Delivery Insurance: GrubHub, DoorDash & UberEATS

April 2, 2019

insurance for delivery driversThinking of earning some cash as a driver for GrubHub, DoorDash, UberEATS, or Amazon Flex? You’re not alone. The gig economy is booming—with thousands of drivers eager to be their own boss, make their own schedule, and work from the comfort of their own car. Unfortunately, delivery drivers may be overlooking a pretty big threat: inadequate insurance.

Here’s why delivery insurance is so confusing… And what you need to know if you’re considering a job like this:

What are the delivery insurance requirements for GrubHub, etc.?

According to GrubHub, drivers must be age 19+, with 2+ years of driving experience, a valid driver’s license and “auto insurance.” (No specific wording on the type of auto insurance is mentioned.) DoorDash requirements for drivers are  equally vague, stating, “You can use any car to deliver. Just have a valid driver’s license, insurance, and a clean driving record.”

But this may not be the full story.

What kind of insurance do delivery drivers actually need?

This depends on 1.) what your current auto policy covers and 2.) how well the company you deliver for will supplement your personal coverage (if at all). According to the RideShare Guy, companies like UberEATS and Amazon Flex do it better than most. But that doesn’t necessarily mean you’re in the clear by choosing one of these employers. Let’s look at your current auto policy first…

Will my personal auto policy cover me as a delivery driver?

Probably not. Personal auto policies typically exclude any claims involving the paid delivery of goods—which could mean takeout food, groceries, newspapers, or packages. If you tell your carrier you are using your car to deliver goods beware they may cancel your coverage. Meanwhile, if you are involved in an at-fault collision while delivering food for GrubHub, DoorDash, or a similar food delivery app, it is very possible your insurance company would deny the claim—leaving you to pay for any damages.

Some insurance carriers do allow insureds to deliver food (say pizza, for example) if they are an employee of one specific restaurant, and if they use a private passenger vehicle (pickup trucks and vans would be excluded). Ask your local agent if your carrier is on this list. But again, beware that this kind of delivery coverage is different than driving for GrubHub, etc.

Drivers who deliver for takeout apps or for Amazon Flex are technically “public/livery conveyance” workers. Their work would not be covered by a standard personal auto policy, much like those who drive for Uber or Lyft can’t rely on personal insurance. In many cases, a commercial auto policy or a TNC endorsement is required–more on this in a moment.

Doesn’t GrubHub/DoorDash provide insurance for their drivers?

Good question. To a limited extent, most of these companies do provide some coverage. But there are a lot of variables and conditions that limit when the coverage applies, creating dangerous gaps. For example, drivers may or may not be covered by the app company’s insurance depending on:

  • Location (In some states—e.g. Amazon Flex in New York—app companies say drivers must carry their own commercial coverage.)
  • Time of Accident (whether or not the driver is working in between accepted deliveries)
  • Existing Coverage (whether or not the driver already carries comprehensive and collision coverage)

Clearly, these aren’t conditions the average person should be decoding and evaluating on his own. It’s important to review the fine print with a licensed insurance agent.

Can I add an endorsement to my current auto policy, in order to do delivery work?

Maybe. For those who don’t know, an “endorsement” is a type of revision or an addition to an existing insurance policy. An endorsement alters the original terms, often by adding coverage for something that wasn’t covered before.

In the case of certain rideshare and delivery apps, there is an endorsement called a Transportation Network Company (TNC) endorsement. Some insurance companies have added the option of a TNC endorsement in order to help those who drive for Uber or Lyft. These companies allow drivers to work for rideshare companies, under their personal auto policies, with the added coverage of a TNC endorsement.

Here again, you should ask a local agent if a TNC endorsement might be a good fit for your situation.