Will your side hustle cost you more than you make?
- December 29, 2020
- Posted by: Sprouse Insurance
- Categories: Agency, Insurance
As our social landscape rapidly changes, more and more individuals are picking up side hustles as a convenient way to bring in an extra income. What many people don’t realize is that their side hustle can lead them to a financial disaster if they’re not properly protected.
Don’t worry, we are here to provide you with the right information to help you understand what you need.
In this blog post we break down what you need to know about insurance and your side hustle.
Why the need to review your insurance
“If I need insurance wouldn’t Uber, Lyft, DoorDash or whoever I’m working for provide it?”
This is a common question asked from those who use their vehicles for their side hustles, and it makes sense. Many of these companies do provide coverage but there are gaps between your personal policy and theirs which can leave you in a potentially financial disaster.
What does this mean for you? Having a gap in your policies means that if you were to cause an accident or were sued for an injury, your insurance policy won’t cover you.
Here is an example. As you drive to a restaurant to pick up food for a client you cause an accident. Your personal auto policy won’t cover you because you are driving for profit, but the side hustle company won’t cover you either because you have not come in contact with the actual food or client yet.
Any damages, injuries, or legal fees you incur will need to come out of your own pocket.
This is why it is vital to review your insurance and identify any gaps in coverage.
When to know if you need additional protection
When you purchased your auto insurance policy, it was designated as a personal insurance policy. This simply means that you are driving a car for personal reasons and is much more affordable than a commercial auto policy.
However, your personal auto policy will not cover you when you are driving for a profit. So, if you or a family member on your policy is using your vehicle for profit and an at fault accident is caused, your personal auto policy will not cover it.
Here’s when to know if you may need additional insurance protection:
- Are you driving for $$?
- Are there periods of time between when you’re working and when you’re actually delivering the product?
- Do you have multiple side hustles?
If you answered yes to any of these questions, you may need an endorsement to your policy. Don’t worry, a quick call to an agent will help you know for sure.
How much will it cost and what’s the process.
I’m sure you’re rolling you eyes at the thought of buying more insurance, but it’s really not that bad. For example, recently a client was able to add an endorsement for $5 a month to their personal auto policy. Your rate will likely be different as it varies from person to person, but will pale in comparison to the costs of being held personally liable.
And the process is fairly painless too. When an individual who has a side hustle comes to us we first review their policy to see if they need additional coverage or if they are already set. Next we simply provide a quote with the added endorsement.
One last thing to consider is that some will need more than an endorsement. If you are driving for a well-known delivery service, you likely only need an endorsement but for some, a commercial insurance policy may be required. This is why we encourage you to speak with an agent.
Whether your side hustle is Lyft/Uber, DoorDash/UberEats, Etsy or you are simply working towards your next career, let us help you make sure you have the correct insurance coverage in place.
Call us today at 419-332-3411 or Click Here for a Quote to see how we can help protect you!