Fact Check

Fact Check: Will Houston rideshare drivers need commercial insurance?

In a Facebook post, Michael Clayton posted that Uber driver are now required to have a commercial insurance policy of $1MM. So is this true? Do you need to be worried about this?

The first thing we need to look at is that the source is his Farmers Insurance Agent.

Fun Fact: Insurance agents get paid via commission. Therefore, the more you pay the insurance company, the more your agent gets paid.

So is it possible this Farmers Agent is just trying to up sell him? This is very likely. It could also be that Farmers Insurance, as a company, has decided that rideshare drivers are high risk drivers (the more you drive, the more you increase your chance of getting into an accident, whether that is your fault or not.) We have seen in the past where insurance companies have stopped insurance rideshare drivers. This is not anything new.


Uber and Lyft already provide commercial insurance.

Remember, Uber and Lyft and any other rideshare company that is licensed to do business as a TNC in Texas provides this same $1MM policy in accordance with HB100. Therefore, if you have a rider you are already provided with a commercial, $1MM policy.

However, you should be aware that this $1MM policy does not cover you when you are simply on the app. Most insurance companies offer a rideshare endorsement, which serves as a type of gap insurance for when the rideshare company does not cover you. If you have not already done so, it is imperative that you let your insurance company know you are driving for Uber and/or Lyft and ask if they have a rideshare product to cover you. Personally, I use USAA and it is less than $10 a month. It really does not cover much, but it does ensure you are taken care of in the event there is an accident. If your insurance company is not aware you drive for Uber and Lyft, you run the risk of not being covered. Yes, your company (like Michael’s Farmers agent) may not offer it and will threaten to drop you unless you buy their full blown commercial policy, but all this simply means is you should shop around for one that appreciates your business.


So, will drivers need separate commercial insurance or not?

The claim that rideshare drivers need to have a separate commercial insurance policy is FALSE. Uber and Lyft already provide this commercial insurance for drivers, as required by state legislation.

It should be noted though, that Farmers does have a Rideshare Product that is NOT full blown commercial insurance. Sometimes this varies by state, but we are leaning towards Michael’s Insurance Agent is just trying to simply increase his paycheck.

Now we have to include this post as well:


There is no source attached to this post. This is simply a scare tactic to get other drivers to stop driving, which is not cool at all.

Yes, we left his picture on these screenshots. Some may not agree but the thing is, Michael is purposely spreading false information. This is an account you need to block. He often posts “hotspots” and he has been spotted in another part of town. The reason why we have not posted about him before this, is because we never caught him red handed misleading drivers, until now.


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