What is pay-as-you-go food delivery insurance?
Pay as you go (PAYG) delivery insurance is a type of hire and reward insurance that is only active when you make your food deliveries.
It is the perfect instance option for part-time delivery drivers who want to be legally compliant with the UK’s insurance laws while out on deliveries.
We’ll discuss the ins and outs of PAYG fast food delivery insurance, what is and isn’t covered, and how you can cut the cost of your PAYG insurance premiums.
How does pay as you go food delivery insurance work?
PAYG delivery insurance is a type of temporary courier insurance that can be activated and deactivated as needed by the delivery driver.
It is a cost-effective option, as you only pay for the times when you need the insurance – when you’re out delivering food. It is usually charged by the hour or based on how many miles you drive.
PAYG insurance is tracked through a smartphone app and the driver can simply switch off the insurance policy in between deliveries.
Pay as you go is not a replacement for standard vehicle insurance. It is an add-on to your social, domestic & pleasure (SD&P) car insurance policy.
To make sure that the driver is not making deliveries without their policy in place, most insurance companies will install a telematics device (also called a black box) in the delivery vehicle. This device tracks the driver’s deliveries and driving behaviour.
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Get QuotesWhat are the benefits of pay as you go insurance
PAYG insurance is the perfect option for a part-time food delivery driver who only wants courier insurance while on the job.
The benefits of PAYG delivery insurance include:
Cost-effective
Since you would only activate the insurance cover when you are doing deliveries, you will not pay unnecessarily.
Flexible
As most food delivery drivers don’t work in set, predictable shifts, this flexible insurance that can be switched on and off is a great option. Drivers won’t have to pay while they’re waiting for a delivery to come in.
No annual commitment
Annual policies can quickly become expensive. When a driver is already paying for an SD&P policy, not having to pay for annual courier insurance on top of that is a major benefit.
Who needs pay as you go food delivery insurance?
Pay as you go food delivery insurance is a great option for:
- Uber Eats drivers
- Just Eat drivers
- Deliveroo drivers
- Amazon Flex delivery drivers
- Local restaurant delivery drivers
- Groceries delivery drivers
- Bike couriers
- Scooter or moped couriers
It’s the perfect insurance cover for someone who only does deliveries part-time, e.g. a student who does it as holiday work.
What are the types of pay as you go food delivery insurance?
There are two types of pay as you go delivery insurance, based on how it is charged by the insurance company:
- Pay per mile: This type uses a black box device that records how many miles are driven when you’re out on deliveries. Since the insurance cost is based on distance driven, it will benefit occasional delivery drivers.
- Pay per hour: This insurance policy is charged based on how much time is spent doing deliveries, not how far is driven. This will suit a delivery driver who does seasonal work.
What is covered by pay as you go delivery insurance?
Each policy differs based on the insurance company, but the following are typically covered by a PAYG insurance policy:
- Third-party liability: Covers damage caused by you to another person or their property.
- Own vehicle damage: Covers repairs or replacement if the insured vehicle is damaged while doing deliveries.
- Personal injury: Covers medical bills for injuries sustained during an accident while out on deliveries. This also covers any lost wages.
- Goods in transit: Protects the food you’re transporting and will pay to replace any lost or damaged items.
- Legal expenses: Covers the legal costs if you’re involved in a dispute due to your delivery work.
What’s not covered?
- Personal use: You will not be covered if you use your delivery vehicle for social or other business purposes.
- Mechanical breakdowns: The cost of vehicle breakdowns is usually not covered; however, you can get breakdown cover as a policy add-on.
- Intentional damage: If you intentionally damage your vehicle in the hope of an insurance payout, it won’t be covered.
- Uninsured drivers: Anyone doing deliveries that are not included in the policy won’t be covered.
- Driving under the influence: If you’re driving under the influence of drugs or alcohol and cause an accident, your insurance policy will be void.
How much does pay as you go food delivery insurance cost?
The cost of your PAYG insurance policy will depend on the type of vehicle you’re driving and whether you opt for “per mile” or “per hour” cover. However, here’s a breakdown of average insurance costs per hour:
| Vehicle Type | Average Insurance Cost per Hour |
|---|---|
| Scooter | £0.50 – £0.60 |
| Motorbike | £0.70 – £0.80 |
| Small, economical car | £0.75 – £0.85 |
| Standard car | £0.85 – £3.00 |
| Small van | £1.00 – £2.00 |
| Large van | £2.00 – £3.00 |
Which factors influence the cost of PAYG insurance?
- Type of vehicle you drive
- Driver’s age and driving history
- Location (high crimes or more congested areas will have higher rates)
- Mileage
- Claims history
- The time of day deliveries are made
- Security features on the delivery vehicle
How can you reduce the cost of your pay as you go delivery insurance?
Here are some top tips to reduce how much you pay for your PAYG food delivery insurance:
- Compare insurance quotes from industry-leading insurance providers with SimplyQuote.
- Increase your voluntary excess to reduce your premiums.
- Enhance the security of your delivery vehicle by installing an alarm, immobiliser, etc.
- Maintain a clean driving record to avoid claims.
- Bundle policies, for example, if you want an SD&P and PAYG policy.
- Choose a vehicle that is cheaper to insure, e.g. one with a smaller engine or lower value.
- Opt for black box technology and drive responsibly.
Final thoughts
Pay as you go food delivery insurance is the perfect solution for fast food delivery drivers who only do deliveries part-time. It is a cost-effective solution, as the delivery driver only has to pay for insurance when out on deliveries.
If you are interested in getting PAYG insurance, use the free, online comparison tool from SimplyQuote to get insurance quotes from the UK’s leading insurance providers. It is easy to use, has no obligations, and you can get affordable quotes in minutes.
Frequently Asked Questions
You need standard car insurance (for personal use) and a valid UK/EU driving licence before you can get pay as you go insurance.
You don’t need pay as you go insurance to deliver food; however, you will need a type of hire and reward courier insurance to be legally compliant in the UK.
You need a type of courier insurance, which can include:
- Hire and reward insurance
- Uber Eats insurance
- Just Eat insurance
- Deliveroo insurance
- Pay as you go insurance