Gig Workers: Your personal car insurance may not cover your accident during a delivery


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In 2021, 41% of respondents used side gig money to pay their monthly bills, GOBankingRates reported. Additionally, 27% of construction workers surveyed spent more than 15 hours a week on their hustle side, up from 12% in 2020.

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The Pew Research Center reported that top gigs included driving for a ride-sharing app (like Uber or Lyft), buying and delivering groceries, performing chores and errands, delivering food (for restaurants or for an app like DoorDash), or use their personal vehicle to deliver packages.

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If you read this list carefully, you’ll see that four of the top five gigs almost certainly involve driving your own vehicle while you do the work. Household chores such as cleaning may or may not require your own vehicle.

But many people may not realize they could be taking unnecessary risks by using their personal vehicle for a side gig. Forbes recently reported that you may not have the car insurance coverage you need if you drive a personal-use vehicle while working alongside it.

Do you need commercial auto insurance while you work on the side?

A common problem construction workers face is not having commercial auto insurance if they use their personal vehicle to earn money. Motor insurers consider “business use” of a vehicle to be riskier than personal use; those who drive for work may spend more time on the road and be in a rush to reach their destination. Without commercial auto coverage, you may not be able to file a legitimate claim if you are involved in an accident.

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In 2020, according to the Bureau of Labor Statistics, 1,778 fatal work injuries occurred among drivers/salespeople, accounting for 37.3% of all work-related fatalities. In another study by the Worker Institute at Cornell University, 49% of delivery drivers using an app said they had been involved in an accident or collision. Seventy-five percent of those injured said they had to pay for medical treatment out of their own pockets, according to the survey, because construction workers are not entitled to workers’ compensation for illnesses or injuries on the job.

If your side job involves driving your personal vehicle, you’ll want to know if your employer provides insurance. If not, check with your insurance company to see if you need additional insurance coverage.

If your employer covers your insurance, is there a gap?

Even if your employer has an insurance policy that covers you in the event of an accident while you’re making a delivery, it may not cover you if you’re driving to pick up a restaurant order. If you don’t have appropriate private coverage, your employer’s insurance company could also deny the claim, according to Forbes.

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Does your company offer car coverage?

Policies vary widely between delivery companies and apps. According to Forbes, Uber and Amazon Flex offer commercial auto insurance to all drivers except in New York State, where drivers must obtain their own coverage.

Postmates and DoorDash have “excess” policies, which go into effect once your own policy limits have been exhausted.

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Instacart and GrubHub require drivers to have their own car insurance, which means you should check with your insurance company if you need a commercial policy.

Policies can change at any time, so it’s important to check current requirements before accepting a gig that requires driving, whether you’re delivering food or transporting people.

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About the Author

Dawn Allcot is a full-time freelance writer and content marketer with interests in finance, e-commerce, technology, and real estate. His long list of publishing credits includes Bankrate, Lending Tree and Chase Bank. She is the founder and owner of GeekTravelGuide.net, a travel, technology and entertainment website. She lives in Long Island, New York, with a veritable menagerie that includes 2 cats, a rambunctious kitten and three lizards of different sizes and personalities – plus her two children and her husband. Find her on Twitter, @DawnAllcot.

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