Does Driving for DoorDash Raise Your Insurance Rates?

Driving for a food delivery service like DoorDash can be an easy way to earn extra income. However, many drivers wonder if working for DoorDash will increase their car insurance rates. There are a few factors that determine how delivering for DoorDash impacts your auto insurance coverage and premiums.

How DoorDash Delivery Driving Affects Your Insurance Policy

• Most standard personal auto insurance policies only cover driving for personal reasons, commuting to work or school, and doing occasional errands. They do not provide coverage for commercial activities like food delivery.

• When you drive for a food delivery service, you are generally considered to be driving for commercial purposes. This transforms your personal vehicle into a commercial one when used for work.

• Using your car for food deliveries may be considered a violation of your insurer’s terms and may void portions of your policy. At a minimum, insurance companies need to be informed that the vehicle is used for food delivery work.

• Special commercial auto insurance is required to get appropriate coverage for food delivery drivers. Commercial policies provide protection for activities like carrying food items and paying for vehicle damage or injuries while working.

• Without notifying your insurer and getting commercial coverage, you risk having reduced coverage or rejected claims if you are in an accident while delivering food.

Will My Insurance Rates Go Up if I Drive for DoorDash?

In most cases, yes – using your personal vehicle for food deliveries will cause your auto insurance rates to increase:

• Once you inform your insurer you are driving for DoorDash, they will likely re-classify your vehicle to be under a commercial policy. This will be significantly more expensive than a standard personal policy.

• Commercial auto insurance rates are often 100% to 300% higher than a personal policy for the same driver and vehicle. Higher limits may also be required.

• Your insurer will view you as being engaged in more risky driving behavior since you drive frequently, at night, in dense urban areas, and carry additional distractions with food orders.

• You rack up significantly more miles than the average driver when making deliveries. Higher mileage is another reason rates increase under commercial policies.

• Food delivery is considered one of the riskiest professions for auto insurance. Claims are frequent due to making frequent stops, double parking, and having a distracted driver. Expect steep rate hikes.

• Some insurers may even decline to offer commercial policies to food delivery drivers due to the heightened risks.

Options for Insuring Your Vehicle When Working for DoorDash

If you want to maintain proper insurance coverage when driving for DoorDash, here are your options:

• Inform your insurer – Notify your insurance company of your intentions to drive for DoorDash before accepting any orders. They may choose to cancel your policy or increase your rates.

• Upgrade to a commercial policy – Work with your insurer to change your policy to a commercial one. Be prepared for significantly higher premiums, but this provides the right protection.

• Purchase supplemental coverage – Some companies like State Farm offer low-cost supplemental food delivery coverage you can add to a standard personal policy. This is the most affordable way to get commercial-level protection.

• Buy rideshare insurance – Rideshare policies that cover driving for Uber and Lyft may also apply to food delivery, but check your policy language first. Premiums are cheaper than commercial insurance.

• Use DoorDash’s contingent coverage – As a last resort, DoorDash provides limited insurance coverage from the time you accept an order to when food is delivered. It won’t fully replace a commercial policy, however.

Steps to Take When Driving for DoorDash

Follow these best practices when driving for food delivery services:

• Thoroughly read your personal insurance policy and double check what is excluded. Look for language about commercial use.

• Contact your insurance provider and ask what supplemental coverage options are available if you drive for DoorDash.

• Consider getting quotes from commercial insurers if your current provider’s premium increase is too steep.

• Accept only food delivery work that falls under your policy’s parameters or after you’ve obtained proper commercial insurance.

• Avoid making your auto policy void by not logging miles spent delivering food if you lack the right coverage.

• Drive carefully and maintain a clean driving record to prevent costly accidents that may not be covered by personal insurance.

• Track all mileage you accrue while completing deliveries for tax deduction purposes.

The Bottom Line

Driving for DoorDash and other food delivery platforms puts your personal insurance coverage at risk. To make sure you have adequate protection, speak with your provider and upgrade to commercial insurance or supplemental coverage. While your rates will likely go up, this safeguards you against denied claims in the event of an accident while working.