Extra Credit Assigment 2

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University of South Carolina *

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341

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Finance

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Jan 9, 2024

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Nathan Conway FINA 341 Section 001 December 3, 2023 Optional Extra Credit Assignment #2 1. Based on the video and article referenced above, summarize the situation and explicitly discuss why the person whose car was damaged had such a hard time getting someone to pay for that damage. Ed Clare in Milford, Massachusetts, faced difficulty obtaining compensation for his car’s damages caused by a DoorDash delivery driver. Despite having video evidence, DoorDash claimed the driver was no longer their contractor after delivering the food. DoorDash directed Clare to the driver’s insurance, but her identity was not disclosed. Even when the police identified her, her insurance refused coverage, citing commercial use. Clare faced four months of frustration with both DoorDash and the driver’s insurance before seeking help from NBC10 Boston. DoorDash eventually reimbursed Clare for the damages, and the responsible driver was removed from the platform. The challenges came from DoorDash’s initial claim that the driver was no longer their contractor at the time of the incident, leading to difficulties in actually determining the liability and securing the compensation. 2. Summarize in your own words what DoorDash covers and does not cover. Are there instances when you might be driving for DoorDash, are involved in an accident-causing damage to or injury to a third-party and are not covered by the DoorDash policy? In all other U.S. states, DoorDash provides third-party auto liability insurance for Dashers during the “Delivery Service” Period. This coverage applies when a Dasher accepts a delivery request until the order is marked as delivered, unassigned, or canceled. However, it’s important to note that Dashers must maintain their primary auto insurance with minimum limits according to local laws. DoorDash covers damages or injuries caused by Dashers to third parties during the “Delivery Service” period, but there are specific conditions under which the DoorDash policy may not apply. The first of these conditions is associated with the Dasher’s auto insurance responsibility. If Dashers are online but have not accepted a delivery request, their primary auto insurance is responsible for any incidents. DoorDash coverage kicks in only during the “Delivery Service” period. The next condition is with the coverage denial letter. DoorDash coverage applies when a claim has been submitted to the Dasher’s auto policy, denied, and the Dasher provides a coverage denial letter. This implies that Dashers need to utilize all of their own auto insurance options before DoorDash’s Conway 1

coverage is able to come into play. The last condition is associated with damage to the Dasher’s vehicle. Damages sustained to a Dasher’s vehicle are the responsibility of the Dasher and should be addressed by their own auto insurance carrier. DoorDash’s coverage primarily focuses on liability to third parties. Overall, DoorDash’s policy covers third-party liability during the “Delivery Service” period, dependent on the Dasher meeting certain conditions, maintaining primary auto insurance, and addressing damages to their own vehicle through personal coverage. 3. Will your personal auto policy cover you while driving for DoorDash or similar platform? Why or why not? What can you do to make sure you are covered should you decide to drive for DoorDash? Whether your personal auto insurance policy covers you while driving for DoorDash or a similar platform really depends on the terms of your insurance policy. Typically, personal auto insurance will not extend coverage during commercial activities, like in the case of food delivery. This is often due to a commercial use exclusion in many policies. If you fail to state that you are working as a delivery driver to your insurance company, it could be considered a material misrepresentation. This could potentially lead to the denial of coverage or policy cancellation. To ensure coverage while driving for DoorDash, it is recommended to inform your insurance company about your intentions to be a delivery driver before you do so, explore the overall options for commercial or rideshare insurance, review DoorDash’s insurance policy for coverage details during different delivery periods, and maintain accurate records of your driving. Taking these steps helps ensure that you are adequately covered and can make informed decisions about your insurance needs while working for DoorDash or a similar service. Conway 2

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