Does the gig economy have you considering becoming a driver for a delivery service? Driving jobs for services like Uber and Lyft have become commonplace. Now the pandemic is continuing with trend with strong demand for delivery service drivers such as Instacart, Grubhub, DoorDash, etc.
Whenever you’re using your personal vehicle for commercial work, the insurance requirements change. So does the price. Use the ValChoice car insurance calculator to see how the price of your insurance will change.
How do driving jobs affect my car insurance?
Driving jobs change the use of your car from personal to commercial. Generally speaking, this one change will increase the cost of your car insurance by approximately 15%. That applies across all types of insurance, liability, collision and comprehensive.
This isn’t the only change though. Depending on the type of driving you’re doing, driving jobs may require you to have different coverage. For example, if you’re driving people like an Uber or Lyft driver does, there are very specific requirements for you insurance. Conversely, if you’re delivering groceries, you don’t have the added liability of passengers. Read on to learn more about the other requirements.
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How does rideshare insurance differ from traditional car insurance?
Rideshare insurance is a supplemental insurance. Supplemental insurance often comes in the form of an endorsement to the current insurance policy. Coverage starts when a rideshare driver is signed into their app, and has been matched with a customer. The coverage ends when they drop the passenger off.
Should I just add and endorsement to my regular policy?
Most of the major insurance companies offer insurance for both delivery drivers and ride share drivers. The advantage of having all the insurance with one company is that only one company is responsible if you file a claim. The more companies that are involved, the more complicated claims will become. However, before buying extra insurance from a company, make sure they are good about paying claims. If they’re not good about paying claims, don’t buy any insurance from them. In addition to the claims service, make sure the coverage is good and it’s fairly priced. If you can tick the box for good claims handling, good coverage and fair price, that’s the company to buy from.
What is gap insurance and do I need it?
Gap insurance covers the difference in value between what you owe on your car and what the insurance company is willing to pay if it gets totaled. If you have a large loan on a vehicle, you should consider gap insurance.
Do I need to inform my insurance company if I have driving jobs with my vehicle?
Absolutely yes. Some companies won’t allow separate rideshare insurance and could cancel the driver when they find out they’re a rideshare driver. For delivery service jobs, being cancelled is less likely. However, if you had an accident and the insurance company finds out afterward that you were using the vehicle for commercial work, that could be a problem.
What steps should I take to get commercial insurance for my driving job?
Shop around. Make sure the companies offer similar coverage and honor their promise to protect.Before buying insurance from a company, get a ValChoice rating showing how good of a car insurance company they are.
If the company you’re considering doesn’t score well, go to the ValChoice list of the best insurance companies in each state. That way you know which companies offer great protection at a fair price.
What if the company that hires me for a driving job offers insurance?
Get insurance for your vehicle through your employer, may be good, and it may not be good. Here are four key things to watch out for:
- Is the company they contract with good about paying claims? Usually employers will contract through the largest insurers. Those companies tend not to be good about paying claims.
- You will need to monitor whether you need gap insurance. Your employer won’t care and will not monitor this need.
- For some drivers, their personal insurance company will not allow them to buy additional insurance through another company
- If the employer charges you for the insurance, you need to check to see if it’s a fair price.