The Difference Between Taxi Drivers and Rideshare Drivers

When it comes to getting around in the city, whether you’re going across town or the country, there are always options available to you that could save you money and get you where you need to go quicker. That’s where taxi drivers and rideshare drivers come in, ready to provide their services to anyone who needs them.

Most people are curious about how rideshare drivers differ from taxi drivers. If you’re trying to decide whether Uber or Lyft is right for you, the biggest difference between rideshare drivers and taxi drivers boils down to two things: regulation and marketing strategy.

If you’re looking to drive as an independent contractor with either rideshare company, though, it’s important to know your rights and responsibilities as a rideshare driver under federal law.


Unlike taxi drivers, rideshare drivers use their vehicles to pick up riders. This allows them to use a wider range of vehicles (e.g., minivans, sedans), but it also means they need to adhere to certain regulations that taxi drivers don’t need to follow (e.g., maintenance requirements, vehicle condition standards).

In some cities, rideshare drivers are required to maintain fleet taxi insurance coverage beyond what is typically provided by personal car insurance policies. Since there are fewer rules and regulations surrounding rideshare driving than traditional cab driving, less training is involved in becoming a driver on most platforms.

Since rideshare drivers use their vehicles to pick up riders, it’s important to be aware of your vehicle’s condition. You’ll need to maintain your car according to any restrictions imposed by your city, as well as make sure that you are in good financial standing with your vehicle loan.

In addition, if you drive for a company like Uber or Lyft, you should ensure that your specific vehicle complies with each platform’s standards (for example, Uber accepts only four-door cars 2005 or newer; Lyft has slightly different requirements). Finally, since driving for a ridesharing service is also considered a job (in addition to being a part-time gig), it makes sense to take every advantage afforded worker.


Uber and Lyft use a different pricing model than taxis. Taxis set fares based on distance or time, while ridesharing companies charge a flat rate or a fee per mile. However, ridesharing companies can sometimes charge more than taxis for longer trips at certain times of the day due to surge pricing.

Ridesharing apps tell you upfront how much your ride will cost before you accept it, but you can also ask your driver what type of vehicle they drive to get an idea of how much you’ll pay. (For example, most drivers using Lyft are driving newer cars like Toyota Priuses.)

If you take multiple rides from one company throughout a week or month (perhaps if it’s cheaper when using uberPOOL), make sure you keep track of all charges and/or receipts to ensure nothing gets lost in translation.

Most ridesharing companies offer an in-app method for you to estimate a fare before you accept a ride, but third-party websites can also help you figure out what your fare will be.

If you’re travelling at rush hour, know that rideshares could cost more than taxis if it takes longer than normal for your driver to get to you.

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