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Uber Eats and Insurance: How Does Delivering Food Affect Your Coverage?

Uber Eats and Insurance: How Does Delivering Food Affect Your Coverage?

The pandemic brought a colossal increase in food delivery demand; Uber Eats alone saw a 152 percent growth in 2020 from the previous year. Even as restaurants have reopened and restrictions have lifted, the demand for fast and convenient delivery options remains embedded in the cultural landscape.

We know that a number of clients are considering or already doing GrubHub, Uber Eats, DoorDash, or other food deliveries. Let’s unpack how this might affect your insurance coverage.

Food delivery and insurance needs

Basically, you have the same principles as being an Uber or other ridesharing driver in place. We need to understand what you are using the vehicle for and where you are in that process to determine how your insurance coverage might respond.

When you work with one of these companies, there are four different situations that your vehicle can be in:

  1. You are driving it as a private passenger auto like you usually would
  2. Your app is on and “waiting” for a delivery request
  3. You are on the way to pick up the food to deliver
  4. You have the food and are taking it to the person who ordered

These stages are covered in an earlier ridesharing blog I have provided if you would like to review.

In the case of food delivery, numbers three and four are treated the same, unlike an actual Uber or Lyft with people. You are engaged in the business of delivering once you engage the app and head over to pick up your delivery.

The question becomes: Does the delivery company provide any coverage, and where does your personal auto policy fit in?

In some ways, this is even more convoluted than ridesharing. The reason is that the delivery companies are all over the board on coverage. Some have limited liability coverage while others have nothing at all. Some look at it as a livery (taxi) service, while others see it specifically as food delivery.

Your personal insurance policy

As far as your personal insurance goes, the most common situation in a policy is that it excludes food delivery. There are a few exceptions, so before engaging in any type of delivery, make sure you know your specific situation by consulting the actual policy or calling your agent. Coverage can vary significantly from carrier to carrier.

The final piece is to note that some carriers offer a TNC (Transportation Network Company) endorsement. As you may recall, most carriers do not provide coverage to those working for Uber or Lyft, so this makes it possible. If you read the endorsement, it usually provides coverage for piece #2 above: you have your app on and are looking for a ride/delivery, but you are not directly on the way to or from a delivery.

The bottom line? Make sure to do your homework before taking on the exposure of food delivery. It may not be worth the extra money. Contact your agent with any questions that arise.

As always, thanks for allowing us to protect your families.


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