Tennessee Delivery Driver Insurance Law Starts in January

Insurance News · Tennessee Drivers

If you deliver food, groceries, or packages in Tennessee using your own car and a delivery company’s smartphone application, the insurance rules that apply to you are about to change. Tennessee Public Chapter 1011, which started as House Bill 2175 and was signed by Governor Bill Lee on May 19, 2026, takes effect on January 1, 2027. It sets minimum liability insurance requirements for delivery work, spells out who has to carry that insurance, and confirms that your personal auto insurance company may exclude coverage while you are working. This guide explains the new law in plain language, walks through the moments when you are and are not covered, and lists the practical steps to take before the new year.

Why Tennessee Passed a Delivery Driver Insurance Law

Delivery work through smartphone platforms has grown quickly across Nashville, Memphis, Knoxville, Chattanooga, and smaller Tennessee towns. Most of these drivers use the same car they use for commuting and errands, and most of them carry an ordinary personal auto policy. The problem is that a personal auto policy is written for personal driving. Many policies contain what insurance professionals call a business use exclusion or a delivery exclusion, which is a clause that removes coverage when the car is being used to carry goods for a fee. When an accident happens during a delivery, the driver, the injured person, and the insurance companies can end up arguing about whose policy should pay, and sometimes nobody’s policy clearly applies.

Tennessee already had separate rules for ride-hailing companies that carry passengers. Public Chapter 1011 creates a similar framework for companies that carry goods instead of people, which the law calls delivery network companies. The goal is to make sure there is always a minimum amount of liability insurance in place while a delivery driver is working, and to make the handoff between personal and business coverage less confusing for everyone involved.

Who the New Law Covers

The law applies to delivery network companies, meaning businesses that use a digital network, such as a website or smartphone application, to connect customers with drivers who deliver goods. It also applies to the drivers themselves, which the law defines as individuals who provide delivery services through one of these digital networks using a personal vehicle. If you drive for one or more food, grocery, retail, or package delivery platforms in Tennessee in your own car, truck, or sport utility vehicle, this law is written about you.

The law does not change the rules for traditional commercial delivery operations where the business owns the vehicles and insures them on a commercial auto policy. If you own a small business and your employees make deliveries in company vehicles, those vehicles should already be on a business auto policy. If your employees sometimes run deliveries in their own cars, read our guide on how hired and non-owned auto coverage works for businesses, because that coverage protects the business rather than the employee’s car.

The Two Working Periods the Law Defines

The most important part of the law is the way it divides a delivery driver’s time into periods. Understanding these periods tells you which insurance is supposed to apply at any given moment.

The Delivery Availability Period

The delivery availability period is the time when you are driving your personal vehicle, you are logged in to the delivery company’s digital network, and you are eligible to receive delivery requests, but you have not yet accepted an order. In everyday terms, this is the time you spend driving around or parked with the platform turned on, waiting for the next order to come in.

The Delivery Service Period

The delivery service period begins when you start driving to pick up an order or a series of orders, as documented by the delivery company’s digital network. It continues while you transport the goods, and it ends when the requested goods are delivered. In everyday terms, this is the time between accepting an order and handing it to the customer.

Personal Driving Time

Any time you are not logged in to a delivery network and not completing a delivery, you are simply a personal driver again. The new law specifically says it does not relieve you of Tennessee’s normal financial responsibility requirements during that time. Financial responsibility is the legal duty to be able to pay for damage you cause, which most drivers meet by carrying an auto insurance policy with at least the state minimum limits of $25,000 for injury to one person, $50,000 for injuries to everyone in one accident, and $25,000 for property damage. You can review those basics in our guide to Tennessee auto and home insurance rules.

The Minimum Insurance Required While You Work

During both the delivery availability period and the delivery service period, the law requires liability insurance that protects the driver against claims from other people. Liability insurance is the part of an auto policy that pays for injuries and property damage you cause to others, along with the cost of defending you if you are sued. The required minimums are $50,000 for bodily injury to any one person in an accident, $100,000 for bodily injury to all people injured in one accident, and $25,000 for damage to or destruction of property. Those limits are twice the normal Tennessee minimums for the two injury categories, which reflects the extra time delivery drivers spend on the road.

The law lets the driver, the delivery company, or a combination of the two maintain this insurance. The coverage must be primary, which means it pays first rather than waiting for another policy to pay, and it must either recognize that the driver is making deliveries or at least not exclude coverage for using a personal vehicle to make deliveries. The insurance may come from a company licensed in Tennessee or from an eligible surplus lines insurance company, which is a company that is allowed to write specialized or harder-to-place risks in the state without being formally licensed there.

The Safety Net When Your Own Coverage Fails

One of the most driver-friendly parts of the law addresses gaps. If the insurance a driver maintains has lapsed or does not provide the required coverage, the insurance maintained by the delivery company must provide the required coverage, and it has a duty to defend the claim, meaning it must provide and pay for a legal defense. The delivery company’s coverage also cannot depend on another insurance company denying the claim first. In practice, this means an injured person should not be stuck waiting while two insurance companies argue, and a driver should not be left with no liability protection simply because a personal policy excluded delivery work.

The law also helps settle disputes about timing. When asked, the delivery company or its insurance company must immediately provide the precise times that a driver started and ended the availability period or the service period during the 12 hours before and after an accident. If there is a dispute about when a period began or ended and the delivery company does not have the information to settle it, the delivery company’s insurance company must take on primary liability for the claim.

What Your Personal Auto Policy May Exclude

This is the part of the law that most surprises drivers. Public Chapter 1011 confirms that any insurance company writing auto liability insurance in Tennessee may exclude any and all coverage, as well as the duty to defend or pay claims, for losses that happen during the delivery availability period and the delivery service period. That right to exclude can apply to every coverage in the policy, not just liability. Depending on your policy wording, that could include:

• Collision coverage, which pays to repair your own car after a crash, so a fender bender during a delivery could leave you paying for your own repairs.
• Comprehensive coverage, which pays for theft, hail, vandalism, and hitting an animal, so damage to your car while parked outside a restaurant waiting for an order may not be covered.
• Medical payments coverage, which helps pay medical bills for you and your passengers regardless of fault.
• Uninsured and underinsured motorist coverage, which protects you when the other driver has no insurance or too little insurance. Our article on how uninsured motorist claims work in Tennessee explains why this coverage matters so much in this state.

The minimum insurance the law requires is liability coverage for injuries and damage you cause to other people. It does not require anyone to repair your car or pay your own medical bills. Some delivery companies choose to provide extra coverage for drivers during certain periods, but the law does not require it, and the amount and terms vary by platform.

New Disclosure Requirements

Before a driver is allowed to accept a delivery request, the delivery company must tell the driver in writing what insurance coverage and limits it provides while the driver is using a vehicle on its network, and that the driver’s own insurance policy may not provide coverage during the availability and service periods. Insurance companies and delivery companies must also cooperate during claim investigations and share the coverages, exclusions, and limits of the policies involved. If you already drive for a platform, watch for updated insurance terms near the end of 2026 and save a copy for your records.

Steps Tennessee Delivery Drivers Should Take Before January 1, 2027

1. Read your current auto policy or call your agent. Ask directly whether your policy excludes delivery work, and whether that exclusion applies to every coverage or only some of them. Do not assume that a policy you bought years ago still fits how you use your car today.
2. Tell your insurance company that you deliver. Leaving out delivery work on an application can create problems when you file a claim. Many insurance companies now offer an endorsement, which is an add-on that changes the policy, that extends personal coverage to delivery or ride-hailing periods for a modest additional cost.
3. Find out what the delivery company provides. Read the written insurance disclosure each platform gives you, note which periods have liability only and which, if any, include coverage for damage to your own car, and keep a copy.
4. Think about your own car and your own injuries. If you could not afford to repair or replace your vehicle out of pocket, closing the physical damage gap during delivery work is likely worth the cost.
5. Keep your personal policy active. The delivery company’s insurance only satisfies Tennessee’s financial responsibility law while you are logged in or delivering. You still need your own policy for all other driving.
6. Consider whether you have outgrown personal coverage. If delivery has become a full-time business with multiple vehicles or employees, a commercial policy may be the better fit. Our guide to commercial auto insurance in Tennessee and the article is commercial auto insurance right for you can help you decide.

How This Compares With Ride-Hailing Rules

Drivers who carry passengers have lived with a similar structure for years, with different insurance responsibilities depending on whether the driver is waiting for a ride request, heading to a pickup, or carrying a passenger. If you have read our explainer on the basics of Texas rideshare insurance, the Tennessee delivery law will look familiar: personal coverage for personal driving, required business coverage while working, and a real risk of a gap for damage to your own car. The key difference for Tennessee delivery drivers is that the new rules do not start until January 1, 2027, so this is the right time to review your coverage before the first renewal of the new year.

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