If you recently caught an Uber or Ola rather than a taxi, you know about ridesharing. You may even want to offer rideshare services for a living. Whether it’s DiDi, GoCatch, Ola, Shebah or Uber, rideshare is here to stay. We look again at the pros and cons of ridesharing.
1. What are the benefits of being a rideshare driver? ›
2. What are the disadvantages of rideshare driving? ›
3. What are the benefits of using rideshare? ›
4. What are the disadvantages of using rideshare? ›
5. Do you need rideshare car insurance? ›
6. What about green slips for rideshare? ›
1. What are the benefits of being a rideshare driver?
There are lots of benefits of being a rideshare driver:
Be your own boss – How you work is your choice. You can choose your own hours and work around family or another job, meet lots of people and be out and about in your own area.
Help others be mobile – Help others who can’t drive, those who don’t have public transport or don’t like it, and people who avoid driving to social gatherings.
Use your car more – Most cars stay parked for 95% of their useful life (49.4 weeks per year). You have to keep paying fixed costs, such as car loan, CTP greenslip and motor insurance, whether you use it or not. If you pay $1,280 per year for registration and CTP for 2.6 weeks per year, it costs you $492 per week. That doesn’t even include the cost of a car loan.
Earn casual money – How much you earn depends on your work habits and which rideshare provider you use. Most charge around 15% commission, except for Uber:
Uber –Drivers pay 27.5% commission including 2.5% GST* and receive 75% of trips.
Ola – New drivers receive an introductory rate of 92.5% for 30 days then 85%.
GoCatch – Drivers receive up to 85% of trips.
Shebah – Drivers receive 85% of every trip. Service for women and children only.
DiDi – Drivers receive 86% of trips in Sydney. Didi Advance rewards committed drivers with lower service fee and bonus perks.
inDrive – Drivers pay 0% service fee for a limited time** then receive 90% of trips.
* Uber Green drivers who use an EV pay half the service fee until June 2025.
** inDrive is a newer entrant to rideshare where passengers suggest the price they want to pay for a particular trip. Nearby drivers can accept the fare or make a counteroffer, giving the passenger a choice.
Note: It can be difficult to compare actual pay rates because every driver works different hours and may also work for more than one provider.
2. What are the disadvantages of rideshare driving?
Of course, rideshare driving has its disadvantages. Your reasons for doing rideshare driving can equally be reasons why not to do it.
Be your own boss – choosing your own hours and working around other commitments means your income could be less reliable. Peak periods for rideshare may not be the times that suit you to work.
Help others be mobile – By opening your car to strangers, you meet every type. Some will be rude, drunk or difficult, which means you need good people skills and the ability to deal with conflict.
Use your car more – You may need to replace your car sooner than usual because of the extra wear and tear. Car insurance may cost more. Costs of servicing at recommended intervals, tyres, brakes and weekly fuel bills will increase. It is wise to keep checking fuel prices.
Earn casual money – Indeed says the average rideshare salary is $30.38 per hour, ranging from $17.25 to $46 per hour. This depends on whether you drive in metro or regional areas. For example, Uber sets lower base fares for regional drivers, even though they may travel longer distances and have higher fuel costs. The Ride Share Drivers’ Association of Australia claims regional drivers have begun to exit ridesharing because of high fuel costs and low pay increases.
3. What are the benefits of using rideshare?
There are lots of benefits of using rideshare for your travel:
Trusted choice – Independent Pricing and Regulatory Tribunal (IPART) in July 2023 revealed more Sydneysiders are using Uber, Didi, Ola and Shebah in 2023 than in 2019 (pre-Covid). Around 55% said they usually use a rideshare service and 44% said they usually hail a taxi.
It is easy – Download an app, open it up and put in your destination. A driver will accept your request and give you their details.
Practical option – Regular users told IPART rideshare offers value for money, convenience, fast waiting times and, especially in Sydney, availability.
Alternative to public transport – Not everyone wants to or can use public transport. In fact, average weekday public transport trips in Sydney are down 20% from pre-Covid levels and this may be the “new normal”.
4. What are the disadvantages of using rideshare?
The disadvantages of using rideshare are mostly related to driving skills, navigation, and the passenger’s feeling of safety with the driver:
Safety concerns – Some say there is a lack of regulation in this area and rideshare drivers should be screened. In fact, Shebah was set up for women who feel unsafe in rideshare. Taxis are considered to be safer.
Surge pricing – Uber uses surge pricing when demand is highest. Its recent deal with the NSW government will limit surge pricing during public transport outages. While surge pricing would be limited to about double the regular fare, this is still high.
Encourages car travel – We prefer to travel in the privacy of private cars. Griffith University says there are an average of 1.2 people per private car and, in suburbia, only one car for every person.
It’s not sharing – Rideshare is not really sharing because passengers have to pay for it. Sharing usually means being generous and giving something for nothing. Most of us don’t really like sharing.
In the end, whether or not to use ridesharing is a personal choice. It is just one travel option out of many.
5. Do you need rideshare car insurance?
Many people ask about car insurance for rideshare drivers.
Unlike other drivers, rideshare drivers must have third party property insurance. This is the minimum level of cover for repairing damage to somebody else’s vehicle or property in an accident. Comprehensive insurance is preferred because it covers the driver’s property as well as the property of others. Sheba requires drivers to have comprehensive insurance.
Comprehensive insurance is different for rideshare than for personal use. Some insurers may even exclude “carrying passengers for money”. Budget Direct, Coles, Huddle and Qantas don’t cover any ridesharing. ANZ, Kogan, and QBE cover you only if you drive less than 32 hours per week.
Note, Uber offers drivers extra liability cover for $20 million, but Ola, DiDi, GoCatch and Shebah do not offer extra insurance cover.
6. What about green slips for rideshare?
Rideshare drivers must have CTP green slip insurance to cover them for any personal injury claims made against them in an accident. Of course, you have to have a green slip to register any vehicle in Australia.
Our greenslips.com.au Calculator doesn’t directly ask owners if they use their cars for rideshare. It asks:
- Are you using your vehicle for business?
- Do you want to claim for GST?
- How far do you travel each year?
Driving for business, claiming GST and travelling longer distances all add to the final greenslip price.
Since April 2018, rideshare drivers with a fare-paying passenger also pay 10 cents per km for journeys starting in metro regions and 6.6 cents per km when starting in country areas. This rate applies only for fare-paying trips but also adds to the price of your green slip.
Read more about your greenslip and rules for rideshare drivers.
your opinion matters: