Auto insurance is a necessity for all drivers, but finding rideshare coverage can still be tricky if you drive for Lyft or Uber.
Opton, a new rideshare insurance provider, is hoping to make getting coverage much easier, using an app based on demand approach.
What Is optOn Insurance?
Instead of requiring customers to sign up for six- or 12-month terms, its policies are set for four-hour increments.
Opton is available on demand through the app, so Lyft and Uber drivers are able to access short-term coverage instantly.
There are three policy tiers. Each offers traditional coverage areas, but they’re not designed to replace a traditional insurance policy. Instead, they work as a compliment to your personal coverage and that of the service you work with.
Where Is optOn Insurance Available?
Currently, the company only offers insurance for drivers in Illinois, but it has a plan for market expansion in the future.
How Does optOn Work?
Every micro policy is set for four hours of drive time, and once it’s activated, the app begins a countdown. However, you have the option to end coverage before the four-hour mark, as well as extend it as needed.
The entire process takes place through the app, and changes are effective immediately.
The system sends a notification 15 minutes before each policy expires. At this time, you have the option to renew it before it ends. If you don’t make a selection, your coverage automatically stops when the timer on the screen runs out.
One of the coolest features of the app is the accident detection. If an accident occurs and is jarring enough to trigger the system, the app will guide you through what you need to do.
You can also file claims with Opton directly through the app or by calling the support number.
The Opton number to call in event of an accident is 866-789-5699.
What Does It Cost?
Opton charges not by time but by miles driven.
The app tracks your on-the-road movements to determine the final charges.
Before you select a policy, the app shows you the per-mile costs for each option. When you activate your desired plan, it locks in the mileage cost for the duration of the policy.
The micro-policy rates are determined by your vehicle and driving habits. Their algorithm also considers circumstantial factors, such as the time of day and location.
Once you activate a policy, Opton also puts a temporary $50 hold on your linked account. However, it’s automatically lifted once the coverage ends and the final charges are applied.
On top of the per-mile charge, drivers are charged a state-specific administration fee.
In Illinois, it’s set at $0.99. For policies that don’t end up reaching the $1 minimum, there’s also a premium charge – usually around $1.
These elements are pretty standard for insurance companies, but if you drive full-time for Lyft or Uber, you face around $4 in additional costs for an eight-hour shift. Over a week, that’s another $20 out of your profits on top of your insurance expenses.
As with most auto coverage, there’s also a deductible. The out-of-pocket costs range from $500 to $1,000. Lower coverage is associated with a higher deductible and vice versa.
Opton Coverage Options
Opton offers three different levels of rideshare insurance: Primary, Preferred, and Premier.
All three tiers offer liability, collision, and medical coverage. They also include financial protection against uninsured motorists.
The biggest differences between Opton’s policy levels are the out-of-pocket costs and coverage limits. Here’s a closer look at each variation.
The Primary micro policy is the basic plan. It offers the lowest per-mile rates, but it’s also accompanied by a $1,000 deductible — the highest of all tiers.
The Preferred micro policy is Opton’s mid-level coverage plan. The mileage rates are slightly higher than the Primary policy, but the deductible is only set at $750. On top of a lower deductible, the policy offers higher coverage limits than the lower plan.
The Premier policy is designed to provide the maximum amount of protection through Opton. It’s associated with the highest per-mile rates, but it features the lowest deductible at $500. The individual coverage limits for liability, collision, and medical are all higher than the lower two tiers as well.
How to Sign Up for Opton
Step 1: Create an Account
Opton requires your legal name, driver’s license number, vehicle VIN, and a payment method. The provider accepts debit and credit cards, but isn’t yet linked to PayPal.
Step 2: Evaluate Your Options
Once you’re in the system, it’s time to choose a policy. The app will show you options as well as the current per-mile rate. The amount shown is locked-in for the duration of the micro-coverage, so you don’t have to worry about rate increases as you drive.
Step 3: Make a Selection
After deciding on a plan, tap “purchase.” This initiates the policy countdown. When you’re done driving, simply tap “end coverage” and review your receipt. Or, if you approach the four-hour mark and still need to make more trips, tap “renew” before your time expires.
optOn And Choosing the Right Rideshare Insurance
Opton offers an innovative approach to rideshare insurance.
The coverage is customizable and convenient, and will likely appeal to part time Lyft and Uber drivers.
However, if ridesharing is your primary job, you may find traditional selections better in the long run.
Not sure which coverage style is right for your needs? Learn more about your options with our rideshare insurance guide.