Since the beginning of 2019 and the COVID-19 pandemic, we have seen app-based deliveries explode in popularity. For a variety of reasons, many Americans are joining this labor force as an easy source of supplemental income. Whether it is a second job, a change in careers altogether, or your teen’s new summer job, this income source is becoming more sought after than ever before. For all these reasons, there are more delivery drivers on the road than ever before. In 2020 alone there were 1.5 billion food delivery app users worldwide and over 1.3 million food delivery drivers in the United States.

Over 40% of Americans use a delivery/website app at least once every three months. In the United States alone, over $22 billion was spent on food delivery in 2021. By 2029, it is estimated that this will be a booming $320 billion industry.

We cannot stress how important it is to read your auto policy before taking a delivery job! You will likely be asked to show proof of auto insurance prior to employment. Some food delivery app companies do offer their drivers supplemental insurance, but not all. This is why we urge delivery drivers to know exactly what their personal insurance policy includes. Because a driver for one of these services is technically an independent contractor, it falls on the shoulders of the driver to be properly insured while driving.

• Doordash: you must file a claim with your personal auto insurance first. Doordash’s supplemental policy will cover damages that exceed the driver’s insurance limits.
• Grubhub and Instacart: neither provides any liability insurance for its drivers. You will have to pursue a claim against the negligent driver.
• Uber Eats and Postmates: this service applies a three-stage liability system for its drivers. If the driver was actively delivering an order for Uber Eats, you could file a claim against Uber’s $1 million policy. Postmates was acquired by Uber in 2020.
• Shipt: offers liability insurance for drivers who actively have a customer order in their vehicle, otherwise they provide no additional coverage for drivers.

Because COVID-19 disrupted nearly every aspect of normal daily business, many insurance companies expanded their coverages to include personal vehicle use while delivering food or medicine during the height of the pandemic. But these special concessions have expired and the last thing you want to do while trying to make a few extra bucks is to become saddled with a large out-of-pocket bill because you were unwittingly uninsured while using your personal vehicle. One unfortunate accident, and you could find yourself spending all that hard-earned money taking care of repair or medical bills after your insurance carrier denied your claim because you were delivering food, groceries or other goods.

Delivery drivers were involved in the most accidents per capita since 2003. With the popularity of food, grocery and other delivery services growing exponentially, these numbers will only continue to grow.

The very nature of the job is often the cause for these increased accident rates. Much of what we all love about having food delivered puts the delivery driver and others at increased risk of being involved in some type of an accident.

• Orders are delivered quickly but this expectation requires that drivers rush each delivery, often resulting in unsafe driving practices.
• Some drivers work long hours, especially those that have a full-time job and pick up a delivery job as their side-hustle. This can result in inattentive driving and slower reaction times to hazards on the road.
• Lack of driver experience, especially with younger drivers and those not accustomed to making frequent stops, puts them in unfamiliar situations and increases the likelihood of being involved in accidents more experienced drivers are more likely to avoid.

Recently, many companies have added an endorsement on the personal auto policy. Basically, it means that when the client turns on their delivery app and accepts a ride or delivery the coverage under the personal auto policy is no longer available and the company (Lyft, Uber Eats, etc) becomes the primary. As soon as the app is shut off or delivery of goods is complete the personal auto policy will kick back in. This typically is provided for a small additional charge. For other delivery jobs, like with most restaurants, the driver will likely need to get a commercial auto policy. Which option is best for you can depend upon many factors including who your auto insurance is with, who you are delivering for, how many miles you drive monthly, and what coverage the delivery company offers. There are many different factors that determine what type of policy is best for you.

Your insurance agent can help you find your best coverage option. Contact them before you or any driver on your policy accepts a delivery job.