We have had a couple of calls recently from members whose independent contractor newspaper carriers are complaining that their auto insurance policies are being canceled. We did a little investigation, and discovered that many of these independent contractors carry only personal auto insurance. So when their insurance companies find out that they are delivering papers, a “commercial” activity, the policies are canceled. 

This is a big problem for the newspapers affected, and could be a huge problem for all newspapers if this is the start of a trend in Pennsylvania. The bottom line is that paper carriers should be purchasing commercial auto insurance. We confirmed this week that coverage can be written in Pennsylvania. And we have a listing of agents that can provide this coverage. Coverage can even be quoted and issued over the Internet and can take as little as 10 minutes to complete. 

We also learned that commercial auto insurance coverage can be written to include an endorsement to name your paper as an additional insured in the event that a paper carrier is involved in an accident and the paper is named in a suit. 

What is the price differential? In an example given to us, a paper carrier with a 1996 Caprice Classic Station Wagon driving in central Pennsylvania would pay $869 a year for $300,000 of liability with a $250 deductible for comprehensive and a $500 deductible for collision. The paper can be named as an additional insured for an additional $25. 

A personal policy on the same vehicle would cost $600 for the same dollar amount of coverage. The problem is of course that in most personal auto insurance policies, commercial activities are excluded from the coverage. So the $600 policy would provide no coverage for any liability incurred while delivering papers. 

What does this mean for your paper? If one of your independent carriers has a personal auto insurance policies and is in an accident while delivering papers, damaging the property of a third party, the carrier’s insurance will not cover the losses. And the owner of the damaged property may look to the newspaper for satisfaction.

If your paper carriers have any problem arranging for the proper insurance coverage for their vehicle, have them call me at (717) 703-3067  or send an e-mail to me for information on companies that can help. 

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