Food delivery on-demand is a growing service in cities across the U.S, where third-party services facilitate order, pick-up, and delivery between local restaurants and their patrons. As the niche grows, more and more drivers are taking on shifts to earn cash from the comfort of their vehicles, whether part-time or full-time. While many workers gravitate toward the flexibility of food delivery, there are downsides – namely, the challenge of finding car insurance that protects against the many risks of the job. If you are a food delivery driver or thinking about signing up to work in this market, make sure you understand what your personal and company insurance covers, as well as what types of coverage you may need to supplement your personal policy.
Know Your Policy’s Exclusions and Exceptions
Imagine causing an accident and finding out your personal liability insurance is void because you were driving for hire at the time of the collision. Your company offers only limited liability for the damages you caused the victim, and you are left with no coverage for your own injuries and car repairs. You find yourself staring at thousands of dollars in accident-related costs that you thought you were covered for.
This type of scenario is not just possible – it is common. With millions of drivers working for companies like Uber, accidents are bound to happen, and someone has to pay for them. Unfortunately, many insurance companies include clauses that exclude coverage for drivers working for hire.
Although most companies require personal insurance for food delivery drivers, many also provide their own supplemental hired auto and non-owned auto coverages, although protection is often limited. To activate coverage, companies usually require drivers to have their service app on. While waiting for an order to come through, you may find that you have low-limit liability coverage and little or no protection against other losses, such as uninsured motorist protection. The coverage may increase only once a driver accepts an order and begins the process of pick-up and delivery.
While employer-sponsored coverage may help protect you against the damages you cause to third party individuals and property, it often excludes protection for your own vehicle’s physical damages at all points of service. If your personal auto insurance also excludes coverage for physical damages when driving for hire, you could be spending hours behind the wheel without coverage for your own car, leaving you vulnerable to accident-related losses. If you were to total your vehicle while picking up a delivery, could you afford to replace it?
Coordinating Your Coverage and Benefits
It is important to work with your independent agent to determine the gaps that exist in your personal and employer coverage. If necessary, you may be able to purchase supplemental protection or commercial coverage that protects you and your vehicle while performing deliveries. At G&L Insurance, we can help you explore coverage options that are customized to the unique risks you face as a food delivery driver here in Wisconsin. For more information or to request your free quote, contact our office today.