Farmers Insurance said it will launch a coverage endorsement in Colorado for ridesharing insurance, a week after USAA announced a similar program for the state.
Like USAA, Farmers said its coverage endorsement is designed to address a June 2014 Colorado law authorizing ridesharing services.
The measure kicked in on Jan. 15, and it requires rideshare drivers to keep insurance coverage for the period when they turn on their ridesharing apps until they are matched with a passenger. Farmers’ coverage ends once a ride is accepted and when paying passengers are in the car.
Farmers said the coverage starts Feb. 16, and will be offered to both new and existing coverage. As designed, the rideshare coverage endorsement will also add an average 25 percent to a customer’s premium.
Farmers is touting itself as “being among the first to create a personal auto insurance offering tailored to ridesharing drivers.”
Ridesharing companies such as Lyft, Sidecar and UberX have become increasingly popular, competing with traditional taxis by offering one-time shared rides over a short distance.
Earlier in January, USAA announced it would test auto insurance coverage in Chicago designed to protect ridesharing drivers during the period the Farmers Insurance policy will. USAA said it wanted to pilot the coverage in Colorado, in part because of the Colorado law, which is the first state in the nation to pass this kind of legislation. Another reason: Colorado has a large number of USAA members.
Source: Farmers Insurance