Uber Eats, Grubhub And Other Delivery Drivers Need Insurance Coverage, So Why Won’t Regulators Mandate It?

The COVID-19 pandemic has impacted nearly every fiber of the world economy. As businesses have had to adjust how they transact with patrons in an effort to curb the spread of the novel virus, on-demand delivery drivers — classified as essential workers — have emerged unsung heroes.

Without the ability to tap into the burgeoning workforce of the gig economy, some businesses would not have been able to generate positive cash flows as they shifted to delivery in lieu of in-person shopping and dining.

Supermarkets, pharmacies and countless e-commerce businesses have seen a steady uptick in transactions that are powered by on-demand delivery drivers as their products complete the last mile in the value chain.

Rideshare companies have made headlines for disputes over the classification of their drivers (employees vs. independent contractors), and the rising demand for their delivery services has illuminated a sobering insurance gap in this space.

When Uber and Lyft first came of age, a series of accidents compelled state and local governments to respond to this emerging risk by adopting a mandatory commercial insurance requirement for the transportation network companies (TNCs).