Insurance for Courier and Delivery Businesses
A courier is paid to carry someone else’s goods, and California treats that as motor carrier work whatever the vehicle weighs. We look for courier insurance and food delivery insurance that fits your permit, your drivers and the cars they use, and an insurer decides after reviewing your vehicles, routes and driving records.
Any paid delivery needs a Motor Carrier Permit
The DMV requires a Motor Carrier Permit from any person or business paid to transport property in a motor vehicle, regardless of its size, type or weight, and its own example is a courier service using a motorcycle. Vehicle Code 34601 reaches past heavy trucks to “any other motor vehicle used to transport property for compensation.” The CA number, issued only by the California Highway Patrol, serves as the permit number.
Every carrier must prove workers’ comp compliance by certificate or signed exemption, and a carrier employing only family members still needs it. Letting the liability or workers’ comp insurance lapse can suspend the permit. Carriers that haul only U.S. Mail under a USPS contract are outside the program.
The liability limits a courier permit sets
Vehicle Code 34631.5 sets the floor at a $750,000 combined single limit for motor carriers of property in general, and $300,000 for carriers that run only vehicles under 10,000 pounds gross vehicle weight rating and haul no hazardous materials or bulk petroleum. Neither figure covers the cargo. For scale, California’s general auto minimum from January 1, 2025 is $30,000 per person and $60,000 per accident for bodily injury.
Company cars, vans and motorcycles go on commercial auto with the permit filing. Heavier freight hauling is covered on our box truck page, and Amazon delivery partners on Amazon DSP insurance.
Personal cars on the route: hired and non-owned auto
California’s Insurance Commissioner noted in an April 10, 2020 release that personal auto policies do not typically provide coverage for vehicles used for commercial purposes. If a driver’s insurer turns down a delivery crash on that ground, the injured person looks to the business that sent the driver out.
Hired and non-owned auto answers the business’s liability when an employee drives a personal car for work, or when you rent a van for a peak week. In the ISO business auto form, symbol 8 means hired autos and symbol 9 means non-owned autos, employees’ cars included; symbol 1, any auto, takes in both. It is liability only. It does not repair the employee’s car, and a rental needs physical damage cover of its own.
Food delivery insurance: app drivers, restaurants and Prop 22
Proposition 22, Business and Professions Code 7451, took effect on December 16, 2020. It treats an app-based driver as an independent contractor of a network company when its conditions are met, such as no set hours and no duty to accept particular requests, and the California Supreme Court upheld it in Castellanos v. State of California on July 25, 2024. Section 7455 makes the network company provide occupational accident insurance while drivers are online, with at least $1,000,000 in medical expenses and disability pay of 66% of average weekly earnings for up to 104 weeks, plus accidental death cover. A delivery network company must also carry at least $1,000,000 per occurrence in third-party auto liability during engaged time when the car has no other compliant policy.
Those protections attach to drivers on a platform while they are online or engaged. They do not reach a local courier company’s own drivers or a restaurant’s in-house delivery staff. A restaurant that runs its own delivery needs hired and non-owned auto plus a delivery endorsement or commercial policy for the drivers’ cars, which we request as part of the restaurant’s program.
Drivers, the ABC test and workers’ comp
Under Labor Code 2775, a worker is an employee unless the hiring business proves all three prongs of the ABC test: freedom from control, work outside the usual course of the hiring business, and an independently established trade or business. Prong B is the hard one for a courier company, because delivery is its usual course. Section 2776 keeps the older Borello test for qualifying business-to-business arrangements; our guide to employees and independent contractors walks through both.
When drivers paid as contractors turn out to be employees, an injured driver has a workers’ comp claim the company never insured. WCIRB code 7198(1), parcel delivery and messenger service companies, applies when fewer than 10% of parcels weigh over 100 pounds and fewer than 10% of deliveries exceed 200 pounds per stop, and expressly includes app-based meal, grocery and errand delivery. The code’s pure premium rate, an advisory benchmark per $100 of payroll, is $10.620 from September 1, 2026, up from $10.100, against $7.318 for 7219(1) trucking. Occupational accident policies suit true independent contractors and do not replace workers’ compensation for employees.
Parcels, cold chain and the delivery stop
The permit minimums expressly leave out the goods being carried, so a lost box, stolen parcel, missing legal documents or a cooler of samples that warms in traffic fall outside the auto liability limit. We ask insurers about motor truck cargo or inland marine cover sized to the most valuable load a single driver carries.
General liability covers what happens at the stop rather than on the road, such as a hand truck that gouges a lobby floor. Loading strains, dog bites and slips on a wet step are employee injuries for workers’ comp. Forward any customer certificate request before the first run.
What courier insurance costs
MoneyGeek’s courier cost page, updated September 29, 2026, publishes modeled estimates rather than medians of real policies: premiums built from quote data from 10 large U.S. commercial insurers for courier services with 1 to 4 employees, with general liability at $1 million / $2 million and commercial auto at minimum coverage. For California it shows commercial auto at $292 a month ($3,507 a year), general liability at $90 a month ($1,083 a year), cyber at $61 a month ($726 a year) and workers’ comp at $1,101 a month ($13,207 a year), shown per employee in its state table. They are published estimates for the smallest operators, not a Mithril1 quote; larger fleets pay well above them.
Auto is rated on the vehicles and the people driving them, and workers’ comp on each $100 of payroll in a code whose benchmark sits above trucking’s. MoneyGeek’s California auto and general liability estimates add up to about $4,590 a year before workers’ comp. Because its auto estimate is modeled at minimum coverage, a carrier filing the $300,000 or $750,000 permit limit should expect to start higher.
Premiums climb with more or heavier vehicles, longer routes, drivers with tickets, high-value or temperature-sensitive loads and contracts calling for higher limits. They come down with clean driving records, written hiring rules, vehicle checks, signed proof of delivery and a short claim history. Each insurer quotes once it has read your vehicle list and driving records.
A few useful answers
Common questions
Does my personal auto policy cover deliveries?
Usually not. The California Insurance Commissioner has said personal auto policies do not typically cover vehicles used for commercial purposes, so a delivery crash can land on the business. Hired and non-owned auto covers the business’s liability when employees drive their own cars.
Do I need a Motor Carrier Permit for a car or van courier business?
The DMV requires one from anyone paid to transport property in a motor vehicle, whatever its size or weight. The permit needs a CA number from the CHP, a liability filing at the Vehicle Code 34631.5 minimum and proof of workers’ comp.
Does the delivery app’s food delivery insurance cover my restaurant’s own drivers?
No. The Prop 22 coverages protect app-based drivers on a network company’s platform while they are online or engaged. Drivers you employ need your own hired and non-owned auto and a policy for the cars they drive.
Is cargo covered by my commercial auto policy?
Not by the liability limit. The permit minimums exclude the cargo being carried, so customers’ goods need cargo or inland marine cover of their own.
Can a new courier company get courier insurance through Mithril1?
It can, provided an insurer accepts the vehicles, drivers and delivery types you list. We request commercial auto with the permit filing, hired and non-owned auto and workers’ comp together, so the permit paperwork and the policies line up.