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What Does Car Insurance Cover If I Get Paid to Drive or Deliver?

By Keith Stachowiak on August 31, 2016 // Leave a Comment

car-accident-attorney-milwaukee-advice.jpgA friend asks you to deliver something using your car and agrees to compensate you for your time and gas. You agree and are involved in an accident. Will your insurance cover you if a claim is made against you by the other driver? Maybe not.

As Milwaukee car accident lawyers, we want to make sure you know your legal rights and have the coverage you need in case you are involved in a car crash. Take a look at some helpful advice and what you need to know about current legal policies.

Coverage May Not Apply If You Are Involved In a Car Crash

Most private auto insurance policies have language that attempts to exclude coverage if you are compensated to transport something. For example, Wisconsin courts have considered the following language from actual insurance policies

MP_1.pngIf you drive for compensation, whether newspaper or food, you are not covered. “[A vehicle is not covered] while being used to carry persons or property for compensation or a fee, including, but not limited to, delivery of magazines, newspapers, food, or any other products. This exclusion does not apply to shared-expense car pools.” Crawford v. Progressive N. Ins. Co., 2002 WI App 134, ¶ 6, 255 Wis. 2d 831, 646 N.W.2d 854. 

MP_2.pngIf you lend your vehicle to someone who drives fora  fee, your vehicle is not covered. “[A vehicle is not covered] for that person’s liability arising out of the ownership or operation of a vehicle while it is being used to carry persons or property for a fee. This exclusion (A.5.) does not apply to a share-the-expense car pool.” Ennis v. W. Nat. Mut. Ins. Co., 225 Wis. 2d 824, 828, 593 N.W.2d 890, 892 (Ct. App. 1999).

MP_3.pngIf you carry a passenger for a fee, you are not covered. “[A vehicle is not covered] for any … person’s liability arising out of the ownership or operation of a vehicle while it is being used as a public or livery conveyance. This exclusion does not apply to a share-the-expense car pool.” Morris v. Buttney, 2000 WI App 23, ¶ 4, 232 Wis. 2d 462, 465, 606 N.W.2d 626, 628.

Car Accident Lawsuit Examples

  • Crawford, 2002 WI App 134, ¶ 2, involved a married couple delivering newspapers for a friend who owned the route. They made deliveries a couple weekends a month and were paid $100 per weekend. The court held that coverage  did not apply when the couple caused an accident while delivering the newspaper.

  • Ennis, 225 Wis. 2d 824, 828, 593 N.W.2d 890, 891-92, also involved newspaper delivery.. The language in the insurance policy was held to be ambiguous; and thereby construed against the insurance company, providing coverage. The ambiguity arose because fees were paid by the newspaper not only for the paper delivery, but also for performing miscellaneous services, such as fixing paper boxes. Accordingly, the fee was not solely for the act of transporting property because the delivery person also had non-delivery duties.

  • Morris, 2000 WI App 23, ¶¶ 2-3, involved a person delivering packages for businesses. The issue in the case was whether the exclusion for carrying persons or property for compensation applied to the delivery of solely people, or if it applied to packages as well. The court held that this exclusion applied to package delivery as well. Therefore, no coverage was provided to the driver.

These types of exclusions were designed to exclude coverage for a different type of risk than one arising from an ordinary passenger vehicle. Operators of taxis, buses, trains, and any other form of transportation available for a fee to the general public have a duty to exercise a “very high degree of care” to prevent injury to passengers.

Hunt v. Clarendon Nat. Ins., 2005 WI App 11, ¶ 17, 278 Wis. 2d 439, 452, 691 N.W.2d 904, 911. This is the law in Wisconsin, and pretty much everywhere else in the United States. This rule of law goes back to the horse and buggy days. Insurance companies rightly do not want to accept this type of risk under an ordinary car policy. Hence the exclusion was created. The exclusion, however, is not limited to regular or repeated deliveries. The language suggests a single paid for delivery would qualify. 

Here are our key takeaways from the current policies and legal proceedings reviewed above. 

  1. If you deliver things on a regular basis, make sure you discuss this with your insurance agent and purchase the appropriate endorsement for your policy. There are ways to obtain coverage for this type of situation.

  2. If your delivery is a single event, do not charge a fee or demand compensation. It is not worth it to risk voiding your insurance coverage if an accident were to happen.

At Murphy & Prachthauser we are car accident attorneys in Milwaukee who practice the law the way it should be practiced – motivated and equipped to do our best for you. We take pride in being good lawyers who help people. 

If you have a case you would like to speak to a personal injury lawyer about, please contact us to schedule a free case evaluation and get experienced Milwaukee auto accident attorneys working on your behalf.

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