A state order designed to assist restaurants that have begun delivery service amid the COVID-19 coronavirus crisis could give a needed boost to some mom-and-pop shops, like Red Lion Singapore Grill and Japanese Cuisine on Cottage Grove Road.
Insurance commissioner Mark Afable on Monday ordered insurers operating in Wisconsin to help restaurants that have begun offering delivery service.
Gov. Tony Evers, while requiring the nearly 13,000 restaurants across Wisconsin to close, has allowed them to continue offering delivery and pickup service.
Afable’s order says that insurers must cover delivery services for restaurants on drivers’ personal auto insurance policies and must offer coverage for hired drivers and non-owned automobiles as a rider on a restaurant’s general liability insurance if requested. The order says that both will come at no extra cost to the policyholders.
The measure doesn’t change existing policies that cover delivery services. It only applies to drivers and businesses doing delivery that don’t currently have delivery coverage in their policies.
For example, it will cover a server who is now delivering food in his or her personal car. If drivers already have insurance on their personal vehicle, insurers cannot deny a claim because they were delivering food. Drivers don’t need to request this coverage.
Another example would be a restaurant with a general liability insurance policy that didn’t do delivery before but is doing it now. The owner can call his or her insurance company and ask to have a rider added to the restaurant’s existing policy to cover delivery service.
In these challenging times, our local businesses need your support. Find out how to get food, goods, services and more from those remaining open.
Jeffrey Cui, who opened Red Lion last year with his wife, Jessica Cui, said he uses the Madison-based EatStreet delivery service as well as Uber Eats. But under the restriction to just take-out and delivery, he and his wife are making delivery trips as well.
Under the new order, Cui said he can ask his sister to start making deliveries, too. “My insurance wouldn’t cover her, so I believe it’s helping,” he said of the measure.
Cui said they’ve been filling 10 to 15 take-out orders per day and another five to 10 delivery orders.
J.J. Kilmer, who owns Indie Coffee on Regent Street with her husband, Barrett Kilmer, calls the measure “a step in the right direction.” But what she really would like to see is property tax and licensing-fee relief.
“Sure, it’s great to get insurance for deliveries,” Kilmer said. “But many of us without delivery experience are now tasked with implementing an impromptu delivery system while concurrently just running our businesses under new rules.”
She said she doesn’t want to rely on delivery services, which take a big chunk out of every sale. “This would be a failed business model in the post-virus world,” she said.
More than 500 restaurants in the Madison area use EatStreet, including restaurants in Sun Prairie, Fitchburg, Monona, Middleton and Verona. The company has 203 drivers in Madison and 1,300 total delivery drivers in the U.S.
Matt Howard, EatStreet co-founder and CEO, said all EatStreet drivers are required to have insurance, and as a delivery company it already has all necessary coverage in place.
While the order won’t impact EatStreet directly, Howard said, “We’re fans of anything that can be done to alleviate the financial challenges our restaurant partners currently face. If this order makes it easier for them to offer delivery, we support it.”
Deb Watterson, who owns Sugar River Pizza locations in Verona and New Glarus with her husband, Daryl Watterson, and a third on the way in Sun Prairie, called the insurance order good news.
“It speaks to the challenges our restaurants are going through right now,” Watterson said. “All restaurants are trying to retain as many staff as we can, and this gives us the opportunity to retain more employees and move them where the business is, which is in the delivery and carryout area.”
The other promising development for her is that construction has been deemed an essential industry, which means work won’t have to slow down on the Sun Prairie location, currently on target to open in late summer or early fall.
Watterson said the support she’s seen from the community has been overwhelming. “Not only do they buy, but they offer words of encouragement.”
Eliot Butler, president of Great Dane Pub & Brewing Co., said the four Madison area Great Danes are working with EatStreet and plan to start using GrubHub within the next week for all its food deliveries. This way, they don’t have to manage drivers, insurance and other challenges that come with it.
“Every restaurant is different, though, and I suspect the order will definitely eliminate some barriers to offering delivery,” Butler said, “especially in Wisconsin cities that don’t have adequate third-party services.”
Photos: A look at how COVID-19 is affecting Wisconsin
“We’re fans of anything that can be done to alleviate the financial challenges our restaurant partners currently face.” Matt Howard, EatStreet co-founder and CEO
"We’re fans of anything that can be done to alleviate the financial challenges our restaurant partners currently face."
Matt Howard, EatStreet co-founder and CEO
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Wisconsin State Journal feature writer Samara Kalk Derby writes about the arts and brings you the latest news on the Madison area's eclectic restaurant scene. She can be reached at firstname.lastname@example.org or 608-252-6439.