When you are thrust into the role of operating your own business, you find yourself starting to watch every penny. It especially happens when you start tracking everything. You find out what expenses can really be, you get a bit nervous that you’re not making as much money as you’d hoped, and you watch. every. penny.
There are many times where that’s really smart. You start thinking about what those miles cost and you become more careful and intentional about how far you drive. You realize you will need some of that tip money down the line, so you save it rather than spend it at the drive through.
And then there are times where it can be downright dumb. In some cases, it’s more like colossal stupidity dumb.
Always Remember This Rule: You Are a Business Owner.
If you haven’t noticed yet reading this blog, I will harp on that. A lot
There’s a difference between being smart with your money and being a cheapskate.
Sometimes as a business owner it makes sense to spend money. Sometimes spending money can earn you more money. Case in point – paying someone to change my oil. Pro’s can get it done in a short amount of time. I can do it myself but I’m incredibly slow at it, and the couple hours it takes for me to make a far bigger production out of getting it changed and getting cleaned up afterwards? I could have made $40 to $50 in that time.
Sometimes it’s not quite as easy to figure out where it makes sense. As a business owner you have to think through all of the implications of every dollar you do or don’t spend.
There is no bigger example of the necessity of doing this than thinking through your car insurance.
You can save several dollars a month by sticking with your personal insurance policy. That’s tens of dollars. Maybe 30 or 40 bucks. Hey, that adds up, right?
But what happens if there is an accident?
Are you aware that most personal car insurance policies specifically exclude you from coverage if you get into an accident while doing deliveries? If you do not have either a rider on your insurance (if offered by your provider) or a commercial policy for delivery/rideshare, you may not be covered.
What does that mean?
That means that anything that your insurance might have paid for liability, medical bills, repair or replacement of your vehicle will now have to come out of your pocket.
If you were at fault, that could be tens, if not hundreds, of thousands of dollars.
Do you have that kind of money to just pay out?
If you have a car loan, do you have the money to pay off the loan when your car has been totaled?
Do you have the money to pay for your medical bills and deductibles if you were hit by an uninsured driver?
But my insurance company doesn’t have to know I’m delivering food. I could just hide the bag!
Maybe in a mild fender bender, you might have the presence of mind to do that.
But what if it’s really serious? Something where the damage is major, there are injuries, or worse? Trust me, the last thing on your mind is to ‘hide the evidence.’ You hope it never comes to that, but it’s just that kind of scenario where you need your insurance the most.
And when it’s real serious, there’s real money involved. Money for medical bills. Lawsuits when injuries are bad or fatal. Ambulance chasers come out of the woodwork. There’s one thing these lawyers know, that the more people they can sue, the more money they can get for their clients. And themselves too, not that that’s a concern of theirs, right? So if there’s any whiff of anything that leads them to think that a restaurant or a delivery company (who all have HUGE insurance coverages) you can bet they’re going to try to dig that up.
Insurance companies are experts at getting out of paying claims.
I know, that’s kind of hard to say spend a little more with insurance companies when you aren’t real sure they’re going to have your back. But you realize that the real reason injury lawyers make the big bucks isn’t because they are going after the other driver, but because they go after the insurance companies who try to pay too little. While I’m not a fan of ‘ambulance chasers’ they exist mostly because insurance companies don’t want to pay up.
And just like those ambulance chasers, if they get any whiff that you’re doing something that invalidates your insurance, you can bet they’re going to find it.
Is that a risk you’re willing to take? You honestly think you can get away with ‘I just won’t tell anyone I’m delivering’??? Are you willing to lose everything you have all because you wanted to save $30 a month?
THAT is the definition of bad business.
Make Sure You Are Covered
If you don’t know if your insurance will cover you, find out before you do another delivery. I’m serious here, it’s that important.
Find out if the platforms you are delivering for provide any coverage. Here are the three that I know of:
- Uber has the best coverage – they actually provide insurance coverage while you are on deliveries and while you are on your way to pick up deliveries. However, there have been cases where people have been in accidents while waiting for an order, and because they hadn’t received an order Uber didn’t cover them but because they were logged into the app it was enough for their insurance to get out of it.
- I’ve seen where Doordash has stated that they provide some coverage, but what I’ve seen is that it’s only during the time that you have food in your car. That would mean you are not covered while en route to the restaurant.
- I emailed my driver specialist from Grubhub right when I started and he specifically stated Grubhub provides no coverage.
Find out what your insurance policy covers. You want to look especially for exclusions, you are almost sure to find delivery and rideshare specifically excluded if it’s just a standard policy.
Find out if your insurance company offers a rider or add on to cover delivery work. Some do, some don’t. My company did not so I took my car off the family policy and got a commercial policy.
Whatever you have to do to make sure you are covered, do it. Don’t wait, and don’t take the chance of doing deliveries without doing it.