Written and edited by Allison Anderson, based on an interview with Brian Chacker, partner at Gay Chacker & Ginsburg.
A Philadelphia resident takes an Uber home after work. Another driver runs a red light and slams into the vehicle. The injuries are serious. The Uber driver did nothing wrong. But the driver who caused the crash carries only Pennsylvania's minimum insurance coverage.
The passenger assumes Uber's $1 million insurance policy will cover the difference. It won't.
"That's the situation people don't expect," says Brian Chacker, a partner at Gay Chacker & Ginsburg in Philadelphia. "They assume Uber or Lyft has insurance that protects them no matter what. In Pennsylvania and New Jersey, that's simply not true."
Millions of people across Pennsylvania and New Jersey rely on Uber, Lyft, and other rideshare services every day. Many don't own a car and assume they're protected if something goes wrong. But a little-known gap in Pennsylvania and New Jersey law can leave injured passengers with far less insurance coverage than they expect.
Where the Coverage Ends and the Gap Begins
Most people have heard that Uber and Lyft carry a $1 million insurance policy while a passenger is in the vehicle. That part is true.
The misunderstanding is what that policy actually covers.
Rideshare companies provide different levels of insurance depending on what the driver was doing when the accident occurred. If the driver wasn't using the app, only the driver's personal auto insurance generally applies. If the driver was waiting for a ride request, the rideshare company provides limited liability coverage. Once a ride has been accepted and a passenger is in the vehicle, rideshare companies generally provide up to $1 million in liability coverage.
That sounds reassuring, until you look at what that coverage actually does and doesn't include.
Liability coverage protects passengers when the rideshare driver causes the crash. But if another driver causes the accident and doesn't carry enough insurance, Pennsylvania and New Jersey law does not require rideshare companies to provide uninsured motorist (UM) or underinsured motorist (UIM) coverage to fill the gap.
"In Pennsylvania and New Jersey, rideshare companies are not required to carry uninsured or underinsured motorist coverage," Chacker explains. "So if you're a passenger and the car you're riding in gets hit by someone who doesn't have enough insurance, or has no insurance at all, there may be little or no insurance available to fully compensate you."
"Years ago there were legal arguments you could sometimes explore," Chacker says. "Over time, those avenues have largely disappeared. If this is going to change, it will probably require lawmakers to require these companies to provide UM and UIM coverage in Pennsylvania and New Jersey."
Why This Matters More in Philadelphia Than Almost Anywhere
Few major cities rely on rideshare transportation as heavily as Philadelphia. According to U.S. Census data, roughly one in three Philadelphia households does not own a vehicle. For many residents, Uber and Lyft aren't occasional conveniences. They're how people get to work, medical appointments, the airport, and home safely at night.
Unfortunately, the problem doesn't end with rideshare coverage. Pennsylvania still has thousands of uninsured and underinsured drivers on its roads. The Insurance Research Council estimates that approximately 8% of Pennsylvania drivers are uninsured, and many more carry only the state's minimum liability limits of $15,000 per person. When a rideshare passenger is injured by one of these drivers, the rideshare company's policy provides no backup uninsured or underinsured motorist (UM/UIM) coverage in Pennsylvania or New Jersey.
The result: the people who depend most on rideshare, those who can least afford a car, are the most exposed when something goes wrong.
The Solution Most People in Pennsylvania and New Jersey Don't Know Exists
There is a safeguard, but almost nobody knows about it.
"It's called named non-owner insurance, or non-owner car insurance," Chacker says. "If you don't own a car, and a lot of people in Philadelphia don't, you can buy a policy in Pennsylvania or New Jersey that covers you when you're a passenger, when you're borrowing a friend's car, when you're in a rental. If the person who hits you doesn't have enough coverage, your own policy kicks in."
Here's why non-owner insurance is worth considering:
Available even if you don't own a vehicle
May provide UM/UIM protection while riding in Uber or Lyft
Can also apply in borrowed vehicles and rental cars
Helps fill a coverage gap many passengers don't realize exists
"Most people have never heard of non-owner insurance," Chacker says. "But for anyone who regularly uses Uber or Lyft as their way of getting around in Pennsylvania or New Jersey, it's one of the most important things they can look into. It exists specifically to fill the gap that these companies leave open."
What Non-Owner Insurance Typically Costs
Non-owner car insurance is typically one of the most affordable auto policies available. According to industry estimates, policies in Pennsylvania average between $200 and $500 per year, depending on coverage limits, driving history, and location. That works out to roughly $17 to $42 per month.
Major insurers including Progressive, GEICO, State Farm, and Nationwide offer non-owner policies in Pennsylvania and New Jersey. You can typically get a quote online in minutes.
For comparison: a single Uber ride in Philadelphia averages $15 to $25. The annual cost of non-owner insurance can be less than a month's worth of rides.
When Insurance Isn't Enough
Without non-owner insurance, an injured rideshare passenger in Pennsylvania or New Jersey who is hit by an uninsured or underinsured driver may face a stark reality: no path to compensation.
"We have clients in Pennsylvania who have no way to recover," Chacker says. "They used the rideshare as their primary form of transportation. They assumed the company would protect them if something happened. And now they're injured, and there's nothing we can do."
This isn't a rare scenario. The coverage gap affects Uber, Lyft, DoorDash, Grubhub, Caviar, and every other gig economy driving service operating in Pennsylvania and New Jersey. It does not necessarily apply in every state; some states require rideshare companies to carry UM/UIM coverage. But in PA and NJ, the requirement does not exist.
"We've had clients who did everything right," Chacker says. "They wore their seatbelt. They weren't driving. They weren't at fault. They simply assumed the rideshare company had enough insurance. Finding out after the accident that there wasn't enough coverage is an incredibly difficult conversation."
Understanding Uninsured and Underinsured Motorist Coverage
Two types of coverage are relevant here:
Uninsured Motorist (UM) coverage protects you when the at-fault driver has no insurance at all. This includes hit-and-run accidents where the driver is never identified.
Underinsured Motorist (UIM) coverage protects you when the at-fault driver has some insurance, but not enough to cover your injuries. For example, if your medical bills are $100,000 and the at-fault driver only has a $15,000 policy (Pennsylvania's minimum), UIM coverage bridges the gap.
Pennsylvania also offers "stacking," which allows drivers with multiple vehicles on a policy to multiply their UM/UIM limits. If you own a car with stacked coverage, that protection may follow you into a rideshare. For people who don't own a vehicle, a non-owner policy may provide an important source of UM/UIM protection that otherwise may not be available.
"People often think liability coverage and UM/UIM coverage are the same thing," Chacker says. "They're not. Liability protects someone else when you're at fault. UM and UIM protect you when someone else doesn't have enough insurance."
Four Steps Every Rideshare Passenger Should Take
If you rely on rideshare as your primary transportation in Pennsylvania or New Jersey:
Ask about non-owner car insurance. Get a quote from your current insurer or shop online. It may be more affordable than you expect, and it fills a gap that could otherwise leave you with no recovery after a serious accident.
Check your existing coverage. If you do own a car, verify whether your policy includes UM/UIM coverage and whether it is stacked. Your auto policy may already protect you as a rideshare passenger.
If you're in an accident, don't assume you're covered. Call a lawyer before signing anything or speaking with any insurance company. The coverage landscape in rideshare cases is complicated, and what you say in the first 48 hours matters.
Know your rights as a passenger. In Pennsylvania and New Jersey, injured passengers generally have full tort rights regardless of the vehicle owner's tort election. You may have more legal options than you realize.
The gap in rideshare insurance coverage is a policy failure, not a personal one. But until the law in Pennsylvania and New Jersey catches up to how people actually get around in 2026, the responsibility falls on riders to protect themselves.
If you've been injured in a rideshare accident in Pennsylvania or New Jersey, contact Gay Chacker & Ginsburg for a free consultation.
