Should that person be exempt from using their personal auto coverage if they were involved in an accident on the way to another job site? Let’s say, for example, that an independent contractor used his or her own personal vehicle to travel from job site to job site. The issue with the broad definition of commercial use by insurance companies is that many actions on behalf of drivers can be classified as commercial use. Broad definitions of commercial use in insurance policies These exclusions also do not apply to drivers who maintain or use vehicles such as private passenger autos, pickups, motorhomes, vans, or trailers. These two exclusions do not apply to drivers who use their personal auto insurance policies for professions such as farming or ranching. Selling, Repairing, Storing, Servicing, or Parking Vehicles. If you are using your car for the purpose of picking and dropping off people or delivering goods such as groceries back and forth, that counts as commercial use. Many insurance companies define a public or livery conveyance as the public pickup and delivery of people or goods. Under a personal auto insurance policy, you are likely to be exempt from all coverage if your vehicle is used for these exclusions: Issues such as physical damage done to vehicles used for commercial use are covered under commercial auto insurance. The personal auto insurance policy should not be used to cover any liabilities created by a business. In the eyes of the driver’s insurance company, a personal auto insurance policy is designed with the intention of keeping the driver and the driver’s family members protected and insured. What is the difference between personal auto insurance and commercial auto insurance?īesides the obvious difference in price, commercial auto insurance and personal auto insurance serve different purposes. This means that if the independent contractor is involved in a crash while performing work under Instacart, the driver may not be covered under their policy. If an insurance company discovers that a driver is performing any commercial use activities with their vehicle under their personal auto insurance policy, the insurance company has the right to refuse coverage. Commercial use can cover a range of business activities such as taxi use or delivering grocery items any activity where a vehicle is being used to transport people or goods and the driver can receive payment is defined as commercial use. Traditionally, a personal auto insurance policy does not cover aspects such as liability, physical damage, medical payments, or uninsured motorists for drivers who use their vehicles for commercial use. This can present many issues for the independent contractor, however, if their auto insurance contains a commercial use exclusion in the policy. What is specified is that independent contractors who sign a third-party agreement with Instacart must provide his or her own personal auto insurance. Instacart, however, is unique from other third-party applications because it is not specified whether the company provides commercial auto coverage. Commercial use auto coverage allows businesses to safeguard themselves against any financial losses that stem from auto accidents. What is commercial auto coverage?Ĭompanies that employ independent contractors such as Instacart take advantage of a policy known as commercial use auto coverage. While the increase in shoppers is beneficial for Instacart, the shoppers who deliver groceries encounter the same risks that independent contractors working with Uber and Door Dash encounter when it comes to commercial use for auto policies. Not surprisingly, there was an increase of Instacart Shoppers from 130,000 in 2019 to 500,000 in 2020. Shoppers can pick up, shop, and deliver groceries to the customer’s address in a designated time frame. Instacart is a food delivery service application that allows independent contractors to gain additional income by shopping for various customers. One of the companies that nearly doubled its profits during the coronavirus pandemic is Instacart.
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