Many of my clients are now working in the “gig economy” delivering on DoorDash or PostMates, or carrying passengers on Uber or Lyft. Unfortunately, I noticed that a lot of people are confused about the insurance situation for their gigs, and when I started researching the subject, I realized that the issue is really very complicated. So I’m going to put information here about the insurance of the various services. If anyone wants to know about any particular company, please reply here and later I’ll put the information here or on our FaceBook page.
Let’s Start With PostMates.
PostMates insurance covers up to $1 million of liability (damage you cause to another). This does not apply to damages you suffer in the accident; only for others. This also applies when you are making bicycle deliveries.
Note: PostMates insurance only applies when you have goods on hand. When you are on the way to pick up the goods, PostMates insurance does not apply.
Another thing: PostMates liability insurance is in excess of the limits of your own insurance. That is, they only pay after exhausting the limits of your insurance. Let’s assume your limits are $15,000 (the minimum required by law). If you hit someone and the damage is only $5,000 then PostMates will not contribute anything. If the damage is $20,000 then PostMates will contribute $5,000 over the $15k of your insurance.
Important to remember: PostMates will not pay ANYTHING if you are the victim of another’s negligence. In this situation it’s the at-fault driver’s insurance that pays. If the other driver does not have insurance, you will have to use your own insurance!
One good thing that PostMates insurance has is “MEDPAY” coverage. This will cover medical bills up to $50,000.00. This too is coverage in excess of your own insurance (health insurance, in this case). For example: anything you owe as a deductible or co-insurance, they cover. But this does not pay you pain and suffering damages and does not pay for lost income or lost time from work. It pays medical bills, nothing more.
Your Own Insurance
It is very important to look carefully at what you have in your own insurance. Here are a few things to look for:
ALWAYS BUY “UNINSURED MOTORIST” (“UM”). This will cover you if the other party does not have insurance.
ALWAYS BUY MORE THAN THE MINIMUM. The minimum limit for liability and $15,000 and UM will pay you the same limit you have purchased for your own liability coverage. If you buy larger limits then UM will cover you for any damages you suffer beyond the limits of the at-fault party’s insurance. For example, if you buy $25k limits, and get hit by someone who has insurance but only the minimum ($15k), your UM will pay $10k more. You should always buy the highest limits you can.
ALWAYS BUY “COLLISION / COMPREHENSIVE” because PostMates will not pay ANYTHING to fix your car.
It’s also a good idea to buy “RENTAL COVERAGE” so you can have a rental car while yours is being repaired, regardless of who is at fault for the accident.
Last, but most important: your own insurance may not apply if they do not know that you are working with PostMates!
If you have insurance, and your insurance does not know you are working with PostMates, you could lose everything!
If you have personal rather than commercial insurance, and they discover that you are using your car for business purposes, they may deny coverage for any accident, and may even cancel your insurance altogether.
If this happens, PostMates also will deny coverage, leaving you totally exposed.
And even worse: if you lose all insurance related to an accident, the DMV can cancel your driver’s license and also your vehicle registration!
However, some insurance companies do not insist on commercial policies for those who work with PostMates. Consult with an insurance agency, such as Elessar Insurance at Supermarket Brazil in Culver City (310) 237-1107.
And if you have an accident, at work or not, please contact me immediately!