Someone taps to order some food from their favorite delivery service app. The driver gets the order and heads to pick up the meal and to deliver it. Somewhere along the way, that driver is in an accident. What happens next?
The question seems simple enough, but due to the nature of these delivery apps, it’s more complex than you think, and depends greatly on your perspective. Let’s dig in.
Car Insurance Complications for Food App Delivery Drivers
Rideshare services like Uber and Lyft require their drivers to have car insurance, and then cover them further with a liability policy. Many states have adopted rules and insurers have created new products to cover the rapidly evolving share economy. What many do not know is that ordinary car insurance does not cover a driver working as a rideshare service.
If you read your insurance policy, for example, you’re likely to find a section that deals with “livery” or “commercial use” of your vehicle. Specifically, the policy excludes such uses from its umbrella of coverage. Drivers may be delivering food instead of people, but the underlying principle is the same.
These types of uses involve different risks to vehicle drivers and owners, and as such, their coverages will differ. This matters when a driver is not carrying the correct type of insurance for the work they’re performing. As a whole, a study by the Insurance Information Institute found that 13% of all drivers were underinsured. Given the confusion about policies and terms of service, one can safely assume that drivers working for delivery services could have a higher rate of underinsurance.
None of this matters until the driver is at fault in an accident. If you’re injured by that driver’s error, it certainly matters to you.
The Order of Insurance
When an accident happens and insurance coverage is triggered, it is triggered in a certain order. The insurance on the vehicle comes first, even if it’s not driven by the owner. So, if you’re driving your mother’s car for example, the insurance she has on her car would be primary. Your insurance, as the driver, would be secondary. Any other insurance would only come into play after those policies. If you are driving your own car, then your insurance as the driver and the vehicle’s insurance are one and the same. In the examples to follow, “driver’s insurance” assumes the driver owns the vehicle being driven.
If Delivery Driver Is at Fault in an Accident, How Are They Covered?
In this scenario, someone who is hit and/or injured in an accident when the delivery driver is at fault has a few options. The quest for compensation begins with the vehicle’s insurance. As previously noted, this may not be much help if the driver was underinsured or did not carry the correct type of coverage for the activity in which he or she was engaged.
However, most of the different services and apps seem to offer additional coverage for their drivers, though they are not created equal. And in some states, such as New York, the rules are entirely different. Generally speaking, though, here is what you can expect.
DoorDash provides its drivers with a $1m contingent liability policy. However, the policy only covers drivers “in possession of goods to be delivered.” In other words, they’re covered when they’ve picked up an order to deliver it – not when they are on their way to a restaurant or leaving a delivery. Additionally, the policy only kicks in after the driver’s personal policy is exhausted.
Drivers for GrubHub receive no additional insurance whatsoever.
Drivers for Amazon Flex have $1m in primary liability coverage including contingent comprehensive and collision coverage, and $1m in underinsured/uninsured motorist coverage. This policy covers drivers as they “deliver packages, pick up packages and return undelivered packages back to a designated location.” Some of this coverage requires a driver to have certain personal insurance in order to qualify for the benefit.
Similar to DoorDash, Postmates offers its drivers $1m in contingent liability coverage. Again, this is only used once the driver’s own auto insurance coverage is exhausted. They also include a similar policy for deliverers who work on foot or ride bicycles.
Uber Eats is a subsidiary of Uber, which is run through a company called Portier LLC. They have a commercial liability policy that covers drivers “from the moment a driver accepts the request to deliver meals or goods to the time the delivery is complete.” They also provide contingent comprehensive and collision coverage, and liability coverage for drivers who are between trips.
Why Does This Matter to You?
Well, if you’re injured in an accident and the delivery driver is at fault, you need to know how you could be compensated for the damage done to your property and your medical bills. The primary case would be with the vehicle’s insurance. The company’s policies would possibly kick in if the vehicle and driver’s insurance were insufficient.
Now, in the case that there was some sort of corporate negligence, that would enable you to go after their corporate policy without relying on that of the driver. For example, if the company was negligent in its screening of drivers, or allowed drivers to work more than a certain number of hours, that could be considered negligent.
The bottom line for you, if you’re injured by one of these drivers, is that there might be more insurance available than the delivery driver’s policy, but it can be a confusing process to try and figure out what might be available. Be aware that there is data available on the driver’s app that might show how long the driver has been driving (in case fatigue was the cause of the wreck), GPS, speed, along with other pertinent data. An experienced personal injury attorney will know how to obtain and preserve such evidence.
What If I am a Delivery Driver?
You’re in a risky business. In fact, according to the United States Bureau of Labor Statistics, delivery and other sales jobs involving driving were the 5th most dangerous job in 2018. When you go to work for these delivery services, you’ll be handed a contract, and if you read it carefully, you’ll find out you’re probably not an employee. You’re in independent contractor.
As an independent contractor, you’re on your own in a great many ways. Foremost is that you’re using your vehicle for the purposes of the delivery service. As stated above, most personal auto insurance policies specifically exclude such uses for purposes of coverage. You should contact your insurer and ask them what would be required to obtain coverage for the use you intend. The delivery service you’re working for will deny liability, because you are not an employee unless they specifically provide coverage.
If you’re in an accident and you’re relying on your regular auto insurance coverage, your claims are going to be denied. Do not expect the company to validate that you have the right kind of insurance, either. That’s entirely up to you.
And if you try to hide what you were doing, an insurance investigator is going to dig up the truth – which means you’re then on the hook for the damages AND insurance fraud. It’s not worth it. Get the right insurance!
What if I’m Driving for a Delivery Service and I’m Injured by Someone Else?
Then you’re going to go after that person’s insurance. It likely will not matter to your insurer at that point, depending on the insurance rules of your state. In North Carolina, the at-fault driver’s insurance will be the one who pays, with additional liability for uninsured and underinsured drivers kicking in as necessary.
If I’m Delivering and I Get Injured, Can I Apply for Workers’ Compensation?
The answer is probably no if you’re an independent contractor. As an independent contractor and not an employee, you’re not covered by workers’ compensation benefits in the state of North Carolina. The independent contractor agreement you sign with all of these services means you’re, essentially, self-employed.
If You’re Injured in an Accident Through No Fault of Your Own, Contact an Experienced Attorney
Let someone with the right tools and experience navigate through the maze of insurance on your behalf. Focus on getting better, and let us fight for you. The Law Offices of James Scott Farrin work hard for clients just like you. If you or someone you know needs our help, call the HurtLine 24/7 at 1-866-900-7078 or contact us online for a free case evaluation.