To stay safe amidst the COVID-19 pandemic, Americans are advised to stay quarantined, and that means millions of people no longer visiting restaurants. Because of this, many restaurateurs are adapting to this era of “social distancing” by offering delivery to local patrons. While this may be an excellent way to stay afloat during this challenging time, it also comes with its own set of risks to the business owner. If you’ve recently added a delivery service to your restaurant, you need to consider commercial auto insurance and other types of coverage for delivery drivers.
What Are the Risks of Offering Delivery?
Introducing a delivery service to your business makes you responsible for the safety of the driver and any damage they cause on the road. For example, if a driver causes an accident, it’s your name on the delivery vehicle and the responsibility falls to you, the owner.
This responsibility applies whether the vehicle is owned by you, or is an independent driver working for the company you own. It’s crucial to know which type of coverage applies to your unique circumstances.
Two Primary Options for Food Delivery Coverage
Before purchasing insurance, it’s crucial to understand the differences so you only get what you need. Your coverage will differ depending on if the vehicles are owned by you or if you have independent drivers using their own vehicles.
Consider these two types of coverage that cover delivery drivers in different situations:
Commercial Auto Insurance
Many businesses choose to brand their own fleet of vehicles that they use for deliveries, and commercial auto insurance will cover a wide range of accidents involving these vehicles. With this type of insurance, only the cars you own are covered—not personal vehicles.
The span of coverage provided by commercial auto insurance includes the following:
- Protection to compensate for damage to the vehicle
- Any costs involving medical injuries that occurred in a company vehicle
- Property damage caused by an accident related to the vehicle
- Legal expenses related to accidents caused by your driver
To decide whether you need commercial auto insurance or another type of insurance, simply determine whether your company owns the vehicles you use or if personal vehicles are used instead. If the latter is true, then you may need hired and non-owned auto insurance.
Hired and Non-Owned Auto Insurance
If your company allows drivers to use vehicles that are personally owned rather than owned by the business, the appropriate type of coverage is hired and non-owned auto insurance. This type of insurance also covers vehicles that are leased or rented.
If you have questions related to which type of insurance you need for your delivery service, our agents at King Street Agency can help you make the right choice.
Should Self-Employed Drivers Get Commercial Auto Insurance?
It’s not just restaurant owners that should invest in commercial auto coverage—drivers for companies like Uber Eats that require people to use their personal vehicles may need it as well.
In this situation, personal auto insurance may not be enough. If the driver gets into an accident but it’s discovered that they use the vehicle for delivering food or other work purposes, a personal auto claim may be denied.
Therefore, if you’re an independent driver using your personal vehicle for work purposes, the only way to be safe is to purchase commercial auto coverage.
It may be an easy detail to overlook, but purchasing the wrong type of auto coverage can cost you down the line. If a wreck, fender-bender, or other accident occurs, only the right type of coverage will prevent thousands of dollars in expenses and court fees.
Find the Right Type of Auto Coverage at King Street Agency
Adding a delivery service to your restaurant may be a smart decision in this trying time. But anytime vehicles are involved, there’s the potential for accidents. Luckily, we have the coverage you need to make sure your vehicles and business are protected, including commercial auto insurance and other types of coverage for delivery drivers. Contact us today to schedule an appointment with our friendly agents. We know the needs of Charleston entrepreneurs well and take pride in serving the local community.