Non Owned Auto Policy

I know this has been something that was brought up before, but we offer delivery and my insurance agent told me that a non owned auto policy wasn’t necessary. I have read on here that many of you have that policy, and was confused as to why he would have told me that.

For those of you that have it, how much does it cost ballpark annually. We have 5 drivers and they use their own cars.

Get it on company letterhead and have him sign that statement. Cheapest insurance you’ll ever have.

It is not legaly required but you are insane not to have it. If there is an accident you can count on being named in the suit. Your driver’s policy will not defend you. Your regular business policy will not either. even if you win, you are looking at 20-40K to defend yourself.

You can expect the policy to be $4,000 - $5,000.

Out of curiosity, what does everyone pay for general liability.

My general liability was $4.133 per $1000 in sales.

#1. First, find a new agent ASAP!
#2. The rate will varey depending on a number of factors but will wind up in the $4k-6K range. Pay it from the part of a delivery fee that you keep.
#3. Non-owned is only one line of defense. Be very aware that your policy will almost certainly require the following:
a. Your drivers may not have a record of current moving violations.
b. Unless the drivers maintain commercial coverage for"Pizza Delivery"
you will be on the hook for a $10,000 deductable PER INCIDENT.

If you drivers are collecting a delivery fee for insurance costs, ear and tear, fuel, etc…then make them use it to buy the insurance that covers your butts. The coverage I’m referring to (ckeck with progressive) will run them about 35% more than what they are paying anyway but at least you will all be covered. My driver get $3.00 per delivery, don’t have a choice in the matter, and everyone is smiling.

Our policy requirements are that a driver may not have more than one moving violation, no DUI, reckless careless etc. We get a DMV report when we hire them and submit that to the insurance company when they are added to the policy.

I can hire people 18 years old but the surcharge is outrageous so I only hire drivers who are at least 25.

I upped my delivery charge by 25 cents years ago and that about covered the policy.

I do not have a 10K deductable. Mine is 1K.

Ah… but the devil is in the details. Check with your agent to see what non-owned policy endorsements say regarding the type of insurance that the drivers are required to carry. That’s where the surprise is. If they don’t carry “delivery insurance” you will find (as I did) that your deductable is substantially higher.

My drivers drive my cars for the most part. I used only driver owned cars for several years and then switched to company cars about 4-5 years ago.

When we are slammed (more than 3 drivers on at once) some drivers will drive their own cars. Our insurance policy is an “owned” car policy with non-owned coverage included. Suprisingly, the price for the owned coverage is the same as for just hired and non-owned, but the coverages are different. Deductable is $1000.

This arrangement allows me to hire drivers that do not own cars, and I never have issues with the driver’s car being down for repairs. It also puts me in charge of safty issues like tires, brakes, lights etc etc. No squaking about the car top signs either.

All in all I come out a few thousand ahead each year with more flexibility.

Those "details’ make it more understandable. Since you are providing and paying for the “fleet” expenses, what is your delivery chage and who get what between you an the drivers.

Iv’e though of doing it in whole or in part as well andcould get more drivers (retiree’s) if I provided the vehicle. We charge a $3.00 fee and it’s no bother too anyone. our customers will tip 4-6 on top of that on average for a $20 order.

We charge a $2 delivery fee. I keep it.

Drivers get $6.00 an hour plus tips. Since that wage is below minimum wage they delcare tips.

If they drive their own car, I pay them 6% of the deliveries they take.

TY for the reply…

We charge $3 delivery fee… drivers get it all, plus tips and $ 6.50 wage. Each (of 3 drivers) is getting around 70 deliveries a week over 35 hrs. In all, delivery is about 30% of my business. When not driving, they do EVERYTHING, from boxes to dishes to phones and prep. They have it made and whine all the time anyway…LOL. It’s for sure that they aren’t going anywhere and at least I know I/we are all properly covered.

NOTE: Great reply you gave to someone on the $100,000 investor. Your obviously very experienced in many areas of the business.

Who are you using for the hired non owned? The only place I can find to write me a policy here in Florida wants $20K for it.

I have coverage through Program Underwriters Inc, Tampa. Fl (800-282-2033) It costs me $5755 all inclusive annually.

You can try to shop here: (I think they’ll refer you to a local FL broker) (pizza program button on the right side)

There are only a couple underwriters who will touch pizza delivery - your broker with the 20K is probably quoting the wrong kind. Every insurance person I spoke with started out saying “of course we can offer that” - then tried and stalled and failed to come up with a policy.

But yes, I found it, and yes, you need it. Otherwise, with every delivery you are risking your entire future financial state…

I have recently gone through this while opening my first pizza place. I have been a delivery boy before and I know how things work. Unfortunatly I would say that having company cars is a terrible idea. Many people do not respect vehicles they don’t own.

My insurance is about $1100 a year with non-owned liability. I was told by my insurance guy that its very unusual to get that these days especially in a pizza place. I think they made a mistake and it worked out in my favor. Any one looking for a good policy in the NY metro area I have a great insurance guy and I didnt even realize how good it was till I just saw how much people are paying for their liability alone.

“Unfortunatly I would say that having company cars is a terrible idea. Many people do not respect vehicles they don’t own.”

There are pluses and minuses to everything. Being able to hire drivers that do not own cars is big one around here. Not being dependant on whether drivers properly inusure or maintain their own cars is another.

I have been doing this now going on 9 years. As a new operator you may find there are some things you don’t know yet. There are many more considerations than drivers respecting vehicles.

BTW/ I seriously doubt you have valid, meaningfull coverage at $1100 per year for a delco. If you have told your insurance company that you do not deliver you might get it for that but they will hang you on it if you get into a scrape. You might want to look into that.