Commercial Auto Insurance For Delivery Drivers In New York – Millions of Americans have changed their work, rest and shopping habits due to the epidemic. Government stay-at-home orders, doctors’ quarantine orders, and individual decisions to contain the spread of COVID-19 mean more people stay at home than before.

With the decision to stay at home, there is also a change in the methods of obtaining food and other necessary materials. Delivery drivers play an important role in making large-scale quarantines work, but they also face their own risks. So commercial insurance coverage for delivery drivers is becoming a major concern for businesses and resilient economy workers.

Commercial Auto Insurance For Delivery Drivers In New York

Commercial Auto Insurance For Delivery Drivers In New York

As the COVID-19 pandemic closed schools and businesses in March 2020, people began exploring options for delivery of food and other essentials. Apptopia’s Adam Blacker saw record downloads of delivery apps from companies offering grocery delivery, such as Instacart, Walmart Grocery, and Shipt, in mid-March 2020, for example.

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The pandemic has reduced demand for ridesharing services, but demand for food and grocery delivery has remained steady, according to a survey by the University of Chicago Harris School of Public Policy.

About 40 percent of the respondents said they used food and grocery delivery services, while 16 percent said they used these services more often than before the pandemic. While the use of ridesharing services has declined, 71 percent of respondents said they will likely start using them again within a year.

Ridesharing platform Uber has seen demand for passenger rides decline during the pandemic. But demand for deliveries from the Uber Eats initiative has doubled, reaching $1.2 billion by August 2020. Uber CFO Nelson says Uber expects Uber Eats to be profitable over the next few years, given the growing demand and Uber Eats’ acquisition of shipping company Postmates, Chai says.

The move from ridesharing demand to delivery services “is a clear example of the dynamism of the U.S. economy and underlines a significant challenge that policymakers face when trying to address both the real safety concerns of business workers and the benefits these services provide for consumers,” says University of Chicago Harris Public Policy. Dmitri Koustas, assistant professor at his school.

Commercial Vehicle Insurance

In response to changing demand patterns, some companies have quickly transitioned to the delivery-based model. The company’s head of business development, Jo Farish, says Pale Green Dot, a British company that specializes in connecting restaurants to local farms, is adding a home delivery option in 2020.

“We went from 0% domestic versus 100% commercial sales to 95% versus 5%,” Farish says. Rebuilding the website and purchasing more delivery vans has helped Pale Green Dot transition into delivering product boxes to homes in southeast England.

It’s not just restaurants, grocery stores and farmers who have had to adapt to delivery models to get their food to customers. Food banks and food aid providers have also adapted.

Commercial Auto Insurance For Delivery Drivers In New York

However, due to COVID-19 restrictions, some charities are struggling to get donated food to people in need. For example, Detroit-based food pantry Auntie Na’s Village has partnered with local churches and nonprofits to collect food. But the organization struggled to find people who could spread the virus to people who went home and were quarantined.

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However, the will to help their communities remains strong in these organizations. “If we can find enough volunteer drivers to deliver [donated food] to us, then we’ll definitely do our best to keep that going through the first month of the year,” says Sonia Brown, founder of Auntie Na’s Village.

Generally speaking, drivers do not deliver through a platform that coordinates drivers and deliveries, or in exchange for compensation in employment.

As a result, Forbes editor Jason Metz warns that deliveries often mean commercial use of a vehicle rather than a personal vehicle.

“Car insurance companies view commercial use as a higher risk than personal use and charge accordingly higher rates. Delivery drivers are more likely to crash and file car insurance claims,” ​​writes Metz.

Personal Vs Commercial Auto Insurance

Small businesses that rely on delivery drivers may also need additional coverage, Metz says. For example, these businesses can benefit from commercial motor insurance policies if they provide vehicles used by delivery drivers. If employees use personal vehicles only for occasional business duties, the business may qualify for unowned car insurance coverage.

To respond to the spike in delivery requests, some restaurants have had their employees do the deliveries. However, this regulation may also raise coverage concerns.

“As these restaurants were not previously set up for delivery, many allow their employees to use their own personal vehicles for delivery. This raises insurance coverage issues for the employee,” writes Heath P. Straka of Axley Brynelson law firm. It can also expose the business to the costs and stress of a lawsuit.

Commercial Auto Insurance For Delivery Drivers In New York

To handle the risks of lawsuits, some small businesses rely on their drivers to find the coverage they need by purchasing the coverage they need in the event of a lawsuit.

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For example, Bill Siwicki, owner of Pizza Works, buys additional collateral to cover the risks of litigation. While Siwicki drivers are expected to have their own auto insurance, Pizza Works also has insurance “in case someone goes up the stairs and starts suing people,” says Siwicki. Drivers’ auto insurance policies cover their behavior; Pizza Works’ supplemental insurance provides assistance in the event of a litigation related to the behavior of drivers.

Delivery drivers who get a job through platforms like Uber Eats can actually get additional coverage through the platform, which aims to cover their risk while delivering.

For example, in May 2020, ridesharing company Buckle received provisional approval in Georgia to add insurance coverage for delivery drivers carrying food and household supplies to customers. This coverage has helped delivery drivers and small businesses deliver food and supplies without the added insurance risks.

“As demand for ride-sharing services has dropped significantly due to COVID-19, ride-sharing drivers have moved to provide the essential home delivery that many rely on while in quarantine,” says Buckle co-founder Martin Young. Extended coverage for these drivers can help protect both drivers and the businesses that rely on them, helping to protect an important supply chain for stay-at-home stayers.

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For small businesses, the cost of additional insurance coverage can be alarming. Many small startups evaluate the risk of being unsecured against the cost of acquiring that collateral. By clearly informing and educating business customers about the benefits of certain types of coverage, insurers can help these entrepreneurs make more informed decisions.

Many delivery drivers occupy a gray area between net personal and commercial vehicle use. This will be especially true if the driver uses the same vehicle to run their own business and deliver to businesses and customers.

As a result, insurance companies will need to be aware of changing demands for delivery drivers as well as state and federal regulatory demands to ensure customers get the insurance coverage they need.

Commercial Auto Insurance For Delivery Drivers In New York

Some states have required insurance companies to respond to the coverage needs of delivery drivers. In Wisconsin, for example, the Insurance Commissioner has required insurance companies to provide coverage for drivers who deliver restaurant deliveries as the public health emergency related to COVID-19 continues.

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The Wisconsin order required insurance companies to “cover delivery services to restaurants under their personal auto insurance policies.” They are also required to “provide, if requested, coverage for drivers hired as passengers and unclaimed cars on a restaurant’s general liability insurance,” according to a statement from the state’s Office of the Insurance Commissioner.

The Connecticut Department of Insurance took a similar approach, asking insurance companies to expand coverage of personal vehicles to certain business purposes, including working as a delivery driver carrying food or medicine. Under the guidance of the Insurance Department, the ways in which insurance companies can treat such coverage as an endorsement have been outlined.

“We all need to support our local businesses, especially restaurants that switch to food delivery to keep their kitchens open and their employees working,” says Andrew N. Mais, Connecticut’s insurance commissioner.

DoorDash driver Bentley Koup predicts demand for delivery drivers will continue beyond the current crisis. Not only did shoppers see delivery as a viable option, many restaurants and other businesses have embraced this model as well.

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“You used to have a lot of restaurants that weren’t sure if food delivery would work, but now a lot of them need us,” says Koup. As both customers and restaurants continue to be interested in food delivery, drivers’ demand for food and food delivery and their need for insurance coverage is likely to continue.

A robust distribution system is necessary to enable communities to maintain their individual and collective health during a pandemic. However, such a system also requires the support of insurance coverage to manage risks. By understanding the changing dynamics of deliveries, insurers can better meet customers’ needs during this time. Your personal auto insurance policy will not apply if you or your employees regularly go to client meetings, transport equipment to and from job sites, or make deliveries for work. I will protect you. Commercial auto insurance can help protect business owners and self-employed professionals

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