Ok man, let's rug-roll this rideshare and delivery driver insurance talk.
Some of you cats are probably pondering if your regular insurance covers you when you're cruising the rideshare or delivery scene, right?
Well, the straight-up answer is no, but the whole deal is way more complicated, you know? It’s so complicated, that right now, in 2024, insurance companies, rideshare and delivery outfits, and the state regulators are still figuring this out, man.
But look, I’m here to simplify the complicated so you don’t waste too much time. Keeping first things first, let's lay down some lingo.
The Lingo
Rideshare companies and delivery companies, respectively and collectively, are called Transportation Network Companies (TNCs) and Delivery Network Companies (DNCs). TNCs link people with other people so people can get to where they need to be, and DNCs link sellers with buyers, getting goods delivered where they need to be.
Why doesn't my policy cover me when I'm doing rideshare or delivery?
When you bought a personal auto policy, did you expect the insurance dudes to cover you when you're not using your car for personal reasons? Some people might expect this, but it's just not how insurance works.
When you grab a personal auto policy, the insurance dudes assess your risk level, lump you in with some similar cats, and hit you with a premium to keep their company's wheels turning.
When you switch gears and work for a TNC or DNC, it's like changing lanes without a signal, man. Your insurance company was expecting one thing, and you did something else. That said, they kind of thought this might happen anyway, so they put exclusions in your policy saying they won't cover your damage (or damage caused by you) when they find out you're rolling with a TNC or DNC.
How do I make sure I'm covered?
The first step to making sure you're covered is to add collision and comprehensive coverage to your auto policy. This gives you peace of mind when you're cruising for personal reasons, and it helps you meet the contingent coverage requirements of the TNC and DNC insurance companies.
"Contingent" basically means "if", so "if" you don’t have collision and comprehensive coverage on your auto policy, the TNC or DNC isn’t going to step in and help with your damages, even if an accident happens on company time.
As for coverage provided when you injure someone else or damage someone’s property on company time, you’ll typically get excess bodily injury coverage of around $25,000 per person and $50,000 per accident, as well as property damage coverage of $25,000 per accident. Some other companies provide combined single limits (CSL) coverage of $1,000,000 to cover all property damage and injury claims related to an accident.
Whatever the coverage is, it's typically considered excess, meaning the TNC or DNC's insurance company won't pay until other insurance companies (that might also have coverage for the accident) run out of money under the coverage limits or deny the claim.
It can take a while for the insurance cats to figure this out, so make sure you keep your costs down as much as you can.
On a side note, some companies don’t provide coverage at all. Look, I encourage you to do your research before believing me, but it looks like Grubhub and Instacart do not offer coverage to their drivers.
No matter who you roll with, it's worth getting on the phone with your insurance agent or your insurance company and making sure you have the coverage you need. They'll help you hash things out without leaving you feeling like you're stuck in traffic.
Wrapping this all up, I don’t know if you’re rocking a sweet side hustle or rolling with a main gig but keep cruising.
Comments