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It is no secret that consumers are leading extremely busy lives. In many families, both the partners are working and as a result, neither had the time to cook food. This is where food delivery apps come in handy.
Apps like UberEats deliver restaurant food to the consumer at very little extra costs. There are many cloud kitchens that have come into existence ever since food delivery apps came into the business.
These food kitchens do not provide a dine-in experience. Instead, they only serve take away food.
There is no doubt that the restaurant industry has been benefitting from the rise of food delivery apps. The number of orders received from food delivery apps has gone up by over 50%. The overall revenue of the restaurant industry in America has gone up for the first time in many years.
At the present moment, restaurants are busy rejoicing in their new-found glory. However, it can be said that they may be blissfully unaware of the dangers that may be lurking in the background. It is true that food delivery apps have become a major source of revenue.
However, they could also become a major source of liability if proper precautions are not taken.
It needs to be understood that food delivery apps are much larger and much more sophisticated organizations as compared to restaurants. This is the reason when the negotiations are being done, and the contract is about to be signed, the food delivery apps tend to have the upper hand.
They have standard contracts which they get all their restaurant partners to sign. Some of these contracts push the risk entirely to the restaurant partners. These contracts state that the apps are only a mechanism to connect the consumer with the restaurant.
Hence, all the risks that arise during the service delivery process need to be borne by the restaurant itself.
It is, therefore, the restaurants that need to have extensive insurance covers and not the food delivery apps.
Some of the major risks that are faced while delivering food have been listed in this article.
Hence, if delivery personnel accidentally hits a pedestrian resulting in a $50,000 claim, who is going to pay it? The motor insurance company will deny payment of any claim on the pretext that the vehicle was being used for commercial purposes and not personal purposes. The food delivery apps have a legal team which has already restricted their liability.
In such cases, it is likely that the restaurants will become vulnerable to the claim.
It is therefore advisable for the restaurants to have some sort of policy in place as well to cover such unexpected losses. Restaurants can set aside some of the money generated by online sales to buy an insurance policy. This will help them continue their business without any interruptions.
Since food items are consumed by people, if they are unfit for consumption, severe medical issues may occur. These medical issues may also mean that the restaurant may have to incur huge medical costs.
Some food delivery apps are restricting the damage by providing seals which can be used to pack the container. These seals get damaged when the container is opened, and hence the customer will know if the food is adulterated. If the restaurant has taken out a general liability policy, such damages will be covered, and the restaurant’s interests will be protected.
In such cases, two types of damages may be faced.
Firstly, the worker might be injured. Those claims can be taken care of under workman’s compensation claims.
Secondly, the cash may also be robbed. If the cash is robbed and the damage is not made whole, the loss obviously accrues to the restaurant rather than to the delivery service. This is the reason why it is important that restaurants insist on electronic payments only.
This will help protect them from such robberies. Also, several food delivery services have employees who aggregate cash from several delivery personnel and deposit it into the bank multiple times in a day. This also helps lower risks.
However, if such damages occur on the restaurant’s premises, the restaurant may be held accountable. This is truer if there is spilt water or oil, or any other such catalyst that caused the accident. This is the reason why restaurants need insurance to protect themselves in such cases.
To sum it up, food delivery apps are a new opportunity that the restaurant industry is taking advantage of. However, the industry also needs to be aware of the threats associated with this responsibility and the insurance coverage that is required to protect themselves.
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