6 years experience in the personal financial industry
Theresa is a writer and former financial advisor with experience helping clients solve money challenges. She uses her expertise to clarify complex personal finance concepts.
As Insurify’s home and pet insurance editor, Danny also specializes in auto insurance. His goal is to help consumers navigate the complex world of insurance buying.
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Companies like Uber Eats and DoorDash have made earning cash as a delivery driver easy. However, many drivers overlook how delivery driving can affect their car insurance, leaving them vulnerable if they get into an accident while on the job.
Here’s what you need to know about car insurance for delivery drivers.
Quick Facts
Standard auto insurance policies typically exclude coverage for delivery drivers.
Delivery drivers may need separate commercial auto insurance or an add-on for their existing policy.
You should notify your insurer when you become a delivery driver to avoid potential coverage gaps.
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What is delivery driver insurance?
Delivering items for companies like DoorDash and GrubHub has become a popular way to earn money. However, you may not realize there’s often a gap in coverage between your standard car insurance and your rideshare insurance.
Delivery driver insurance fills that gap. It’s not a specific type of insurance, but rather additional coverage delivery drivers may need, such as a commercial car insurance policy or a rideshare endorsement. Both options offer protection for your vehicle while using it for business use, including delivery driving.[1]
To cover the added risks of using a vehicle for business activities, commercial car insurance and rideshare endorsements generally provide more robust coverage than standard car insurance. Some rideshare companies offer insurance for their drivers, but coverage typically only applies during active delivery time.[2]
Like traditional auto insurance, delivery driver coverage may include the following:
Property damage liability
This coverage helps pay for damages you cause to someone else’s vehicle or property.
Bodily injury liability
This covers the medical expenses and lost wages of someone injured in an accident you caused.
Comprehensive
This optional coverage protects you from non-collision events, like theft, vandalism, and damage from animals.
Medical payments
If you or your passengers get injured in an accident, this coverage may help pay for doctor’s appointments, hospital stays, and other medical expenses, regardless of fault.
Uninsured/underinsured motorist
This coverage helps pay your expenses if a driver hits you and doesn’t have adequate insurance.
Coverage for delivery accidents can vary by insurer and location. It’s crucial to shop around and compare quotes to ensure you get the best deal for your needs.
Commercial car insurance offers protection for vehicles you use for business purposes. “Commercial auto insurance is designed for an individual or company who owns and uses their vehicles to conduct their business on a daily basis,” says Scott Henman, certified insurance counselor and owner of Michigan Insurance and Financial Services.
Commercial car insurance helps protect you from unforeseen incidents on the road and may include property damage, bodily injury liability, and uninsured motorist coverage. It offers the most protection for delivery drivers, but it comes at a high financial cost.
“A commercial insurance policy for delivery drivers is costly and unnecessary in most cases,” says Henman. “Unless it’s for a fleet of vehicles and is the company’s primary operation — for example, distributors or grocers who offer their own delivery services.”
Rideshare endorsement
A rideshare endorsement is an add-on to your personal auto insurance and is typically more affordable than a separate commercial auto insurance policy. A rideshare endorsement helps bridge the coverage gap between your personal auto policy and the coverage your rideshare company provides. However, rideshare insurance availability can be limited.[3]
“Not all insurance companies offer rideshare endorsements, and some do on a state-by-state basis,” says Henman. “Small regional insurance companies are typically reluctant to offer rideshare coverage.”
If you’re considering becoming a rideshare driver, contact your insurance company to discuss your specific needs and explore the available rideshare insurance options. Make sure the policy covers you at all delivery stages and not just certain times.
Who needs delivery driver insurance?
Most delivery drivers will need to purchase additional auto coverage, and some states even require it. Since you use your vehicle for business purposes, personal auto insurance policies may not always provide adequate coverage.
Delivery drivers face a unique set of risks that everyday drivers don’t. Their vehicles are frequently on the road, often in urban areas with heavy traffic congestion. Time-sensitive deliveries may lead to driving under pressure, which may increase the likelihood of accidents.
Drivers who should consider getting extra car insurance include:
Food delivery drivers
Package delivery drivers
Couriers
It’s crucial to notify your insurer when you become a delivery driver.
“Failing to disclose rideshare activities on an insurance application is cause for a complete rescission of the policy should an incident occur,” says Henman. This would mean auto coverage cancellation retroactive to your policy’s start date.
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Does personal car insurance cover delivery drivers?
The short answer is no. Most personal auto insurance policies, as the name suggests, are designed for personal use and likely won’t cover accidents that occur while using your vehicle for business purposes, including delivery driving. Some personal insurance policies exclude coverage for delivery drivers, while others offer rideshare insurance for an additional cost.
If you’re unsure whether your personal auto insurance covers you while making deliveries, review your insurance contract.
“It is a best practice for drivers to review their insurance policies for accuracy, including the conditions, endorsements, and exclusions in their policy, and not assume the policy is correctly structured,” says Henman.
Some insurance companies offer delivery driver insurance to protect you while using your vehicle for business purposes. Here’s how to get coverage.
Determine how much insurance you need
Most states require a minimum amount of car insurance for all delivery drivers. The specific coverage varies by state. Aside from meeting your state’s requirements, an important factor when calculating how much insurance you need is the out-of-pocket costs you can afford in the event of an accident. You may want to consider increasing your coverage if the answer is zero or close to it.
You should also consider your financial situation. If you have significant assets, consider purchasing umbrella insurance, which provides additional liability coverage above the limits in your auto policy. Other optional car insurance coverage includes roadside assistance and rental reimbursement insurance.
Research insurance companies
Not all insurance companies offer insurance for delivery drivers. Finding coverage requires researching the options from different insurance companies. A good place to start is with your personal auto insurance company. Call to inquire about its coverage options for rideshare drivers.
As with any type of insurance, whether it be auto, home, or life, it’s important to consider the reputation and financial strength of an insurance company you’re considering. Moody’s and S&P Global are two trusted sources for insurance company ratings.
Ask about discounts
When comparing insurance options, be sure to ask about available discounts that can help reduce your premium. Common discounts include safe driver discounts, multi-policy discounts (if you purchase multiple insurance policies with the same company), and discounts for safety features on your vehicle.
Get quotes
Comparinginsurance quotes is essential to finding the right coverage for your specific needs. Make sure to fill out applications thoroughly to ensure you receive the most accurate quote possible.
It’s important to provide each company with the same information and to ensure that the coverage and deductibles are similar so you’re comparing rates accurately. You can shop for quotes online or work with an independent insurance agent or broker.
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Purchase a policy
Once you’ve decided on the delivery driver insurance that’s right for you, you can typically pay the premium up front or at regular intervals, such as monthly or quarterly. You may receive a discount for paying the total cost all at once.
Delivery driver insurance FAQs
Delivery driving can be a great way to bring in extra cash, but it’s essential to understand its effects on your car insurance. Below, you’ll find answers to some commonly asked questions about delivery driver insurance.
Do you need to tell your car insurance company if you start delivery driving?
Yes. You must inform your insurer if you start using your car for deliveries.
Ideally, you’ll want to notify your insurance company before using your vehicle for business purposes to avoid potential coverage gaps. Failing to disclose your business activities could lead to policy cancellation and denial of claims for accidents that occur while you work.
What happens if you get into an accident while delivery driving?
The process is similar whether you get into an accident while driving for personal or business reasons: Check yourself and your passengers for injuries, call the police, and exchange information with the other driver.
Once you’re in a safe place, call your insurer and rideshare company to notify them of the accident and inquire about the next steps.
Will your car insurance rates go up if you start delivery driving?
Probably. Your car insurance will likely go up when you start delivery driving. Using your car for deliveries costs more because standard auto insurance only covers your vehicle for personal use, not business use.
To ensure adequate protection as a delivery driver, you may need to purchase additional coverage, such as a rideshare endorsement, which will increase your premium.
Which insurance is best for DoorDash?
A rideshare endorsement or commercial auto insurance policy are the two best options for delivery drivers, including DoorDash drivers. It’s important to carry your own insurance as a DoorDash driver, as the company coverage only kicks in for accidents that occur during active delivery time and only after your own insurance runs out.
DoorDash. "Does DoorDash provide third-party liability insurance for Dashers?."
Uber. "Insurance for rideshare drivers using Uber."
Theresa Stevens
Theresa Stevens is a personal finance writer based in Boston, Massachusetts. Her work has been featured in Forbes Advisor, Bankrate, and more. As a former financial advisor, she has first-hand experience helping people solve their money challenges. When she's not writing, you'll find her trying out new karaoke spots or planning her next trip abroad.
As Insurify’s home and pet insurance editor, Danny also specializes in auto insurance. His goal is to help consumers navigate the complex world of insurance buying.
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