Food delivery services are booming and forecast to grow by 12 percent through 2023. Whether working a delivery job as a side hustle or a full-time job, it's important to understand that you must have the right coverage when using your personal vehicle for business purposes. Delivery companies like Uber Eats, Grubhub, Doordash, and Postmates employ hundreds of thousands of delivery drivers. Your personal auto insurance policy will not provide coverage when you are driving your own vehicle for business purposes. It's important to shop for commercial auto insurance coverage to avoid any coverage gap while on the clock.
Is there special insurance for delivery drivers?
A personal auto insurance policy only covers social use and basic commuting, not when you use your own car for business use. Personal coverage isn't enough coverage if your business use is less than 100 miles a day or three times a month. It's a legal requirement to disclose with an insurance carrier if you intend to use your own vehicle for food delivery. Failure to disclose this information could result in your insurance carrier canceling your policy.
Food delivery drivers should invest in a business coverage policy to serve as a food delivery auto insurance coverage. Business coverage for food delivery gives you peace of mind when traveling to various job sites, transporting tools or equipment, delivering food and other goods, making sales, and transporting people.
What types of policies are there for delivery drivers?
There are different types of coverage that delivery drivers can choose from. A commercial auto insurance policy provides coverage in the event of an accident while working a delivery job. The premium is based on the type of car, your driving record, and your demographics. You need to protect your personal vehicle with a business-use policy if you make food deliveries, travel long-distance to job sites, transport work tools or equipment, provide rideshare services, or make sales. You'll still need a personal auto insurance policy to meet the required state minimums. Most personal policies don't cover any accident or property damage that occurs during business use.
According to autoinsurance.org, delivery driver insurance cost is determined by your ZIP code, driving record, credit score, type of policy, and more. Delivery driver insurance policies have varying deductibles and coverage limits that affect your premium. The best way to ensure you get the right coverage for the best price is to compare insurance policy quotes from different insurance companies. Be sure to determine the level of coverage you need and have your vehicle information available. You'll need to provide information about your car including the make, model, and VIN to request accurate food delivery insurance quotes.
Adding extra coverage to your personal policy means paying extra money. You'll see your premiums rise the more your insurer considers your risk and liability. Using your personal vehicle for intensive business use puts you at a higher risk of getting into an accident and needing to make an insurance claim.
Do delivery services provide coverage for drivers?
Rideshare companies and on-demand food delivery companies aren't legally required to provide insurance for their drivers. Certain rideshare companies offer full or partial coverage for their drivers, but that doesn't mean there aren't gaps in coverage. Uber provides delivery drivers supplemental liability coverage and additional comprehensive coverage and collision coverage if you already have this type of coverage on your personal policy. Uber auto insurance coverage provides Uber drivers up to $1 million in liability coverage and up to $100,000 in collision coverage per accident. It's important to note that delivery insurance is only applicable when delivery drivers are actively logged in and using the app.
The best way to ensure you have enough coverage as a delivery driver is to add extra coverage to your personal auto policy.