an accident occurs while driving for a rideshare service without appropriate coverage, drivers may face denial of claims or even lawsuits for damages. Therefore, educating oneself about the intersection of personal and rideshare insurance is a necessity for drivers in Arizona.

In summary, Arizona's insurance laws require rideshare drivers to carry minimum coverage while also necessitating additional measures to ensure they are adequately protected. By understanding the various phases of coverage and considering supplemental insurance options, rideshare drivers can safeguard themselves against potential liabilities.