Using Your Car Insurance as a Pizza Delivery Driver

Pizza delivery driver carrying a stack of pizza boxes from a store.
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If you drive a car as part of your job as a pizza delivery driver, you want to make sure that you have the proper insurance coverage to protect you if you should be involved in an auto accident. Say you’ve just had a weekend job delivering pizza. One late night you accidentally rear-end the car in front of you at a red light. Thankfully, no one was injured, but both cars are damaged. You were definitely at fault, but have collision coverage on your vehicle, so you know the cost of repairs to both your and the other car will be covered—or so you think.

When you call your insurance agent to file an insurance claim, they say they are sorry but because you were using your car for business purposes, you’re not covered by your policy.

Driving Under Personal Insurance Coverage

Whether you are or are not covered for work-involved accidents will depend on the specific language of your auto insurance policy. Though you may not think of it that way, pizza delivery is a risky business. The United States Bureau of Labor Statistics found in 2018 that delivery and other sales jobs involving driving is the 5th most dangerous job in the country.

If you have a personal—as versus business—auto coverage policy, you could be on the hook for damages A personal auto insurance policy is meant to be just that, coverage for one's personal driving needs. Delivering pizzas—for which you are being paid—is not considered "personal use" by most insurers.

This applies not only to pizza delivery but to other types of delivery as well, such as drug store deliveries and even transporting people—such as Uber and Lyft. Pretty much any enterprise where one uses their personal vehicle for a commercial purpose will not fall under the personal coverage umbrella.

The reason is simple. Insurers know that drivers operating their vehicles for commercial purposes spend significantly more time on the road, which means a substantially higher risk of being involved in an accident. And that, in turn, means additional costs for the insurer.

Even if you are driving a car belonging to another person who only has personal auto coverage, the same thing will apply. While a student may be covered under their parents' policy for an accident that occurs while driving their car for personal reasons, that coverage will not extend to your use of their vehicle for a commercial purpose.

Bearing the Cost of Pizza Delivery Accidents

If you want to make substantial changes to the use of your insured vehicle—like making deliveries or transporting people—you are required to notify your insurance provider. When you do, your insurer may warn you of two items. First you will not be covered when using the car for commercial activities. Secondly, they may completely invalidate your policy, even for personal use.

If you decide to use your car for commercial endeavors—whether you inform your insurer or not—and are involved in an accident, you will be responsible for all costs involved. Any claims you make for damage will be denied.

Lying to the Insurance Company

Don’t even think about lying. During the claims adjustment process, the insurance company will do a thorough background review of you and the accident circumstances. You can be sure that any accident in which they find evidence of business activity will be one that they will be happy not to cover.

Also, if an accident report is taken by the police, you can be certain that it will mention what you were using your car for at the time. You can be just as certain that a copy of that report will find its way to your insurer.

Even if no police report is taken, you still won't be off the hook because the other driver is bound to tell their insurance company and that company will pass the information onto your insurer.

Besides denying coverage for the accident, they may very well cancel your policy. In many states, denial of coverage from your insurer for an at-fault accident could also lead to a revoked driver’s license.

How Do I Get Insured?

There are a few possibilities for getting the necessary coverage for your driving delivery or transporting people.

Coverage Through Your Employer

Some employers—particularly chain and larger independent restaurants—provide coverage called hired and non-owned vehicle liability insurance for their drivers. This policy covers their drivers when they are using their personal vehicles for work-related activities. Be sure to ask your employer if this type of coverage is available.

Commercial Insurance

The most common insurance choice will be to switch over to a commercial vehicle policy. Check with your insurance company and other drivers where you work to find out what's out there. In most cases, a commercial policy will cost more than a personal one, but the difference in price may be manageable. The key here, as with most things involving auto insurance, is to shop around.

Pizza Delivery or Uber Driver Insurance

Okay, it's probably not going to be called "pizza delivery insurance," but there are a few insurers out there that do offer special policies, or supplemental coverage to a personal policy, specifically for delivery persons.

Uber offers Driver-Partner coverage at a fee. The coverage is valid and active when the app is on. Lyft also offers help to drivers for contingent liability coverage when the app is in driver mode.

Again, talk with your agent and your fellow drivers about what's available.