Farmers has received approval to offer new insurance product in California
Farmers Insurance Group has launched a new auto insurance product in California, with the approval of the state’s insurance regulators. Now, drivers that work for rideshare companies like Uber and Lyft will be able to obtain more coverage, protecting them from potential worst-case scenarios. The coverage is designed to address gaps in the coverage that these companies provide, though both Uber and Lyft claim that such gaps do not exist. Both companies have received some criticism for what is perceived as dubious insurance practices by state officials.
Policy will provide drivers with better coverage
The product, called “Rideshare Endorsement,” is the first of its kind to be offered in California by a major insurance company. The policy has an 8% surcharge, which is collected by the state. Rideshare Endorsement policies will extend existing auto insurance coverage and apply what the state considers to be “period one,” provisions. Period one refers to the period between when a rideshare driver signed into their rideshare application and the time that they are matched with a passenger.
Other insurance companies may follow Farmers in providing better coverage
Insurance Commissioner Dave Jones believes that other insurance companies in the state may follow the example set by Farmers. Rideshare companies have offered auto insurance coverage to their drivers for years, but this coverage does not typically begin until they are transporting a customer. This means that drivers must use their own auto insurance policies before they are transporting a passenger, even though they are working for a company that provides coverage.
Rideshare companies have received a significant degree of attention from lawmakers in many parts of the country. There have been concerns that these companies are not providing appropriate levels of insurance coverage to their drivers, leaving gaps in coverage that expose drivers to significant risks. Companies like Farmers can help solve this issue, providing both rideshare organizations and their drivers with the insurance coverage that they need.