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You might get your state’s required coverage, and in some cases extra protection, from the company you work for. But in many cases, you need rideshare coverage to fill in gaps not protected by your company.
If your car insurance company excludes deliveries under rideshare insurance, you’ll need separate commercial car insurance.
Adding rideshare coverage to your car insurance can extend your personal auto coverage to your delivery driving. The coverage fills in gaps from your delivery company’s insurance, protecting your car with the coverage you bought on your personal policy.
However, some car insurance companies list deliveries as an exclusion to its rideshare coverage. In this case, you either can switch car insurance companies or get protection from a commercial auto policy.
Commercial car insurance policies work best if you own a delivery business or need coverage that isn’t provided by your delivery company or rideshare insurance. Coverage to look for:
A typical commercial car policy could cost you $750 to $1,250 per year if you’re getting a full suite of coverage for liability, comprehensive and collision. However, you might pay only $100 to $300 extra if you’re supplementing your employer’s coverage with comprehensive or collision.
Since many variables are involved here, like what your employer covers, your premium can vary considerably compared to other businesses. Factors that affect your delivery driving rates:
Important note
You could cut down on some of your vehicle expenses when filing your taxes. The IRS allows drivers to deduct costs like gas, insurance or car repairs if you use your car for business purposes. Be sure to check with your accountant to see if you’re eligible.
Some personal car insurance policies provide limited coverage if you make deliveries as a side hustle. While this may work for drivers who deliver on a very limited basis, there are a few concerns with relying on your personal policy:
Your personal policy won’t cover you if you use your car primarily for delivery driving. Consider whether you use your car for deliveries a majority of the time. If most of the mileage you drive on that car is delivery-related, it probably needs a separate commercial policy.
If you work for an employer or delivery service company like UberEats or DoorDash, you probably have some coverage through that company. But getting enough coverage can mean a bit of patchwork, matching up the coverage your company provides and other coverage you need.
Steps to finding and buying the right coverage:
Most app-based delivery companies leave gaps in your insurance coverage while you’re driving for them.
The same goes for pizza delivery since restaurant owners may provide only the state minimum car insurance required for its employees — and the types of coverage and coverage limits can vary for each store.
If you work for a pizza restaurant, your employer should have some business insurance to cover your delivery driving.
However, its business coverage might be limited to commercial nonowner liability, which means you’re covered for property damage and bodily injury liability while driving for your restaurant. Damage to your car might not be covered.
You’ll want to ask your employer how insurance works if a car accident happens on the job. For safety’s sake, you might get a response in writing. If your restaurant doesn’t cover some damage or breakdowns, you’ll want to look into commercial car insurance.
Even if your company meets minimum state requirements, you may want extra liability or add-ons like collision, comprehensive or underinsured motorist coverage through a commercial car insurance policy.
What’s covered by different app delivery companies:
Delivery app | Liability | Comprehensive & collision | Other notes |
---|---|---|---|
Amazon Flex | Yes | Yes, if they’re on your personal car insurance |
|
DoorDash | up to $1 million, kicks in after your personal policy | No coverage | No coverage while waiting for an order |
Grubhub | No coverage | No coverage | |
Instacart | No coverage | No coverage | |
Postmates | up to $1 million, kicks in after your personal policy | No coverage | |
UberEats | up to $1 million | Yes with a $1,000 deductible, if they’re on your personal car insurance | Liability limits are 50/100/25 while waiting for an order |
Compare car insurance companies near you.
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Because some people are delivering food or other items during the coronavirus, some states are calling for companies to extend personal auto insurance to delivery drivers. States that have requested free delivery driver coverage:
You can check with your state’s department of insurance or your insurance company to see if this free coverage applies to you.
If you’re a food delivery driver or caterer, you need car insurance like everyone else. But a personal policy or an employer’s policy might not provide all the coverage you need.
Compare car insurers who offer the right amount of protection you need for the job.
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