Your car insurance almost certainly doesn't cover you while you're delivering for Shipt. Not partially. Not in some gray area. Your policy has a clause that excludes coverage when you use your vehicle to carry property for compensation. It's usually called a "livery exclusion" or "business use exclusion." Some newer policies spell it out even more directly, excluding "the pickup or delivery of food or any products for compensation."
Every time you drive to Target, shop an order, load the bags, and head to the customer's house, there's a good chance you're doing something your insurance company specifically said they won't cover. And most shoppers have no idea.
What Shipt requires, and whether your insurer finds out
Shipt's side is short. Its insurance FAQ says the Independent Contractor Agreement requires auto insurance that meets or beats your state's minimum, and that Shipt may ask for proof of it at any time. That's why it wants your policy information during sign-up.
Two more rules from the same page. You have to be insured on the policy for whatever car you drive, even if the car isn't yours. And Shipt won't accept coverage that comes only through a rideshare or rental company. Some states or insurers may require extra coverage for gig work, and Shipt says to check with yours.
Nothing on that page says Shipt reports your work to your insurance company, or checks whether your policy covers delivery. Having a policy on file with Shipt and being covered while you deliver are two different things.
Your insurer usually learns you do Shipt the same way everybody's does: at the claim.
What happens if you crash during a delivery
You file a claim. The adjuster asks what you were doing. You tell them, or they find out from the police report, or they see the insulated bags in your back seat photos. Doesn't matter how they find out. Once they know you were delivering, the claim gets denied.
Not reduced. Denied. Liability, collision, medical payments, all of it. Gone.
A Spark driver in Dunbar, Pennsylvania veered off a customer's driveway and hit a gas meter. Broke the high-pressure line. The homeowner, a mother of three, got stuck with a $20,000 repair estimate and a $5,000 deductible out of pocket. The driver had personal insurance only. Walmart didn't require or verify anything beyond that.
An Instacart driver in Richmond backed into a customer's garage door. Both the driver's and homeowner's insurance claims were denied because the car was being used for business.
These aren't hypotheticals. And it gets worse. Your insurer can cancel your entire policy for not disclosing that you do delivery work. So now you're uninsured, mid-claim, with damages you owe.
What Shipt actually covers
For the car, not much. Shipt's insurance FAQ doesn't describe any auto policy of Shipt's that pays for your car or for the car you hit.
What Shipt does provide is occupational accident insurance, and a lot of shoppers don't know they have it. Every active shopper is enrolled automatically, and Shipt pays for it. If you're hurt while active on the platform, it covers medical expenses up to $1,000,000, disability payments replacing earnings up to $500 a week, and up to $250,000 for accidental death or dismemberment. Claims go to Intact Insurance, not Shipt.
That's coverage for your body. It isn't car insurance.
Your car is totaled? The accident policy won't fix it. Your vehicle is already the biggest cost in the job, and this is the scenario where it stops being gradual. Your bumper, your windshield, your axle that got bent in a pothole. None of that. It won't pay the other driver either, or the homeowner whose garage door you just backed into. That's liability, and liability is exactly what your personal policy excluded the moment the trip became a delivery run.
So picture the at-fault crash with groceries in the back. Your injuries have a backstop. Your car, their car, and their medical bills don't.
If the accident is the other driver's fault, their insurance may cover your damages, depending on which state you're in. The problem is when you're at fault, or when the other driver is uninsured. That's when you'd normally lean on your own collision and uninsured motorist coverage. Except your policy excluded this trip. So your car sits in a body shop and you're writing a personal check.
The real risk window
The biggest exposure is when you clearly have a customer's order in your car and you're at fault in an accident. Bags of groceries in the back seat, a Shipt lanyard on your mirror, insulated bags visible in the photos. That's when an insurance adjuster can piece together that this was a delivery trip and deny your claim.
Technically, your personal policy excludes you anytime you're using the car for business, even driving to the store or heading home after a drop-off, which is the same unpaid mileage the IRS lets you deduct. But realistically, if you don't have someone's groceries visible in the car, there's not much for an adjuster to work with. The practical risk scales with how obvious it is.
Where it gets unavoidable is the at-fault accident mid-delivery. You rear-end someone with 6 Target bags in your trunk. Your insurer denies the claim. Shipt's accident policy can help with your own injuries, but the other driver's car, their injuries, and yours are on you. That's the scenario that actually ruins people.
The fix: rideshare and delivery endorsements
Call your insurance company and ask about a rideshare or delivery endorsement. This is an add-on to your existing personal policy that extends coverage to when you're using your car for gig work. It closes the gap.
Price depends on your state, your insurer and your record, so the only number that matters is your own quote. It's an add-on to the policy you already have, not a second policy, and it costs a lot less than finding out the hard way.
One thing to watch out for. A lot of these endorsements were built for Uber and Lyft passenger rideshare. They don't all automatically cover delivery work. When you call, specifically say you deliver groceries for Shipt. Get confirmation that delivery is covered, not just rideshare. Get it in writing if you can.
If you're doing this full-time across multiple platforms, a commercial auto policy might make more sense. Those cost a good deal more. Expensive, but there's zero ambiguity about coverage. Everything is covered because the policy is built for business use.
A few states are fixing this
Kentucky passed the strongest law, and it took effect January 1, 2025. Under KRS 365.532, delivery platforms have to make sure primary liability coverage that doesn't exclude delivery is in place the whole time you're logged in, including while you're waiting for an offer. If your own coverage has lapsed or won't pay for delivery, the platform's insurance has to cover the claim from the first dollar, and it can't make your insurer deny it first. That's how it should work everywhere.
Washington state requires ride-share companies to provide workers' comp and paid sick leave based on hours worked. The state insurance commissioner put out a specific warning that personal auto policies don't cover gig work.
Most states haven't caught up yet. The burden is still on you to figure out your own coverage.
What to do right now
Call your insurer. Ask if your policy covers delivery work. It almost certainly doesn't. Then ask what it costs to add a delivery or rideshare endorsement. Get the number before you decide it's too expensive.
The endorsement premium is itself a business expense, which the tax guide gets into. If your current insurer doesn't offer one, shop around. State Farm, Progressive, Allstate, and American Family all have options. Switch if you have to. Driving uninsured is a worse deal than any no-tip order you've ever taken.
Don't assume Shipt's got you covered. Its accident policy is for your injuries. Your car, and whatever you hit, ride on your own policy, and one accident without proper coverage can wipe out a year of earnings before you even get to the medical bills.
Quick answers
Does Shipt require car insurance? Yes. Shipt's Independent Contractor Agreement requires auto insurance that meets or exceeds your state's minimum, and Shipt may ask for proof of it at any time. You have to be insured on the policy for the car you drive.
Does your insurance company know if you do Shipt? Not from Shipt, based on what Shipt publishes. Its insurance FAQ doesn't say it reports your work to your insurer. Insurers usually find out at a claim, from what you tell the adjuster, the police report, or what's in the car.
Does Shipt cover you in a car accident? Shipt provides free occupational accident insurance for your own injuries while you're active on the platform: medical expenses up to $1,000,000, disability up to $500 a week, and up to $250,000 for accidental death or dismemberment. It doesn't describe any auto policy that pays for your car or the other driver's.
What insurance do Shipt shoppers need? A personal auto policy that meets your state's minimum, which Shipt requires, plus a delivery or rideshare endorsement or a commercial policy so the delivery drives themselves are covered.
Auto Tip Map is an Android app for Shipt shoppers that tracks your orders, tips, mileage, earnings stats, and estimated fuel costs.