Sara Routhier, Managing Editor of Features and Outreach, has professional experience as an educator, SEO specialist, and content marketer. She has over five years of experience in the insurance industry. As a researcher, data nerd, writer, and editor she strives to curate educational, enlightening articles that provide you with the must-know facts and best-kept secrets within the overwhelming worl...

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years (BBB A+). He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like and Safeco. He reviews content, ensuring that exis...

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Oct 21, 2020

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Summary Stats for Food Delivery Drivers
SummaryDetailsFrom Experts...
Food delivery marketProjected to grow 12 percent per year through 2023Forbes
Number of American Employees killed in "transportation incidents," 2016-20174,106U.S. Department of Labor
Number of American employees killed as the result of "falls, slips, and trips," 2016-20171,736 deathsU.S. Department of Labor
Business auto insuranceCoverage costs an average of $304.83/monthQuadrant
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Food delivery auto insurance coverage is important to understand. Seventy-nine percent of Americans buy what they need online — often with just a few taps on their smartphone. That’s a drastic jump from the 20 percent that shopped online back in 2000.

Food delivery is projected to grow by 12 percent every year through 2023. Just think what that market will look like considering the $30 billion in delivery sales U.S. restaurants made in 2015.

We can have just about anything — from a toothbrush to a hot meal — arrive at our front door thanks to Amazon, UberEats, Grubhub, and millions of restaurants and businesses (wisely) jumping on board.

But, who makes this impatient, demanding dream of ours a reality? The often overlooked, under-appreciated delivery drivers.

So what about delivering food and auto insurance? Do you need special insurance to deliver food?  Or will your auto insurance cover a car accident while delivering food for Postmates? Is food delivery driver insurance more expensive?

Learn how to find the best insurance for delivery drivers, and how to find the cheap auto insurance rates online.

Okay, time to dig into this growing business and give you the fast (and complete) facts you need so you don’t go bankrupt trying to make a few bucks!

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Table of Contents

Food Delivery Auto Insurance

On average, U.S. delivery drivers only make $13.82 an hour (as of January 2019), which isn’t much especially once you factor in the monthly costs we all face. Here are the 2017 averages from the U.S. Department of Labor:

  • Housing – $1,657
  • Food – $644
  • Healthcare – $411

And that’s not to mention the extra miles and vehicle wear and tear drivers put on their cars to make all those precious deliveries possible.


We understand why you don’t want to spend your hard-earned money on auto insurance. But, auto insurance is required in nearly every state, and breaking the law is the biggest mistake you could make in the business world.

That’s not all. Personal auto insurance — the minimum insurance required by law — is usually not enough for delivery drivers. Instead, business auto insurance may need to be added to an existing policy.

Do I really need business auto insurance coverage?

Here are some real-life examples to help you know the type of auto insurance coverage you need:

Personal VS. Business Auto Insurance Uses
Driving to pick up lunch for you and your co-workersDriving to deliver food to paying customers
Driving to your job siteHauling tools and equipment to your job site
Going on weekend road tripsMeeting work clients and visiting job sites
Driving friends to the airportDriving paying customers to the airport
Using your car for business less than 3 times per monthUsing your car for business 500 miles a week or more
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It should be pretty clear now…what category do you fall in?

Is your business use under 100 miles a day and three times a month? Then personal coverage is probably enough but confirm with your provider because every policy is different.

What happens if I use my personal policy for business use?

It’s not a big deal to just fib a little on how much you are using your car for business purposes, right? WRONG!

Here are just a few reasons why lying to your auto insurance provider about insurance for a food delivery service will only hurt you:

  1. When a claim is filed — think accident of any kind — insurance companies do thorough research before they pay. If you were using your vehicle to deliver say pizza, Chinese food, or a nice couple to the stadium (for money) your provider will find out.
  2. Accident reports are taken by the police. All witnesses and people involved in the accident are questioned. If you were transporting paying customers or delivering food, those key details will be in the report. But, what happens with auto insurance if a car is damaged – can you file an insurance claim without a police report? You’re good, right? Nope! Everyone involved in the crash will be filing a claim with the specifics of what you were doing, and again — your provider will find out!
  3. What happens when your provider finds out you were using your vehicle for business on personal coverage only? Car insurance companies will deny your claims. When your coverage is denied and you are at-fault you will have to cover all medical bills and damages out-of-pocket and (in almost every case) you’ll lose your driver’s license.

Your insurance provider is like your best friend — there for you when you need them — until you withhold information or lie to them, thereby committing auto insurance fraud. See, it’s really not a friendship; it’s a business. They aren’t going to pay if they don’t have to. If you get caught in a lie, that’s on you.

Ask yourself: Is saving a little money now worth going bankrupt later? Is one mistake while making one delivery worth losing your job and freedom to drive?

Take a look at this video for an example of this.

After all that, once you finally get your license back and (hopefully) find a new company that will insure you, you’re going be stuck paying much higher rates:

“The National Insurance Crime Bureau estimates the direct cost to you at around $200–$300 per year extra tacked onto your rate. The indirect costs are likely to be far more than that, estimated at around $1,000 per family according to the Texas Department of Insurance.” — Fox Business

Those extra costs won’t be getting you any extra coverage. You’re going to be charged more for the same, basic coverage simply because you no longer are on their low risk, trusted customer list. Oh yes, insurance companies have every right to do that.

How much more will I have to pay for business coverage?

Now that we know who needs business auto insurance coverage, let’s discuss the cost.

Plain and simple: Business coverage is more expensive than the basic personal auto plan. Here’s a visual comparison:

View as image

We’ve listed the driving record, vehicle, company, and personal profile used to obtain the above rates at the end of the article.

Don’t get too caught up in the price difference. Clearly upgrading to business auto coverage is going to cost more money. But, when you take the honest route in the insurance world, the money you put towards your insurance pays you back!

Business coverage is going to safeguard your job and your investments!

What does a food delivery driver business auto insurance plan cover?

A personal or standard auto policy covers you and your vehicle for social use and for basic commuting to and from work.

On the other hand, a business plan will cover you while you’re traveling long distances to various job sites, hauling equipment or tools, delivering goods, transporting people, and making sales.

Just to be clear: A basic, personal auto insurance plan will not cover you or your vehicle for any sort of extended or direct business use, which most certainly includes a food delivery job.

So auto insurance for Shipt drivers and Postmates auto insurance are two examples of what would fall under a business, rather than personal, auto insurance policy.

Here’s how Insurance Information Institute (III) plainly puts it:

“Do not expect to rely on a personal umbrella policy for any claims that arise from business use of a vehicle. Typically, the personal umbrella excludes all claims occurring in the course of a business endeavor.”

There are various levels of business coverage you can purchase depending on the number of drivers you need on your plan, the travel miles required, and the type of vehicle you’ll be driving. All of these factors will determine your rates and coverage amounts.

Why is business auto insurance coverage more expensive?

You have to pay more to get more coverage. Plus, in the insurance world, higher costs almost always boil down to two words: risk and liability. With every extra mile you drive, you are a higher risk and increased liability to your insurance company.

The U.S. Department of Labor reported for 2017: delivery, truck drivers, and car salesmen had the most deaths on the job of any civilian occupation.

In this case “deaths on the job” means traffic accidents, which is no huge surprise since there are six million automobile crashes in the U.S. on average every year.

Individuals who drive while on the job are at a higher risk to be injured or killed in a traffic accident. Insurance companies know this all too well.

In the article, “Delivering Pizza Is One of the Most Dangerous Jobs in America” you’ll find some shocking stats including:

“In 2014 alone, at least 20 pizza delivery drivers were shot in the US…We’re talking about a semi-thankless profession, in which solitude is the biggest bonus. Tips are nice, but odds are you won’t clock more than $100 per night. Not to mention, you’re wearing down your own vehicle, and opportunities for career advancement are slim.”

Working a job that requires driving puts you at a higher risk than many professions.

Be sure to lock down a solid commercial auto coverage with one of the best commercial auto insurance companies that will cover damage and hospital bills before you hit the road — and hopefully nothing else — on your next shift.

What is the difference between business and commercial coverage?

Many consumers — and sometimes even providers — use the terms business and commercial interchangeably, but they technically carry a different meaning. Insurance can be so confusing, huh? That’s why we’re here to help.

Commercial auto insurance coverage is a step up from an individual business plan. Think of business coverage as a smaller, more personal type of commercial auto insurance plan.

Commercial auto insurance is required for work vehicles owned by the business that are driven by the company’s employees. Take a look at this video to learn more about commercial auto insurance coverage.

In addition, commercial coverage is required for specialized trade vehicles that perform tasks on the job such as cement trucks and dump trucks.

Plus large delivery vehicles, tanker trucks, and 18-wheelers are called “commercial vehicles” and require this extended coverage.

As far as price goes, commercial coverage is more expensive than a basic business policy. Again it boils down to risk.

A basic food delivery vehicle is in normal traffic situations and typically only driving to nearby destinations, while commercial vehicles are much larger and usually driving further — higher risk for damage and injury.

For example, buses and tractor-trailers are much larger than typical food delivery vehicles. The larger the vehicle the higher the cost to insure due to the increased risk of damage.

What do parents need to know about teen delivery driver auto insurance?

Parents may want to have teen deliver drivers purchase their own car insurance so that liability for accidents is limited. Speak with your agent to find out what the state requirements are and the best way to limit liability.

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Purchasing Food Delivery Auto Insurance

Now that you know if you’re a delivery driver of any kind using your own vehicle, there’s a good chance you’ll need to purchase some additional coverage, where can you find it?

Are there ever any instances where your personal policy might cover you when you’re on a delivery? Keep reading to learn more.

Which insurance companies offer auto insurance as an add-on for delivery drivers?

As you can see above, there are some delivery companies that have business insurance that covers their drivers, but it’s important for all delivery drivers (and parents of teens in the business) to realize that most do not.

More often than not, delivery drivers are held responsible for their own business/delivery auto coverage. 

Thankfully, now that delivery jobs are so prevalent across America, many insurance providers are offering delivery coverage that you can add to your personal policy at a lower price than purchasing a full business line.

There are delivery-only lines of coverage (goods or food only), policies for those providing rideshare services, and even packages that cover all on-demand services.

So which insurance companies cover food delivery? And how much does delivery driver insurance cost?

See some examples of what specific providers offer below:

  • Allstate – Rideshare coverage add-on; only for Uber, Lyft, and UberEats drivers
  • Crump Property & Casualty – Hired and non-owned delivery policies;
    Rates starting at $1,250. Minimum deductibles of $2,500
  • GEICO – Add-on coverage for any on-demand app;
    Costs about $20-$25 more a month
  • International Property & Casualty (IPC) – Hired and non-owned delivery policies;
    Up to $1 million in coverage options; rates start at $2,700
  • Progressive – Food delivery coverage; can be adjusted for busier months
  • State Farm – Food/goods delivery only add-on for about a five percent rate increase
  • Sunderland Insurance – Hired and non-owned delivery policies;
    Up to $5 million in coverage options

Exact delivery driver insurance costs will vary based on the company, coverage offerings, where you live, your driving record, and other factors insurance companies consider when adjusting rates.

This becomes clear when you look at the list again and see, for example, that GEICO offers on-demand delivery insurance, not specifically GEICO food delivery insurance, while Allstate only offers add-ons for rideshare services.

These differences will affect your purchasing decisions, as well as how much you might pay.

What auto insurance providers exclude food delivery from personal policies?

We would like to repeat: If you get in an accident while using your own vehicle covered by personal insurance while working a delivery job, your claim will be denied — you’d be hard-pressed to find an exception to this statement.

In case you like to play fast and loose, be aware that many insurance companies now explicitly state they exclude all delivery jobs from their personal coverage policies.

Beware! Allstate, GEICO, Progressive, and State Farm all make clear statements that their personal auto insurance policies do not — under any condition — cover claims made by employed delivery drivers.

Readers, please realize that even if it isn’t clearly stated, business use is not covered by personal insurance. Insurers simply do not need to pay.

What companies have commercial auto insurance that covers their delivery drivers?

Business and franchise owners typically can make their own decisions in regards to insurance, which means the auto insurance available to delivery drivers might vary from location to location.

We did extensive research to give you the most current, helpful insurance info we could find.

Check out the below chart showing which delivery businesses provide coverage for their drivers. We included 32 popular companies that provide deliveries all over the U.S.

Companies with Auto Insurance for Delivery Drivers
Amazon FlexYes
Liability: $1 million
Uninsured/Underinsured: $1 million
Comprehensive and Collision: $50,000
(if you have your own comprehensive and collision coverage)
Liability: $1 million
Uninsured/Underinsured: $1 million
Comprehensive and Collision: $50,000
(if you have your own comprehensive and collision coverage)
Amazon Prime NowYes
Liability: $1 million
Uninsured/Underinsured: $1 million
Comprehensive and Collision: $50,000
(if you have your own comprehensive and collision coverage)
Up to $1 million per accident for medical expenses
$100,000 accidental death benefit and $100,000 survivor's benefits (eligible dependents)
Accidental Disability benefit up to $500 per week
Liability: $1 million (you have to exhaust your own coverage first)
Drivers use a company truck for deliveries
Google ExpressYes
Drivers use a company truck for deliveries
Jimmy John'sNo
Olive GardenNo
Papa John'sNo
Drivers use climate control company trucks to deliver groceries
Pizza HutNo
Liability: $1 million (you have to exhaust your own coverage first)
Provides delivery through Instacart
Round Table PizzaNo
Liability: $1 million
In between trips: $50,000 per person/accident
$100,000 per accident
$25,000 for property damage
Drivers use a company car for deliveries
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Some of the companies listed above don’t have insurance policies that cover their delivery drivers as a set rule, but specific store owners can choose to provide auto coverage for their drivers — and some do.

Pizzasurance, which provides auto insurance coverage for business owners, lists Domino’s, Papa John’s, Pizza Hut, Round Table Pizza as companies it’s a “Preferred Broker” for.

Another exception to the above chart would be if business owners decided to have company cars used for their deliveries.

In that case, the business would be financially responsible for any damages or injuries caused in a traffic accident while the driver was on the clock.

Does GrubHub provide auto insurance?

Rideshare companies are not responsible for providing insurance to their delivery drivers. GrubHub does not provide insurance to its drivers; neither does Instacart, but other rideshare companies do.

Uber will provide supplemental auto insurance to cover drivers when they are using the app. And DoorDash provides auto insurance that covers damage and bodily injury to third parties hurt in an accident.

Regardless of what they provide, rideshare companies require all of their drivers to have auto insurance. If you are a delivery driver for GrubHub or another rideshare delivery service, it is in your best interest to get your own auto insurance policy.

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What Happens if an Accident Occurs While on the Clock

Your fate at this moment is based solely on one thing: were you properly insured at the time of the accident?

Remember those “Choose Your Own Adventure” books? Well, the insurance you paid for (or did you?) before the crash determines if you have a happy, prosperous or sad, broke ending to this particular “adventure.”

If you get in an accident while driving on the job…

Scenario 1 – You have only personal auto insurance coverage and no coverage from the business you work for.

  • You will likely have your insurance claim denied by your provider
  • Your insurance policy may get canceled because you used your vehicle in a different way than agreed upon with the insurance policy
  • The others involved in the crash will likely sue you and/or the business you work for to recoup the costs of their damages and medical bills

Scenario 2 – What happens if you are driving without insurance and none from the business you work for?

  • Depending on the severity of the crash and your state laws, you face losing your license
  • You and the company you work for will likely get sued

Scenario 3 – You have business auto insurance of your own and no coverage from the business you work for.

  • Your business or commercial insurance should cover the resulting damages and costs
  • Hopefully, you purchased enough coverage that you don’t have to pay anything out of pocket
  • You will likely see an increase in your rates as a result of this crash and the claims

Scenario 4 – You have only personal auto insurance of your own, but full coverage from the company you work for.

  • The coverage from the company you work for should pay for all the expenses
  • Hopefully, the business owners invested inadequate coverage and don’t get sued for more money
  • Your personal auto insurance shouldn’t be affected at all by this accident

By far the best-case scenario is number four, driving for a company that has complete coverage for all of their drivers and business vehicles. Think about that when you’re on your next job search.

The second-best scenario is number three: having a great business or commercial coverage of your own that fully covers you while you’re on the road for work. The only downside here is that you’ll likely have higher rates after you file a claim.

Auto Insurance for Pizza Delivery Drivers

You already know pizza delivery can be a dangerous job. So if you deliver pizza for a business like Domino’s, for example, rather than working for a more broad-ranging food delivery service like Grubhub or UberEats, how does auto insurance work?

Does the restaurant cover you when you’re on a delivery? For example, does Domino’s pizza delivery driver insurance exist? Or do you need to purchase your own coverage? Read on to find out.

What auto insurance coverage do I need for delivering pizza?

Most likely, your insurance company doesn’t have specific pizza delivery insurance programs or a line of insurance officially named: “Pizza Delivery Drivers.”

So you won’t be able to simply purchase State Farm pizza delivery insurance, for example, but we can guarantee they will have specific plans that meet your needs.

  • Pizza delivery driver is one of the most dangerous jobs in the country
  • Auto insurance coverage is expensive but necessary
  • Personal auto insurance coverage is not enough
  • A commercial policy provides the safest, most reliable option for both individual drivers and business owners
  • Non-owned coverage provides excellent protection for drivers and employees as well, but only when used actively and ethically
  • For both drivers and employers caution and care when buying insurance are absolute necessities

Across the U.S., most pizza restaurants do not cover their delivery drivers. The majority only require that their drivers have a license and minimum auto insurance coverage.

What’s quite concerning is that many pizza shop owners have a “Don’t ask, don’t tell policy.”

Here’s what a nationwide survey of pizza restaurant owners uncovered:

View as image

What does this mean for pizza delivery drivers? At the majority of pizza places, the responsibility to get adequate coverage for the job falls solely on the drivers.

Eighty-four percent of pizza places across the U.S. don’t require their drivers to have more than minimum coverage — and 13 percent of those shops don’t care if you have any insurance at all.

With commercial and business insurance coverage costing much more than the minimum liability plans, most pizza delivery drivers out there are saving their money and hoping for the best. As a Papa John’s spokesperson said:

“If my driver is only making $50 a week and is paying $200 extra for insurance for delivery, I don’t know how many drivers I would have.”

This is a troubling reality. Since just one accident could put the restaurant delivery driver (and his beloved car) out of business — permanently.

How expensive is business auto insurance for delivering pizza?

With $45.1 billion sales in the U.S. alone in 2018, pizza is an unarguable staple across America.

Which is why we are highlighting this round customizable, cheesy cuisine, but it doesn’t matter what you’re delivering, if you’re being paid to do it, it requires business coverage.

As discussed above, the restaurant you deliver for might not require it, but if you care at all about your vehicle and job itself, you’ll invest in business coverage.

“I think it’s important for people to know that if they have a teenager, or if they get somehow involved in the pizza delivery business that there are new exclusions in their personal auto policy that may affect them. It could mean inadvertently that they have voided all their coverage on their auto policy. It’s kind of tragic.” — American Insurance President John Sullivan

As you look at the below rates just remind yourself that a basic, personal policy most likely won’t pay a penny if you crash while rushing to make a delivery.

View as image

We’ve listed the driving record, vehicle, company, and personal profile used to obtain the above rates at the end of the article.

“Delivery service drivers are among a group of occupations with the highest fatality rate in the United States. Undoubtedly, pizza delivery is a difficult profession, but it’s not just drivers who are in danger during a crash. Everyone on the road is a potential victim.” — Crosley Law

Food delivery drivers are pressured to deliver the food while it’s hot (or cold out of the fridge/freezer), and their earnings are usually minuscule without decent tips.

The fresher the food and faster the delivery, the better their pay, which means delivery drivers are more inclined to speed and run stop signs and red lights.

Many people think it won’t happen to them — until it does. No one is immune to the dangers on the road, which is why you need to invest in auto insurance that will actually cover you when we need it most.

Good pizza delivery auto insurance is a necessity for every driver. One’s personal health and financial assets could depend on it. But the matter becomes even more complex when business transactions get involved.

Drivers-sales jobs, including pizza delivery, are categorized among the most dangerous in the country.

In fact, in 2003, named pizza delivery the fifth most dangerous job in the world out of ten, right between roofers and structural metalworkers. reports that in 2014, 20 pizza delivery people were shot while on the job.

These facts are of interest to both pizza delivery drivers and the employers they work for. If the driver uses his own car, is the pizza delivery company responsible for reimbursing him for the cost of getting in an accident?

If a driver takes a bullet to the elbow from a customer who doesn’t want to pay for his pie, can she reasonably expect that her company will cover her medical bills and lost wages?

These issues can get very complex very quickly. Here is what pizza delivery drivers and pizza delivery business owners need to know.

What does a pizza delivery driver’s auto insurance cost?

When you’re about to ink an employment contract with a pizza delivery service, among the first things you’ll want to know is whether you will be using a company-owned car or your own personal vehicle.

According to a 2008 study by the National Association of Insurance Commissioners, only 48 percent of small businesses use commercial cars and commercial auto insurance policy.

The other 52 percent rely on the vehicles and auto insurance of their employees.

In the event that the company you go to work for falls in the 48 percent category, you should know that most personal insurance will not cover you for accidents that occur while using your car for work.

They won’t cover you because your car is considered a commercial vehicle, not a personal one, once you begin using it for business and a commercial vehicle needs a commercial policy.

Your insurer will make this distinction even if you use the car for personal matters in addition to using it to deliver pizzas.

They make this distinction because it is in their best interest to keep commercial vehicle policies in a distinctly different class than personal vehicle policies because there is a risk difference.

Commercial vehicles are on the road longer, increasing the risk of a collision, and can carry specialized add-ons or equipment that drive up the cost of the vehicle, meaning it will cost the insurer more if it is damaged.

As noted earlier, pizza delivery is among the most dangerous commercial endeavors known to man. Most insurers won’t bear the risk of you doing this job while on a personal vehicle policy.

In fact, you may even find a “no pizza delivery” clause in the fine print of your current personal policy.

According to Milwaukee law firm Murphy and Prauchthauser, this type of clause is present nearly 100 percent of the time and applies to any use of your car for the purpose of collecting compensation.

What are a pizza delivery driver’s auto insurance requirements?

First of all, do not even consider delivering pizzas on your personal policy. Especially if there is a clause explicitly saying not to. You will be liable for medical, repair, and other costs associated with a car accident.

In fact, if you happen to be at fault for the accident, the other party’s insurance company can demand reimbursement from you for the claim they paid out to their client.

There is also a good chance that you will be stripped of your driver’s license and have your vehicle’s registration revoked.

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Commercial Auto Insurance Policy

If you are self-employed, you must definitely obtain a commercial auto insurance policy.

Even if you’re a one-person outfit, a good insurance company can give you simple, reasonable coverage that satisfies all the legal requirements for delivering pizzas in your own car.

You’ll work with your provider to mix-and-match options like general liability coverage, rental and downtime coverage, single-deductible options, and more.

While a commercial policy is a necessity if you are the owner of the pizza delivery service you drive for, it is optional if you work for a larger company. Big pizza delivery companies usually carry a non-owned insurance policy.

This type of policy covers employees who drive their own vehicles. The employer lists you and your vehicle on this policy, and their insurer pays out if you have an accident or injury on the job.

However, even when under the umbrella of a large pizza company, things don’t always go so smoothly. There are a number of scenarios that could occur and result in you still being uncovered when something goes wrong.

For example, several large, well-known pizza companies will tell potential employees that all they need is a reliable vehicle and insurance coverage to be hired.

The un-savvy would-be employee will likely assume that their personal coverage will suffice, but as you know by now, this is not the case. The prescribed “insurance coverage” will not be adequate unless it is a commercial policy.

If you are without a commercial policy of your own and are trusting the employer to place you on their non-owner policy, be warned that this doesn’t always work out.

Every time a pizza place adds a new driver to its non-owned policy, their rate goes up. To avoid rate hikes, some will avoid adding you and your new vehicle to their policy altogether.

Not adding you saves them a few dollars a month while they cross their fingers, hoping you never get into an accident while on the job. Of course, you won’t know you aren’t covered until it’s too late.

To mitigate this possibility, it is a good idea to have a commercial policy of your own before using your car to deliver pizzas for anyone.

However, because this is cost-prohibitive for most delivery drivers, your second-best option is to ask for proof that you’ve been added to your employer’s policy before you embark on your first delivery.

If they are slow to provide proof, or they produce none at all, seek employment elsewhere.

If all else fails, know that if your employer is not upfront with you about their insurance situation, and something happens to you or your car, they can always be sued for negligence. However, lawsuits are time-consuming and costly.

What auto insurance do pizza delivery owners need?

Pizza delivery can be a lucrative and exciting venture, but it can also be one of the riskiest. All it takes is a bad night for one of your drivers to send your reputation and your profits up in smoke.

Making sure you and they are protected in the event of an accident should be among your highest priorities.

If you provide company vehicles for your employees to drive, commercial auto insurance coverage is a must for the following reasons:

  • It protects you from costly damages should your employee have an accident on the job using one of your vehicles.
  • It provides protection in the event that a worker files a claim against you for a car accident-related injury.

Like pizza, commercial insurance plans are available with a number of add-ons.

Your mix of insurance products is fully customizable and depends on the type and value of your assets, the number of employees you have, how much coverage you want to buy for them, and other factors.

The result is an insurance package uniquely designed to suit the needs of your business. Let’s take a look at some examples of these coverage options below:

  • Any Auto Liability – This liability insurance coverage applies not only to your current vehicle fleet but also extends to any new commercial vehicles you purchase and to any personal vehicles your employees use to perform their jobs.
  • Business Interruption or Rental Reimbursement with Downtime Insurance – This applies when one of your commercial vehicles goes down. It reimburses you for the cost of a rental car to replace the inoperable vehicle or for lost revenues you incur as a result of not being able to use the vehicle.
  • Single-Deductible Options – Say your pizza delivery cars come equipped with a special, heated compartment that keeps the pies warm during deliveries. You need coverage for both the vehicle and the compartment (considered special equipment) in case something happens to either or both.
  • Collision Coverage – Collision covers the cost to repair the car after an accident. If the car is totaled, this coverage pays the cost to replace it.
  • Comprehensive Auto Insurance Coverage – This insurance option applies to any damage your commercial vehicle sustains in a non-collision event. For example, if the vehicle is damaged by an act of God, such as a hail storm, you’re covered for the cost of repairs.

Commercial vehicle insurance is often included as part of a Business Owner Package or Business Owner Policy (BOP). A BOP is any custom, commercial insurance package that uses some combination of liability coverage and property insurance.

Talk to your insurer about getting a BOP for your business.

What about non-owner auto insurance?

Even if you don’t have a single commercial vehicle in your fleet, you can still run a successful pizza delivery business and you still need auto insurance coverage.

When you opt to have all of your delivery drivers use their own cars for work, you need non-owned auto insurance coverage.

Also known as excess non-owned or hired non-owned, this type of auto insurance protects you from liability for one million dollars or more in damages or injuries caused by your employee’s on-the-job car accident.

With this type of policy, your employee’s personal insurance company is solely responsible for covering the accident claim, even if the accident occurred while they were delivering pizza for your company.

Be advised that, although their insurance may payout, it most likely will not. If your employees cannot get their car repaired, they aren’t likely to return to work, and you may need to hire someone to replace them.

Any injuries they incur should be covered by your worker’s compensation insurance.

If your driver gets into an accident on the job in their own car, and you have failed to place them on a non-owned policy, responsibility for the damages could fall back on you.

Regardless of whether the driver’s personal insurance pays their claim, they could still bring legal action against you for taking for granted that they would do so.

The employee would be within their rights to do this because, as a business owner, it is your responsibility to have insurance. Failing to get it constitutes negligence.

The cost to defend yourself against the suit will likely outweigh any money you saved by failing to insure your driver.

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Auto Insurance and Food Trucks

What about food truck insurance coverage? According to NOLO, most states require food trucks to have a business license and be inspected by the health department.

What about insurance requirements? Since food trucks are technically vehicles, auto insurance is required, but what kind and how much? Take a minute to read through the next couple of sections to find out more.

What auto insurance coverage do I need to drive a food truck?

Attention food truck drivers. One of the top providers in the nation, Progressive, has a division of their company (and official website) dedicated to their commercial auto insurance coverage. Progressive Commercial offers a specific line of coverage called “Food Truck Insurance.” 

Every company and auto policy is different, but below is a helpful chart showing examples of specific food-on-wheels businesses that will require this type of coverage.

Food truck Insurance- Business that need it

When it comes time to purchase a commercial or business insurance policy, ask yourself what value you attach to each of the essential elements of your business. What would you pay to protect what’s necessary to fuel your success?

Don’t let the years of dreaming, planning, and financing your business all go down the drain in a single instant — without sufficient insurance, all it will take is one accident or injury.

Below are examples of types of business policies you’ll need (or at least need to consider) for your food truck business. The rates listed are minimum annual estimates. 

Food Truck Auto Insurance
Lines of Insurance to Protect Your Food Truck BusinessCoverageRequiredAverage Annual Rates
Commercial Auto InsuranceDamage and liability claims due to a traffic accident involving the food truckYes$1,200+
Workers' CompensationMedical bills and lost wages for employees who are injured on the job — usually covers legal feesYes (most states)$1,400+
Property InsuranceThe food truck, attachments, and equipment in a collision or theftNo$500+
General Liability Insurance Injury and property damage relating to the business i.e. food poisoning or customer getting burntNo$500+
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Keep in mind, the rates vary greatly depending on the type of food truck, value of your business, number of employees, state requirements, and much more.

How expensive is commercial auto coverage for a food truck?

Hate to break it to you, but insurance to protect you, your food truck, your equipment, your employees — your entire business model is a MUST…and it’s gonna cost you.

When it comes to the food truck industry, insurance is a vital piece to your business-planning puzzle.

Since the above non-specific rates we provided were the absolute minimum, we wanted to give you some specific rates based on actual facts.

Check out the state, driver profile, insurance provider, and business specifics listed at the end of the article — your factors might be very different, but this at least shows you what an actual food truck owner in a real-life scenario pays.

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Do those rates seem crazy high to you? Certainly, a bigger jump in price than the coverage pizza delivery drivers need.

Three things you must realize about the commercial coverage food truck rates shown above:

  1. The above rates are for a food truck valued at $200,000 – this is a no joke business vehicle
  2. This is insurance for a large vehicle with explosives inside: a kitchen on wheels. Talk about risk
  3. These rates come straight from Progressive Commercial for a food truck in South Carolina

Use our free tool to see what the cost would be to legally drive your food truck on public roads where you live.

Auto Insurance for Catering

You know by now that any sort of food delivery business requires insurance; but how does it work for catering?

Once again, you’ve come to the right place. We’ve got all the auto insurance information you need for your catering business in the next few sections. Take a look.

What auto insurance coverage do I need for catering?

Catering in the U.S. is a massive, rapidly growing industry famed for tactfully dishing out amazing food — exactly when and where you need it — and it’s bringing in impressive amounts of dough.

In fact, from 2013 to 2018, the catering industry in America grew by 1.8 percent — reaching a revenue of $12 billion. During those five years, catering businesses grew by 3.5 percent and the number of employees increased by 3.3 percent.

Do you know what can turn out the lights on your catering business in just a matter of days?

An accident involving any one of the drivers transporting food or equipment — an accident where the driver and/or vehicle aren’t covered by a business auto insurance policy.

Accidents happen, and they likely won’t harm your business when you do the responsible thing and get the required commercial coverage before it’s too late.

One thing that’s guaranteed, insurance providers aren’t going to pay for a claim if they don’t need to. They will investigate. It’s easy for them to determine that the vehicle was being used for a business purpose at the time of the crash.

Don’t risk it, or you’ll regret it.

Are you a catering business owner or an employee of the company? That makes a huge difference in the type of auto insurance policy you need.

The catering business owner has a long list of insurance policies to consider for protecting his/her business.

Likely, the Business Owner’s Policy (BOP) will cover their employees when they’re driving on the clock. As the employee, make sure you fully understand the coverage (or lack thereof) before you hit the road on the job.

As a catering business owner, there are many laws you’ll need to know like the back of your hand.

How expensive is auto coverage for catering drivers?

The U.S. Department of Labor reported that accidents relating to transportation accounted for more deaths than any other type of on-the-job injury.

There were 4,160 American employees killed in “transportation incidents” from 2016 to 2017.

In those same two years, the next highest cause of fatal injury on the job was “falls, slips, and trips” accounting for 1,736 deaths — 42 percent fewer fatalities.

The crash stats prove the most dangerous job you can do involves transportation. Insurance companies know all to well (confirmed by claims) that those who drive for work are at a higher risk for deadly collisions.

Unfortunately for catering drivers, with increased risk comes higher rates.

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We’ve listed the driving record, vehicle, company, and personal profile used to obtain the below rates at the end of the article.

If the catering company owners don’t have a BOP that covers their drivers, at least the business coverage for catering is typically much cheaper than it is for pizza delivery.

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Food Delivery Auto Insurance for Businesses

What about business auto insurance, compared to the insurance coverage the delivery drivers are required to carry? Is there a difference?

Do some companies purchase policies that cover their drivers? What happens if you’re in an accident while out on a delivery?

We know these questions can be difficult to answer on your own, so we’ve got you. Read through the next few sections to get the answers.

What’s the auto insurance coverage needed for employed drivers versus business owners?

The biggest difference here is that business owners need to invest in coverage that protects their business.

The business owner has more than just auto coverage to worry about such as property insurance, workers’ compensation, liability insurance, and more.

On the other hand, the driver just needs to be sure he or she is covered in the event of a crash while on the clock.

If the business owns the vehicle — it doesn’t matter who is driving the car — a personal auto loan will not cover that vehicle. A vehicle owned by the business must be covered by business insurance.

Again, an established business will (should) have a complete BOP, and that insurance plan should include business auto insurance that covers employed drivers.

Essential Takeaway: Before you accept a job that requires driving, get full details on the business’ insurance coverage. Don’t worry, it’s not rude or offensive in any way.

As the employee, you are legally required to have those insurance specifics as they directly affect your safety and financial stability.

The company owners will be impressed that you’re responsible enough to care about such important matters. You’ll outshine the interviewee who’s focusing on the dress code.

Plus, if one of their employed drivers isn’t insured and gets in a crash, their business will likely get sued.

How Auto Insurance Rates and Rate Increases Are Determined

Our team of expert auto insurance analysts collected annual rates for delivery drivers from a top provider in the U.S., Progressive, using the following specific profile details.

Food Delivery – Personal Only Versus Business Only Versus Business + Personal Rates

  • Profile – single 45-year-old male, homeowner, bachelor’s degree, employed: food delivery, no tickets or accidents in the last two years, licensed three or more years
  • Insurance – insured with the same company three or more years, no lapse, current bodily injury limits $100k–$300k
  • Vehicle – 2016 Honda Accord EX, four-door, owned, 12,000–15,000 annual miles driven
  • Location – South Carolina, 29687

Pizza Delivery – Personal Only Versus Business Only Versus Business + Personal Rates

  • Profile – single 45-year-old male, homeowner, bachelor’s degree, employed: food delivery, no tickets or accidents in the last two years, licensed three or more years
  • Insurance – insured with the same company three or more years, no lapse, current bodily injury limits $100k–$300k
  • Vehicle – 2016 Honda Accord EX, four-door, owned, 12,000–15,000 annual miles driven
  • Location – South Carolina, 29687

Food Truck – Personal Only Versus Business Only Versus Business + Personal Rates

  • Profile – single 45-year-old male, homeowner, bachelor’s degree, employed: food truck, no tickets or accidents in the last two years, licensed three or more years
  • Insurance – insured with the same company three or more years, no lapse, current bodily injury limits $100k–$300k
  • Vehicle – 2016 Honda Accord EX, four-door, owned, 12,000–15,000 annual miles driven (for personal and personal + business)
  • Food Truck – Valued at $200,000
  • Location – South Carolina, 29687

Catering – Personal Only Versus Business Only Versus Business + Personal Rates

  • Profile – single 45-year-old male, homeowner, bachelor’s degree, employed: food delivery, no tickets or accidents in the last two years, licensed three or more years
  • Insurance – insured with the same company three or more years, no lapse, current bodily injury limits $100k–$300k
  • Vehicle – 2016 Honda Accord EX, four-door, owned, 12,000–15,000 annual miles driven
  • Location – South Carolina, 29687

You can see that your rates increase significantly if you are a delivery driver, drive a food truck, or caterer.

There you have it. Delivering food and need auto insurance? If so, make sure you get the best insurance rate by entering your ZIP in our free quote comparison tool.