If your teenager earns money using your car- perhaps delivering pizza (or groceries, newspaper or fast food) – you are going to need more that just your personal auto policy for insurance.
The fact that your car is being used in order to make money, even if it’s just on weekends, means you will need to have a commercial insurance policy in order to be correctly insured.
That’s because most personal auto insurance policies exclude business use.
In fact, many personal auto insurance policies have a no “pizza delivery” clause due to the risk involved with that industry – combined with the high mileage and age demographics of pizza delivery drivers. The statistics show that the majority of pizza delivery drivers are college students or teens, which are the highest collision risk of any other group, age-wise.
This would mean that if your teen is in a collision, you may have to pay for the entire accident out of your own pocket.
It is likely that your teen’s employer reimburses gasoline but will not compensate for any of the money spent due to an accident. For this reason, it is imperative that you find out whether the employer’s commercial auto insurance covers your car, and if so, what are the details?
It is also important to understand what circumstances apply. Will his insurance cover no matter whose fault the accident is? What are the monetary limits?
If the employer’s coverage does not apply to your teen, you need to check with your personal auto insurance company to determine whether you are covered already adequately covered or if you will need to purchase more coverage in case of accident.
It’s important for all those delivering to check their insurance policies, for their sake and the sake of others in the community.