Despite being in operation in Alberta for several years now, or perhaps because of it, the Canadian Underwriter is warning that drivers for rideshare companies and food delivery services are facing confusion about their coverage.
Some drivers under the impression that they are covered through the company they work for are discovering there’s a lot more grey area in the matter than they originally thought. Cases involve drivers working in food delivery or rideshare jobs who had accidents leading to claims against their personal auto insurance coverage that have since been denied. Some insurers are unwilling to pay such claims, even deeming them fraudulent, and drivers are genuinely bewildered as to why.
The problem is that there is huge inconsistency and lack of transparency on the part of insurers as to whether their clients are permitted to work as a rideshare or food delivery driver and how much their personal insurance will actually cover. Essentially, Canadian Underwriter is warning that auto insurance companies might agree to cover rideshare and food delivery drivers, but if you have an accident the decision on your claim is up to their discretion and decided on a case-to-case basis. It’s noted that the issue seems to be mainly directed towards food delivery drivers, as their jobs (and tips) are contingent upon how fast they are able to deliver food and how many deliveries they make. This is, of course, a nightmare for insurers, as drivers in a rush are a major cause of accidents.
Insurance for food delivery drivers as provided by companies
Some food delivery services provide a small amount of coverage for their drivers, but personal auto insurance will more than likely come into play with any accident. Food delivery drivers should not rely solely on their employer for assistance. Each company is different and, as many food delivery drivers work for different companies at the same time, it is incumbent upon the driver to be fully aware of how their coverage works for each.
Uber Eats provides a commercial insurance policy for their drivers that differs slightly for each province. In Alberta, Uber Eats drivers are ostensibly covered by their policy, which includes up to $2 million in third-party liability coverage for an insured accident. The policy covers a delivery driver’s liability to third parties from the moment a driver accepts a delivery request on the Uber platform until its conclusion for a covered accident. It also (ostensibly) covers drivers during the time they are available through the Uber app but have not yet accepted a delivery request.
DoorDash provides a slightly less robust form of food delivery car insurance than Uber Eats. DoorDash only provides excess third-party auto liability coverage for drivers during the “delivery service” period, meaning coverage is only active when a “Dasher” is on active duty, including while on route to pick up an order, and coverage only applies after personal insurance limits have been used up.
Skip the Dishes does not provide any sort of supplementary coverage. Their website states that Skip drivers are responsible for their own coverage through their own auto insurance. Above and beyond that, all Skip asks is that drivers have a reliable vehicle and a valid licence.
Insurance for rideshare drivers
At the beginning of last year the Calgary Herald reported that 4,710 Albertans are driving for Uber, the province’s largest rideshare company in operation. In 2022 in Edmonton, rideshare companies made about 7.2 million trips, eclipsing regular taxi drivers by about 65%. As Lyft only became operational in Alberta in May 2023, it has far fewer drivers but is growing as an alternative to and competition against Uber.
Rideshare drivers in Alberta are required to have a valid Class 1, 2, or 4 licence. To obtain a Class 4 licence drivers will need to book a medical examination with their doctor and have them complete a form. Drivers also need to complete a knowledge test based on information from the Commercial Driver’s Guide and the Driver’s Guide and schedule a Class 4 road test with an Alberta registry. Make sure to review the vehicle requirements before booking a test.
The Class 4 Commercial Licence is technically, yes, a commercial drivers licence, which provides the ability to operate several professional and commercial vehicles such as school buses, service vehicles, and all the vehicles permitted with a full Class 5 licence. Although it is a commercial licence, whether or not you need commercial auto insurance is dependent on what you do for a living and your particular auto insurance company.
Questions to ask your insurance company if you are a rideshare or delivery driver
The confusion rideshare and food delivery drivers are feeling is due to a lack of communication with their auto insurance companies, so we encourage all those in the industry to take the time to call their provider and ask a few pointed questions. Don’t forget that you also have the expertise of Lane’s highly knowledgeable and experienced insurance brokers at hand as well. If you are still in the dark after speaking to your company, or if you think you are being asked to pay for commercial auto insurance when you shouldn’t really need it, give us a call. As insurance brokers it is our job to provide options to our clients they may not have been aware are available.
Ensure you are properly covered to be a rideshare or food delivery driver by making the following inquiries.
- Am I insured to be a rideshare or food delivery driver through your company?
- What documents do you require for me to be engaged in this type of work?
- For rideshare drivers, do I need commercial vehicle registration and plates?
- Is there anything else I need to know about my coverage?
- What documents will you require if I am in an accident while working (such as reciepts and orders)?
Find the right coverage through us at Lane’s
At Lane’s, we work for you, not the insurance companies, which means we are always open and transparent about our policies. We have absolutely nothing to gain by not being as honest as possible about what we offer, and we are able to provide the added bonus of excellent rates due to long-standing relationships with our partners. In short, we know exactly what kinds of policies work best for our clients. We’d love to get to know more about you and your insurance situation. Contact us at our Calgary, Banff, Edmonton and greater Alberta offices.
