If you’re wondering what to do about car insurance coverage when making a DoorDash delivery, you’re in the right place.
Having more than personal car insurance for auto coverage while driving and making deliveries would be best because DoorDash deliveries are considered business use.
So, what kind of DoorDash car insurance policy do you need?
When you’re done reading this post, you’ll have the answer to that question and understand what kind of special insurance you need for DoorDash.
What Does DoorDash Coverage For Delivery Drivers Include?
Making a DoorDash delivery is considered “business use” because you use your car to make money.
If you don’t let your car insurance company know that you use your car for business, you take a considerable risk. Your personal auto insurance policy will not cover you if you get into a car accident while on delivery. They might cancel your car insurance policy, meaning you would be responsible for vehicle damages and medical costs and become instantly uninsured.
So, what should delivery drivers do? It would be best if they purchased rideshare insurance. DoorDash claims it provides limited coverage for drivers, but this is a stretch. In reality, DoorDash coordinates compensation with your primary auto insurance company. This is liability insurance, but that’s a stretch as well.
DoorDash never provides you with a certificate of insurance for your vehicle, meaning they technically do not offer auto insurance coverage.
Insurance compensation from DoorDash only pays for damages to a third party’s vehicle or their medical expenses. You are responsible for 100% of the damages your car incurs. Suppose you suffer an injury during a car accident. In that case, DoorDash has an Occupational Accident Policy, but that’s still not car insurance.
DoorDash will not compensate you since you must go through your auto insurance company, which could deny the car insurance claim because you were using the car for business use.
If they reject the auto insurance claim, DoorDash might cover you under their third-party liability insurance. DoorDash states that their insurance coverage is “subject to policy terms, conditions, limitations, and exclusions.”
DoorDash Insurance Requirements
In addition to meeting the driver requirements, DoorDash has specific insurance requirements that vary by state where you operate. Each state has minimum coverage requirements, so you’ll need an auto insurance policy that meets or exceeds those requirements. To determine what policy you need to get, go to your state’s DMV website for more info.
Many States have very different auto insurance laws. Most require liability coverage, which consists of bodily injury liability and property damage liability coverage.
For example, New Hampshire doesn’t require auto insurance, and Michigan has some of the highest minimum coverage requirements in the country. This shows how location affects the insurance requirements for DoorDash drivers.
Another thing to consider is whether your personal policy covers auto accidents that happen while driving for DoorDash. Many insurers don’t cover accidents during commercial driving activities like food delivery. You should talk with your insurance agent to avoid policy cancellation or claim denials and understand the specific policy terms around delivery-related coverage.
Key points to remember:
- Your personal car insurance might deny your auto insurance claim if the car accident occurs during a DoorDash delivery.
- Compensation from DoorDash kicks in after making an auto insurance claim with your auto insurance carrier
- DoorDash’s auto insurance policy leaves gaps in coverage.
- Rideshare insurance fills coverage gaps.
How Does DoorDash Insurance Work?
Let’s use Cameron’s situation to illustrate how Doordash car insurance works. Cameron accepts a DoorDash delivery and heads to the store to pick up the order. He rushes to the customer’s location and suddenly gets into a car accident. The other driver’s car has $5,000 worth of repairs and $2,000 worth of medical bills.
Cameron made an auto insurance claim with his car insurance company. However, his company denied it because he was making a delivery and needed rideshare insurance.
After filing a claim with his auto insurance company, he emailed DoorDash’s claims department. DoorDash might cover the car accident costs, but not since they have no legal obligation. Cameron is at risk of paying $7,000 out of pocket, and his insurer might drop him as a client.
As you can see from the above example, DoorDash’s auto insurance coverage isn’t a stand-alone policy or dependable. Since delivery drivers are contractors, not employees, DoorDash isn’t responsible for car accident costs.
Some conditions need to be met before you receive compensation from DoorDash, including:
- The delivery driver has an active, up-to-date personal car insurance policy.
- The delivery driver is liable for damages or injuries caused to another party in a collision while on an active DoorDash delivery.
- The delivery driver’s personal auto insurance company denied their car insurance claim.
- There must be a DoorDash order in the vehicle the DoorDash delivery driver uses.
What’s the difference between DoorDash Insurance and Supplemental Auto, Commercial Auto, and Business-Use Insurance?
Car insurance for DoorDash drivers requires supplemental auto endorsement called rideshare insurance. Personal car insurance doesn’t cover you when you activate the DoorDash app and become available for deliveries, but you do have additional car insurance options.
Supplemental Rideshare Coverage
In most states, you can add supplemental rideshare coverage to your personal auto insurance policy. While this coverage is designed for passengers, it also covers food delivery services, so you’re protected in case of an accident while dashing.
On average, Supplemental Rideshare Insurance is $10-$30 monthly on top of your regular auto insurance premium. The cost depends mainly on your driving history, which is also reviewed during your DoorDash background check.
Plus, this is tax deductible as a business expense, so it helps reduce your taxable income from dashing.
Business-Use Coverage
Business-Use Coverage is an add-on to your personal car insurance policy. You can get coverage for business use for your vehicle for a few extra dollars a month. This car insurance coverage is strict and not guaranteed. Your auto insurance company might only offer auto insurance coverage after buying a separate commercial insurance policy.
DoorDash Commercial Auto Insurance Coverage
Commercial auto insurance is an expensive stand-alone policy reserved for companies that use a car for business only. For the average delivery driver doing DoorDash, commercial auto insurance is not the best choice for their bottom line—to be protected in the case of a car accident or collision and make money.
DoorDash Insurance FAQ
What Auto Insurance Policies Cover DoorDash Drivers?
Delivery drivers need a rideshare insurance policy. Rideshare coverage fills the gaps in auto insurance coverage between your personal car insurance and compensation from DoorDash. DoorDash themselves do not have a car insurance policy that covers you specifically in the case of car accidents or collisions.
Does DoorDash Provide Car Insurance For Delivery Drivers?
Not really. It is possible to receive compensation from DoorDash, but it is unlikely. DoorDash will not give you a certificate of insurance for your auto. Therefore, DoorDash has no obligation to provide delivery drivers with auto insurance.
Delivery drivers are contractors and not employees, which is another reason DoorDash has no obligation to provide you with compensation – even though they claim to provide car insurance.
Compensation from DoorDash is not dependable and isn’t a replacement for standard car insurance. Doordash pays only if the dasher has a car accident while on an active delivery. DoorDash says an active delivery is when you’ve accepted an order and are driving to the merchant and from the merchant to the customer. DoorDash also says there has to be an order in your possession. You won’t get compensation if you have an accident without food in your car. It could be more evident.
Once a delivery order is canceled, you are no longer entitled to compensation if you get into a car accident. It would help if you were covered between DoorDash orders.
Because you are using your personal vehicle or a commercial rental, you must have personal car insurance to qualify for compensation from DoorDash. Delivery drivers must also go through their personal auto insurance when making an auto insurance claim.
When Does Coverage from DoorDash kick in?
Third-Party Auto Liability insurance coverage from DoorDash kicks in when:
- The delivery driver has an active, up-to-date personal insurance policy.
- The delivery driver is liable for damages or injuries to another party while on an active delivery.
- The delivery driver’s personal auto policy denied their claim with a coverage denial letter.
Under no circumstances will DoorDash provide compensation for damage to your vehicle. You are responsible for all damages your car incurs from a car accident.
Will Personal Car Insurance Cover DoorDash Drivers?
It is unlikely. Your personal auto insurance covers you when you’re using the car for personal reasons. Personal use means errands, commuting, and social gatherings. Using the vehicle to make a DoorDash delivery is considered business use because you’re using the car to make money as a delivery driver.
Is Business Insurance The Same as DoorDash Insurance?
No. Business and commercial auto insurance coverage is more expensive than DoorDash or rideshare insurance.
How Much Does Car Insurance For DoorDash Deliveries Cost?
- If you get rideshare coverage, which is the best option to get insured, it will cost you $6 - $30 monthly.
- Commercial car insurance costs anywhere from $600 to $2,400 per month.
- A business-use add-on policy costs up to $60 per month.
What Does DoorDash Insurance Cover?
Also known as rideshare insurance, DoorDash Insurance covers you when you activate the DoorDash app and becomes available for orders until you turn off the app. It’s comprehensive, like your personal auto insurance, except it covers you while you run deliveries for DoorDash.
Where Can I Get DoorDash Insurance?
As a leading insurance agency, Insurance Navy offers car insurance for DoorDash drivers at affordable rates.
Reaching out to one of our insurance agents can save you money on your auto insurance in minutes.
Call us at 888-949-6289 to get free cheap car insurance quotes. We also assist both in-person and virtually via our website and mobile app. Spending a few minutes getting a quote can make a real difference.
