A Driver’s Ultimate 2022 Guide to DoorDash Insurance Coverage
Whether you join to pick up some extra cash or to work full-time, DoorDash is one of the best food delivery services with which to earn money as a delivery driver.
It’s available in many cities and not hard to get into the system as a driver.
However, since you’re using your car, that means that car insurance becomes critical.
Insurance protects you against when the worst-case scenario happens.
If you’re not sure what kind of insurance you need to deliver with DoorDash, you’re not alone.
This guide explains what DoorDash insurance offers and what you can do to ensure you’re protected.
The Standard DoorDash Insurance Coverage for Drivers
DoorDash doesn’t offer standard car insurance.
Instead, they offer something called liability insurance.
This insurance covers the company when an accident happens.
DoorDash’s website calls this insurance “auto insurance,” but that doesn’t explain everything.
DoorDash also explains that this insurance only works after your auto insurance is contacted.
So, after an accident, you’d go through your own insurance first and then DoorDash’s coverage for liability coverage if needed.
But, this limited coverage is still some of the best coverage for food delivery drivers.
Other delivery services, like Uber Eats and GrubHub, don’t offer any liability coverage at all.
This means that DoorDash is a good choice if you cannot afford huge auto coverage plans.
It’s not an insurance replacement, but it’s better than nothing.
How Does Insurance Work for DoorDash Drivers?
Auto insurance as a DoorDash delivery driver doesn’t work the same way as other drivers.
This is because of how many insurance companies handle their personal auto policies.
Most insurance companies will offer personal policies that cover most things.
However, delivery driving is one of the many exceptions you’ll usually see in your policy’s details.
That means if you get into an accident while doing a delivery, a standard policy won’t cover your personal car.
Instead, Dashers will have a few other add-ons to go over when they pick an auto insurance policy.
Those add-ons are:
- Business-Use Coverage: This add-on labels your car as a vehicle for business purposes. That means that you can insure the car while driving the car for business-related activities, such as delivering.
- Commercial Coverage: This coverage option labels the car as entirely for business use. Like the previous option, this means you can use the car for deliveries. But, the car now can’t be used for personal uses and be covered.
Both of these add-ons will increase the total cost of your insurance unless your policy covers one of these options already.
Add-ons like this aren’t standard and are more expensive for the insurance company to cover.
That’s why you’ll see the price hike up with these options.
What Does Standard Coverage Include?
Since DoorDash insurance doesn’t include auto insurance for Dashers, that means you have to pay for insurance yourself.
Since insurance will differ based on what kind of car you drive and where you live, let’s talk about what the average auto insurance policy looks likes:
According to American Family Insurance, the average deductible for auto insurance is $500.
The deductible is the amount of money you have to pay before the insurance company gets involved.
In general, it’s best not to contact your insurance if the repairs are going to cost less than your deductible.
Insurance companies tend to raise your premium if you report a repair or accident.
So, if you’re going to report something, you might as well be using your policy to help cover costs.
That way, if your premium goes up, you can say you got something out of the deal.
2. Coverage Limits
Coverage limits are the limits of the amount of money the insurance company will pay out in certain circumstances.
This is something that will differ between people.
That’s because different states will require different minimums to be considered insured.
It’s best to pay for more insurance than what most state minimums set.
Most state minimums are so low that they won’t cover most of what needs paying out after an accident, let alone everything.
In general, the 100/300/100 coverage limits are what’s considered best for a personal vehicle.
This coverage plan consists of three parts:
- $100,000 for Bodily Claims: This limits what the insurance company will pay out for bodily claims on a single individual, such as you or the other victims of the accident.
- $300,000 for the Total Accident: While also related to bodily claims, this limit instead refers to the total amount that the insurance company will pay for all claims across the accident for bodily injury.
- $100,000 for Liability Coverage: This limit represents how much money the company will pay out in property damage costs caused by the accident in question for that insurance claim.
As you can see, the numbers for the 100/300/100 plan come from the first three digits of the limits they represent.
If you cannot afford a 100/300/100 coverage plan, then downgrading to a 50/100/50 plan can still offer much better protection than most state minimums while being less expensive.
4. Other Considerations
When you review the coverage conditions for your auto policy, check and see if you’re covered while running your active deliveries.
Business uses are a common exception to many personal auto policies.
If your insurance doesn’t cover delivery driving, you may need to add a business-use or commercial add-on to your policy.
This increases the cost of your insurance.
But, this add-on covers you in the event of an accident while running a delivery.
Types of Additional Coverages to Consider Purchasing
Business-use and commercial coverage are common additions to an auto insurance policy for DoorDash delivery drivers.
This is because these coverage add-ons will fill in the gaps of your standard personal auto insurance policy.
The difference between these two options is subtle but important.
Business-use coverage refers to auto insurance that covers your car while it is in use for business activities.
For DoorDash deliveries, this will be while you are driving to pick up or drop off a delivery.
This isn’t a standalone insurance policy but instead an addition you’ll make to your personal auto insurance plan.
It’s easy to get this added to your plan, too. Just call your insurance company or insurance agent and explain that you’ll be driving for the delivery company and you need something beyond standard DoorDash insurance.
They will walk you through the steps to be covered while running deliveries.
Commercial Use Coverage
If you use your car exclusively to run deliveries, then this is the option for you.
Commercial use coverage labels a car as being used only for business or commercial purposes only.
This means that the car isn’t for personal use, so you’re not covered when you’re not driving the vehicle for deliveries.
For most people, this isn’t the right choice.
Most Dashers are looking to use DoorDash to augment their income rather than creating a business out of it.
This means that business-use coverage options are better and cheaper for the average rideshare driver.
There is also TLC insurance, which is required for rideshare drivers in states like New York.
Popular Insurance Companies for Delivery Drivers
When you get auto insurance, you want that insurance to be trustworthy and effective when the worst case happens.
The insurance industry can be confusing, so these are some of the auto insurance companies that many many Dashers choose to be their insurer:
Geico offers a Rideshare Insurance option, meaning that getting insurance for your delivery and ridesharing needs is straightforward.
Their Rideshare Insurance is considered a hybrid policy.
This means that you get this policy instead of a regular personal policy.
The insurance lets you drive for multiple delivery companies at once and is available in 40 different states.
Progressive offers rideshare coverage as an add-on for its personal auto loan policies.
This add-on isn’t offered in some states, so you may have to default to a commercial policy if this add-on isn’t in your state.
The nice thing about Progressive’s add-on is that it doesn’t affect your policy limits.
You can use whatever your limits were from before getting the add-on coverage.
But, your coverage with Progressive is secondary to the insurance you’d get from DoorDash’s liability insurance.
3. State Farm
State Farm only asks that you get a business-use add-on to be covered while using a food delivery app.
This add-on can add between 15-20% of your premium as an extra cost.
This means this add-on can get expensive for those with extensive policies for their cars.
Frequently Asked Questions
These are some of the most asked questions about insurance and DoorDash:
Does DoorDash Offer Health Insurance?
DoorDash does offer health insurance, but only to those who have been driving for a while.
You also have to receive high ratings on your deliveries.
Do You Need Commercial Insurance for DoorDash?
No, you do not need commercial insurance for your car if you get a rideshare or business-use add-on for your policy.
Does DoorDash Check Your Insurance?
DoorDash’s website states that they expect you to have a current auto insurance policy to drive with them.
DoorDash offers a great way to make some extra cash by delivering for them.
However, insurance coverage for this changes because you’re now a business user of your car.
That means that normal auto insurance won’t cover you while driving.
Understanding that and planning well can mean the difference between having coverage and not.
If you want to check out some of the other articles we’ve written on driving for deliveries, we have a whole section of our blog dedicated to those services.
Check them out and see if driving for DoorDash is the right choice for you.