The Rise of App-Based Delivery Jobs in Duluth and Superior

April 20, 2022

Since 2019, and especially during the COVID-19 pandemic, app-based deliveries have exploded in popularity. Whether it’s a second job, a career change, or your teen’s new summer gig, delivery jobs are more in demand than ever. In Duluth, Superior, and across Minnesota and Wisconsin, the rise of app-based delivery jobs in Duluth and Superior mean more drivers are on the road delivering food, groceries, and goods that all need proper insurance.

In 2020, there were over 1.5 billion food delivery app users worldwide, and the U.S. alone had more than 1.3 million delivery drivers. By 2029, the industry is projected to grow into a $320 billion market, showing no signs of slowing down.

Are You Properly Insured as a Delivery Driver in Minnesota and Wisconsin?

Before you or someone on your policy takes on a delivery job, it’s crucial to review your auto insurance policy. Many delivery companies, like Doordash, Uber Eats, and Grubhub, may ask for proof of insurance, but don’t assume your personal policy covers delivery work.

Here’s why: Delivery drivers for app-based services are often classified as independent contractors, which means the responsibility to be adequately insured falls squarely on the driver. Most personal auto insurance policies won’t cover accidents that happen while you’re working as a delivery driver unless you have the right coverage in place.

Insurance Coverage Varies by Delivery Company

Understanding the insurance coverage offered by various delivery companies is critical to avoiding costly mistakes. The rise of app-based delivery jobs in Duluth and Superior is great for both consumers and job-seekers! Here’s how some of the major companies handle insurance for their drivers:

Doordash: You must first file a claim with your personal auto insurance. Doordash’s supplemental policy will only cover damages exceeding your insurance limits.
Grubhub and Instacart: These companies provide no liability insurance. In an accident, you must pursue a claim against the at-fault driver’s insurance.
Uber Eats and Postmates: These platforms use a three-stage liability system. When actively delivering, Uber’s $1 million policy applies. Postmates, now owned by Uber, follows the same system.
Shipt: Offers liability coverage only while a customer order is in your vehicle.

The End of Pandemic Coverage and New Risks for Delivery Drivers

During the height of COVID-19, many insurance companies extended coverage to include personal vehicle use for deliveries. However, these special concessions have expired, leaving delivery drivers exposed. If you don’t have the right coverage, one accident could result in hefty out-of-pocket expenses, negating any earnings from your side hustle. This risk is particularly high in busy areas like Duluth, Superior, and surrounding communities.

Why Delivery Drivers Face Higher Accident Rates

Delivery drivers have some of the highest accident rates per capita, and with more people using food, grocery, and package delivery services, those numbers are only increasing. Here’s why delivery drivers in Minnesota and Wisconsin face elevated risks:

Rushed Deliveries: The expectation to deliver food quickly leads to unsafe driving practices.
Fatigue: Many drivers work long hours, sometimes balancing a full-time job with their side-hustle. This can result in inattentiveness or slower reaction times.
Inexperience: Younger drivers or those unfamiliar with frequent stops may struggle with the pace of delivery work, leading to more accidents.

New Insurance Options for Delivery Drivers in Duluth and Superior

To address the rising risks, many companies now offer endorsements on personal auto policies for a small additional fee. When a driver activates a delivery app, the company’s insurance (like Uber Eats or Lyft) becomes primary, and when the app is turned off, the personal policy kicks back in.

However, for restaurant delivery drivers or those who clock more miles, a commercial auto policy may be necessary. The right policy depends on various factors, such as who your insurance company is, how many miles you drive, and the type of delivery work you do.

Talk to a Reliable Insurance Agent Before You Start Driving

Before accepting any delivery job in Duluth, Superior, or surrounding areas, make sure you talk to your insurance agent. Whether you’re delivering for a national platform like Doordash or a local restaurant, you’ll need the right coverage to stay protected. At Reliable Insurance Agency, we can help you explore your options and ensure you have the proper coverage to stay safe and financially secure on the road.