Amazon Delivery Service Partner owners are exiting the program because rising insurance premiums consume their margins while Amazon controls route density and per-package rates

Amazon DSP (Delivery Service Partner) owners -- independent contractors who operate fleets of 20-40 branded vans delivering Amazon packages -- are seeing annual profits collapse from $400,000 to as low as $150,000 due to skyrocketing commercial auto insurance premiums, while Amazon unilaterally controls the per-package rate, route assignments, and delivery quotas with no negotiation. Why it matters: DSP owners cannot absorb insurance cost increases because Amazon sets fixed compensation rates, so experienced DSP operators exit the program (Bloomberg interviewed 23 DSP owners in 11 states in 2025, with five having quit and several more contemplating it), so Amazon must constantly onboard inexperienced replacement operators, so new operators have higher accident rates which further drive up industry insurance premiums, so driver pay stagnates (averaging $22/hour as of September 2024) and turnover exceeds 100% annually across last-mile delivery, so delivery quality degrades in the neighborhoods served by churning DSPs. The structural root cause is that Amazon's DSP model creates an asymmetric power relationship where the platform captures the customer relationship and sets all economic terms, while the DSP owner bears all operational risk -- insurance, labor, fuel, vehicle maintenance -- with no ability to diversify revenue since the vans are Amazon-branded and routes are Amazon-exclusive.