Are you thinking about becoming a delivery driver or worried if you have the right insurance cover? Continue reading to find out who will have to pay in an accident while you’re delivery driving and how to cover yourself.
The Other Driver?
Just because you’re a delivery driver doesn’t mean the general rules about fault and who pays for an accident change. If the other driver is at-fault for the accident, they will generally have to pay you for your financial losses. This might either be by making a claim against their insurance policy, reaching a settlement, or suing them in court.
Of course, if the other driver wasn’t at-fault, they likely won’t be responsible for paying you anything.
You may think that your insurance company will pay for an accident where you were at fault, no-fault was assigned, or the responsible driver was uninsured or underinsured. This is true in most cases if you have the right coverage, but delivery driving is a special situation.
When you’re a delivery driver — whether you’re an independent contractor through an app or an employee for a local business — you’re generally considered to be engaging in a business activity. Most personal car insurance policies don’t apply to business activities. They’re sold for personal use, and the contract you signed will usually say that anything outside of commuting, personal errands, and leisure driving is excluded. That means your insurance company won’t pay for a claim that happened while you were delivery driving.
If you have accident expenses that another driver doesn’t have to pay for and your insurance company won’t pay, that could mean that you have to pay. Yes, you could simply not have your car fixed after a minor fender bender, but think about what would happen if you seriously injured another driver. They or their insurance company would likely sue you, and you could lose your life savings or have your future wages garnished. Sometimes, you can’t even avoid paying a personal injury claim by filing for bankruptcy.
If your insurance doesn’t apply, and you can’t pay a claim yourself, do you have any other options to avoid financial ruin? Many employers carry their own coverage that extends to their delivery drivers. For example, a local pizza restaurant might carry a hired and non-owned insurance policy that provides coverage to their drivers during deliveries. Apps, like Uber Eats, often offer supplemental coverage that kicks in when your insurance doesn’t apply.
The bad news is that these policies are mostly to prevent your employer from being sued if you cause an accident and aren’t able to pay. This means they often have good liability limits but don’t cover damage to your car.
If you wouldn’t be insured or there are gaps in your employer coverage, you can buy special coverage on your own. Some personal car insurance policies allow you to add on optional coverage that covers typical gig economy jobs. You can also look into purchasing a commercial auto insurance policy. These options will cost more, but you’ll be able to drive without worrying about losing everything due to an accident. To learn more about your options, talk to Jarosch Insurance.