View source for Definition:Ride-sharing

🚗 '''Ride-sharing''' refers to transportation services — such as those provided by Uber, Lyft, and similar platforms — in which drivers use personal vehicles to carry passengers for hire, creating a hybrid risk profile that has disrupted traditional [[Definition:Personal auto insurance | personal auto]] and [[Definition:Commercial auto insurance | commercial auto]] insurance models. Because drivers toggle between personal use and commercial activity, standard [[Definition:Insurance policy | insurance policies]] historically left dangerous coverage gaps: a personal auto policy typically excludes commercial livery, while a full commercial policy is impractical for someone who drives for a platform only a few hours a week.

🔀 The industry responded by developing specialized [[Definition:Ride-sharing insurance | ride-sharing insurance]] products structured around the distinct "periods" of a driver's activity. Period 1 covers the time the driver's app is on but no ride has been matched; Period 2 begins when a ride request is accepted and the driver is en route to the passenger; Period 3 spans the actual trip with the passenger in the vehicle. [[Definition:Transportation network company (TNC) | Transportation network companies]] typically carry [[Definition:Commercial liability insurance | commercial liability]] coverage for Periods 2 and 3, while Period 1 often falls to the driver's personal [[Definition:Endorsement | endorsement]] or a gap product offered by [[Definition:Insurance carrier | carriers]]. Several insurers and [[Definition:Insurtech | insurtechs]] have built [[Definition:Usage-based insurance (UBI) | usage-based]] or [[Definition:Pay-per-mile insurance | pay-per-mile]] products that dynamically adjust [[Definition:Premium | premiums]] based on real-time driving data and activity status, reflecting the fluid nature of ride-sharing exposure.

📌 Ride-sharing's rapid growth forced regulators across dozens of U.S. states and international jurisdictions to enact new [[Definition:Insurance regulation | insurance requirements]] specific to [[Definition:Transportation network company (TNC) | TNCs]], establishing minimum [[Definition:Liability limit | liability limits]] for each period and clarifying which party bears [[Definition:Primary coverage | primary coverage]] responsibility. For the insurance industry, this category of risk represents both a challenge and an opportunity: the sheer volume of drivers creates a large, data-rich [[Definition:Risk pool | risk pool]] ideally suited to [[Definition:Telematics | telematics]]-driven pricing and [[Definition:Artificial intelligence | AI]]-powered [[Definition:Underwriting | underwriting]]. Carriers that have moved quickly to offer tailored ride-sharing products have gained access to a growing gig-economy demographic, while those slow to adapt face [[Definition:Adverse selection | adverse selection]] as drivers with inadequate coverage migrate toward more flexible options.

'''Related concepts'''
{{Div col|colwidth=20em}}
* [[Definition:Usage-based insurance (UBI)]]
* [[Definition:Commercial auto insurance]]
* [[Definition:Telematics]]
* [[Definition:Transportation network company (TNC)]]
* [[Definition:Gig economy insurance]]
* [[Definition:Personal auto insurance]]
{{Div col end}}