DoorDash, Uber Eats, Grubhub - third-party delivery platforms have become essential for many restaurants. They handle the drivers, the vehicles, and in theory, the liability. But what happens when something goes wrong? What liability still sticks to your restaurant?
At Anchor Insurance, we help restaurant owners understand exactly where third-party delivery platforms' coverage ends and where your restaurant's exposure begins - and how to protect yourself with the right insurance.
How Third-Party Delivery Platform Insurance Actually Works
DoorDash, Uber Eats, and similar platforms provide insurance coverage for their delivery drivers - but only under very specific conditions:
What the Platforms Cover
Most major platforms provide:
- Auto liability coverage while the driver is actively on a delivery (from pickup to drop-off)
- Excess auto coverage that sits on top of the driver's personal auto policy (typically $1 million in liability)
- Occupational accident coverage for the driver if they are injured during a delivery
This sounds comprehensive - but there are major gaps.
When Platform Coverage Doesn't Apply
Third-party delivery coverage typically excludes or limits:
- Product liability: If a customer gets food poisoning or has an allergic reaction, the platform's coverage does not protect your restaurant
- Alcohol liability: If you deliver alcohol and the customer later causes an accident or injury, your restaurant can be held liable under dram shop laws
- In-restaurant incidents: If a delivery driver slips and falls in your kitchen, the platform's coverage may not apply - your general liability or workers' comp exposure is triggered
- Off-platform deliveries: If your staff delivers food directly using their own vehicles (even occasionally), platform coverage does not apply at all
- Driver disputes: If a delivery driver is misclassified (W-2 vs. independent contractor), your restaurant could be pulled into liability claims or regulatory disputes
What Liability Still Sticks to Your Restaurant?
Even when you use third-party delivery platforms exclusively, certain risks remain firmly attached to your restaurant:
1. Product Liability (Food Quality & Safety)
You are responsible for the food you prepare, package, and hand off to delivery drivers. If a customer becomes ill due to:
- Food contamination or spoilage
- Undeclared allergens
- Improper food handling or temperature control
- Foreign objects in food
Your restaurant is liable, not the delivery platform. This requires product liability coverage, typically included in your General Liability or BOP policy.
2. Liquor Liability (Alcohol Delivery)
If your restaurant delivers alcohol through third-party platforms or in-house delivery, you face liquor liability exposure if:
- You deliver to a visibly intoxicated person
- You deliver to a minor (even if ID was checked by the driver)
- The customer causes an accident or injury after consuming alcohol delivered by your restaurant
Third-party platforms may assist with age verification, but your restaurant is still the licensed seller and retains liability under dram shop laws. You need a liquor liability policy to protect against these claims.
3. Premises Liability (Driver Injuries On-Site)
When a third-party delivery driver enters your restaurant to pick up an order, they are a business invitee. You owe them a duty of care. If they:
- Slip and fall in your kitchen or dining area
- Are injured by equipment or hazards in your space
- Are assaulted in your parking lot or adjacent areas
Your restaurant can be held liable. Your General Liability or BOP policy should cover these claims.
4. Vicarious Liability (Employee Misclassification)
If you use a mix of third-party drivers and your own staff for delivery, there's a risk of:
- Employee misclassification claims (if drivers are treated as employees but classified as contractors)
- Joint employment liability (if you exercise too much control over third-party drivers)
While rare, these scenarios can create unexpected liability. Employment Practices Liability Insurance (EPLI) can help in some cases.
The Risk of Hybrid Delivery Models
Many restaurants use a combination of third-party platforms and in-house delivery:
- During peak hours, you use DoorDash/Uber Eats for overflow orders
- For catering or special orders, employees deliver directly
- You offer direct delivery to loyal customers to avoid platform fees
This creates a coverage gap. Third-party platforms only cover their drivers, not your employees. If your employee uses their personal vehicle for a delivery and causes an accident:
- The platform's coverage does not apply
- The employee's personal auto policy may deny business use
- Your commercial auto policy (if you have one) only covers company-owned vehicles
This is where Hired & Non-Owned Auto (HNOA) insurance becomes critical. It fills the gap when employees use personal vehicles for business purposes.
What Coverage Do You Need When Using Third-Party Delivery?
Here's a breakdown of what insurance you need based on your delivery setup:
Scenario 1: 100% Third-Party Delivery, No Employee Vehicles
You still need:
- General Liability / BOP: Covers product liability, premises liability, and injuries to delivery drivers on your property
- Liquor Liability: If you deliver alcohol (required whether you use platforms or not)
You probably don't need:
- HNOA: Not necessary if employees never use personal vehicles for business
- Commercial Auto: Not necessary if you don't own any delivery vehicles
Scenario 2: Mix of Third-Party & Employee Delivery (Hybrid Model)
You need:
- General Liability / BOP: For product and premises liability
- Liquor Liability: If delivering alcohol via any method
- Hired & Non-Owned Auto (HNOA): Covers liability when employees use personal vehicles for deliveries or business errands
You may also need:
- Commercial Auto: If you own any delivery vehicles (even one)
Scenario 3: In-House Delivery Only (No Platforms)
You need:
- General Liability / BOP
- Liquor Liability (if applicable)
- Hired & Non-Owned Auto (HNOA): If employees use personal vehicles
- Commercial Auto: If you own or lease delivery vehicles
How to Protect Your Restaurant from Delivery Liability
1. Understand Your Delivery Platform's Coverage
Request copies of the insurance certificates from DoorDash, Uber Eats, or other platforms you use. Review:
- What is covered and what is excluded
- Limits of liability
- When coverage applies (only during active deliveries)
2. Review Your Current Policies for Gaps
Check your General Liability or BOP policy to confirm:
- Product liability is included (it usually is)
- Premises liability applies to business invitees like drivers
- Auto liability is excluded (it almost always is - hence the need for HNOA)
3. Add HNOA if You Use Employee Vehicles
If employees ever use personal vehicles for deliveries, errands, or catering, add HNOA coverage. This is typically inexpensive ($300-$1,200/year) and prevents massive liability gaps.
4. Maintain Proper Liquor Liability Coverage
If you deliver alcohol, ensure your liquor liability policy is active and includes delivery operations. Some insurers exclude delivery; make sure yours doesn't.
5. Work with a Broker Who Understands Restaurant Risks
At Anchor Insurance, we specialize in restaurant coverage and can shop multiple carriers to find policies that specifically address delivery liability, whether you use third-party platforms, in-house delivery, or a hybrid model.
Frequently Asked Questions
If DoorDash has $1 million in coverage, why do I need my own insurance?
DoorDash's coverage only applies to auto accidents caused by their drivers while on active deliveries. It does not cover product liability (food poisoning, allergens), liquor liability, premises liability (driver injuries in your restaurant), or any incidents involving your own employees. You need separate coverage for these risks.
Does my BOP cover product liability for food delivery?
Yes, most Business Owners Policies (BOPs) and General Liability policies include product liability coverage, which protects you if a customer gets sick from food you prepared. This coverage applies regardless of how the food was delivered - in-house, third-party, or pickup.
What happens if a DoorDash driver gets injured in my restaurant?
If a delivery driver slips, trips, or is otherwise injured on your premises, they may file a claim against your restaurant. This is a premises liability claim, typically covered by your General Liability or BOP policy. Make sure your policy includes coverage for injuries to business invitees.
Do I need HNOA if I only use third-party delivery platforms?
Not necessarily - HNOA is specifically for when your employees use personal or hired vehicles for business purposes. If 100% of your deliveries go through third-party platforms and your staff never drives for business errands, you likely don't need HNOA. However, if employees occasionally deliver directly, run catering orders, or make supply runs in personal vehicles, HNOA is essential.
Can I be held liable if a customer gets alcohol poisoning from delivery?
Yes. If you hold a liquor license and deliver alcohol, you can be held liable under dram shop laws if you over-serve a customer or deliver to someone who is visibly intoxicated or underage. This is true whether you deliver directly or through a third-party platform. You need liquor liability insurance that explicitly covers delivery.