1099 Drivers: Why Your Cargo Van Probably Needs Commercial Auto Insurance

At Ports O’ Call Insurance, we’ve noticed a trend: more and more people are calling us for personal auto insurance quotes, but after a few questions, we realize what they really need is commercial auto coverage. It’s an easy mistake to make. If you’re a 1099 independent contractor driving a cargo van, pickup, or work vehicle in California, you might think a personal auto policy is enough. The reality? Personal auto insurance usually excludes business use.

Personal Auto vs. Commercial Auto: What’s the Difference?

- Personal Auto Insurance covers your car for personal errands, commuting, and family use.- Commercial Auto Insurance is built for vehicles used primarily for business. It offers higher liability limits and covers situations that personal policies specifically exclude — like hauling equipment, making deliveries, or transporting goods for pay. If you’re using your van to make money, your personal policy can deny the claim. That means an accident on the job could leave you personally responsible for damages, injuries, and even lost wages.

Who Falls Into This Category?

We see it most often with:- Delivery drivers (Amazon Flex, local couriers, food services)- Contractors and trades (plumbers, electricians, handymen hauling tools)- Self-employed gig workers using their van for side hustles. If you get paid to drive — you’re in commercial territory.

Real-World Example

One local contractor came to us after an accident. He was hauling supplies to a job site in his van. His personal auto insurer denied part of the claim because the trip was work-related. In practice, many California carriers will only pay out the state minimum liability limits and then issue a non-renewal notice. That means the driver is left with thousands of dollars in uncovered losses and the headache of shopping for a new policy after being dropped. This isn’t rare. It’s written into the fine print of most personal auto policies.

Exceptions to the Rule

There are a couple of situations where commercial auto insurance may not be required:- W-2 Construction Employees: If you’re a W-2 employee (not a 1099) and you drive your own truck or van to the jobsite, your employer’s workers’ comp or commercial auto policy may cover you while you’re on the clock. In that case, a personal auto policy could still be valid for your off-duty use. The key is to confirm with your employer how coverage works while you’re working vs. commuting.- Independent Contractors for Transportation Network Companies (TNCs): Uber and Lyft provide liability coverage to their drivers while signed into the app, but there’s often a coverage gap when you’re waiting for a ride request. Some personal auto insurers offer a ride for hire endorsement that fills this gap. DoorDash and many delivery apps, however, do not provide the same type of coverage as Uber or Lyft. Most personal auto insurers also exclude food delivery, even with a ride for hire endorsement. In those cases, a full commercial auto policy may be the only solution.

Why It Matters in SoCal

Here in Long Beach, San Pedro, and Torrance, independent contractors are everywhere — especially in construction trades and local delivery. Many of these workers are technically self-employed, and that means they’re responsible for carrying the right coverage. Knowing whether you’re a W-2 employee, a 1099 contractor, or a TNC driver makes all the difference in whether you need commercial auto or a tailored personal policy with an endorsement.

Quick Comparison Chart

Don’t Get Stuck Without Coverage

If you’re a 1099, contractor, or gig worker driving for business:- Check your current policy. Look for exclusions about “business use” or “livery.”

Ask your employer. If you’re a W-2 employee, confirm whether their policy covers you while working.

Explore endorsements. If you drive for Uber or Lyft, ask about a ride for hire endorsement.- Consider commercial auto. If you’re in delivery or independent contracting, it’s the safest bet.

Final Word

Insurance should protect your livelihood, not just your car. If you’re working as a 1099 in California with a cargo van or work vehicle, chances are personal auto insurance won’t cut it — unless you fall into one of the exceptions above.

Before you find out the hard way, call us at Ports O’ Call Insurance. We’ll review your situation, explain your options, and help you get the right coverage in place so a single accident doesn’t derail your income or your insurance record.