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The Pizza Exclusion

Close up photo of a person holding pizzaHave You Heard of The “pizza” Exclusion?

If you make any deliveries in exchange for payment, you need to know about this exclusion. In general, where this exclusion applies, it allows your insurance company to deny coverage if at the time of a collision you were engaged in the delivery of any goods. Because of cases involving pizza-delivery drivers, many of whom used their own vehicles and did not consider whether this affected their insurance coverage, this exclusion earned the nickname the pizza exclusion.

If your policy includes this exclusion, or a more general business use exclusion, you may not be fully covered if you get into an accident.

When it comes to uninsured or underinsured motorist coverage, however, a pizza exclusion may not be valid. New Mexico public policy strongly favors the application of uninsured motorist coverage, and any exclusions must be specifically allowed by law.

In 2019, in a case brought by Stalter Law, a New Mexico district court judge ruled that Liberty Mutual's pizza exclusion was invalid with respect to uninsured motorist coverage.