Did you know that 60 percent of American consumers order either takeout or delivery at least once a week? The demand for fast and delicious food delivered right to your door is likely a big reason why you may have seen so many new delivery vehicles on the road around. Maybe you’ve even considered signing up with one of the popular third-party delivery applications or thought about becoming a rideshare driver to earn some extra cash for the holidays. While this can be a good way to make money on the side, you’ll need to consider how this change could affect your insurance coverage. Will your current auto insurance policy protect you in the event of an accident on the job? Keep reading to learn more.
How Does Car Insurance Work for Third-Party Delivery Drivers?
If you decide to become a driver for any of the popular third-party food delivery companies or ride-hailing apps, you must remember one of the key rules regarding auto insurance: the use of a personal vehicle for business-related duties and/or the transportation of business goods is typically excluded from your coverage. This exclusion can also extend to those who use their car to make trips to the bank or the post office and are involved in an auto accident. So, how do people use their cars to make deliveries?
Do I Need Special Insurance if I Become a Delivery Driver?
It’s no secret that any vehicle that’s driven or parked on a public roadway must carry the state minimum requirement for liability coverage. And failure to do so can result in many legal issues including license suspension, tickets, and even litigation if another driver sues you. Because of this, many food delivery companies state that all drivers must at least maintain the required amount of liability coverage for their state of operation.
But if your current auto policy lists “driving for hire” as an exclusion, you won’t have coverage while making deliveries. This creates a gap in your insurance coverage that will need to be made up for with other insurance investments.
Will the Delivery Company Offer Insurance Coverage?
Depending on the company you work for and where you drive, you may be able to bridge that gap in your personal auto insurance coverage with insurance protection provided by your employer. However, the rules for this type of insurance coverage usually state that you must be logged into the delivery application, have the application open, and be in the process of making a delivery to be eligible to make a claim. If you have the app open and are driving around waiting for your next delivery opportunity, any accident you are involved in will likely not be covered.
Additional Auto Insurance Options for Delivery Drivers
With a commercial car insurance policy, you can rest easy knowing that you have proper coverage, whether you are hit by another driver or at fault for an accident.
This may be an option for those who use their car for limited business use. If you are a full-time food delivery or rideshare driver, you may be ineligible for this type of policy
Contact Hopson Agency Today
Before you take on a new job as a delivery driver, make sure you have the proper auto insurance coverage in place. Our friendly and knowledgeable independent agents are here to help you explore your options and help provide you with peace of mind. Call (303) 460-9906 or contact us today for more information, and be sure to request a free quote.