What's happening
This bill establishes insurance requirements and regulatory guidelines for transportation network companies (like ride-sharing services) and their drivers in New York State.
Why it matters
Clarifies insurance responsibilities and coverage for ride-sharing drivers. The bill requires ride-share drivers (and/or the companies they work with) to carry primary automobile insurance that explicitly covers them while logged into the app or providing rides, establishing clear minimum coverage limits. This helps protect both drivers and passengers in the event of an accident, even if a driver’s personal policy doesn’t extend to commercial activity.
Allows for group insurance policies and defines insurer obligations. Transportation network companies (TNCs) can purchase group insurance policies that cover all affiliated drivers, with detailed rules on policy administration, premium contributions, dividends, and communication of policy changes or cancellations. This structure can make it easier for companies to manage coverage and for drivers to be insured without negotiating separate policies.
Lets insurers exclude coverage for ride-sharing activity from standard auto policies. The bill explicitly permits insurers to deny coverage for incidents occurring while a driver is engaged in TNC activity, reducing ambiguity and potential disputes over claims. This encourages drivers to ensure they have the right kind of insurance for ride-sharing and limits the risk for insurers.
Reserves local authority over certain regulations but preempts insurance rules. While local governments can regulate areas like driver background checks and other operational aspects, they cannot override or supplement the state-mandated insurance requirements. This balances statewide consistency in insurance standards with local oversight of public safety and business practices, except in large cities (like New York City), which retain more control over TNC operations.
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Who cares
Headline styles
Set Insurance Rules for Rideshares
Plain English, a few words. Used as the page title.
Sponsors
1 Co-sponsor
History
- Enacting clause stricken
- Referred to insurance
- Referred to insurance
Full text
9 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
6585
2017-2018 Regular Sessions
IN ASSEMBLY
March 9, 2017
Introduced by M. of A. WALTER -- read once and referred to the Committee on Insurance
AN ACT to amend the insurance law, in relation to transportation network companies
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The insurance law is amended by adding a new section 3441 to read as follows:
§ 3441. Transportation network companies. (a) Notwithstanding any other provision of this chapter, this section shall apply to transportation network companies.
(b) For purposes of this section the following definitions shall apply:
(1) "Personal vehicle" means a motor vehicle used by a transportation network company driver and is owned or leased by the transportation network company driver.
(2) "Digital network" means any online-enabled application, software, website or system offered or utilized by a transportation network company that enables the prearrangement of rides with transportation network company drivers.
(3) "Transportation network company" means a corporation, partnership, sole proprietorship, or other entity that is operating in this state that uses a digital network to connect transportation network company riders to transportation network company drivers who provide prearranged rides.
(4) "Transportation network company driver" or "driver" means an individual who:
(A) receives connections to potential riders and related services from a transportation network company in exchange for payment of a fee to the transportation network company; and
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD09188-01-7
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(B) uses a personal vehicle to offer or provide a prearranged ride to riders upon connection through a digital network controlled by a transportation network company in return for compensation or payment of a fee.
(5) "Transportation network company rider" or "rider" means an individual or persons who use a transportation network company's digital network to connect with a transportation network driver who provides prearranged rides to the rider in the driver's personal vehicle between points chosen by the rider.
(6) "Prearranged ride" means the provision of transportation by a driver to a rider, beginning when a driver accepts a ride requested by a rider through a digital network controlled by a transportation network company, continuing while the driver transports a requesting rider, and ending when the last requesting rider departs from the personal vehicle.
(7) "Group policy" means an insurance policy issued pursuant to section three thousand four hundred fifty-five of this article.
(c) A transportation network company driver or transportation network company on the driver's behalf through a group policy, shall maintain primary automobile insurance that:
(1) recognizes that the driver is a transportation network company driver or otherwise uses a vehicle to transport passengers for compensation and covers the driver:
(A) while the driver is logged on to the transportation network company's digital network; or
(B) while the driver is engaged in a prearranged ride.
(2) the following automobile insurance requirements shall apply while a participating transportation network company driver is logged on to the transportation network company's digital network and is available to receive transportation requests but is not engaged in a prearranged ride:
(A) primary automobile liability insurance in the amount of at least fifty thousand dollars for death and bodily injury per person, one hundred thousand dollars for death and bodily injury per incident, and twenty-five thousand dollars for property damage and coverage in satisfaction of the financial responsibility requirements set forth in section three thousand four hundred twenty of this article, article fifty-one of this chapter and regulations promulgated thereunder.
(B) the coverage requirements of this paragraph may be satisfied by any of the following:
(i) automobile insurance maintained by the transportation network company driver; or
(ii) automobile insurance provided through a group policy maintained by the transportation network company; or
(iii) any combination of clause (i) or (ii) of this subparagraph.
(3) the following automobile insurance requirements shall apply while a transportation network company driver is engaged in a prearranged ride:
(A) primary automobile liability insurance that provides at least one million dollars for death, bodily injury and property damage and coverage in satisfaction of the financial responsibility requirements set forth in section three thousand four hundred twenty of this article, article fifty-one of this chapter and regulations promulgated thereunder.
(B) the coverage requirements of this paragraph may be satisfied by any of the following:
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(i) automobile insurance maintained by the transportation network company driver; or
(ii) automobile insurance provided through a group policy maintained by the transportation network company; or
(iii) any combination of clauses (i) and (ii) of this subparagraph.
(4) a transportation network company shall, upon entering into a contractual agreement with a transportation network company driver, provide notice to the transportation network company driver that the driver may need additional insurance coverage including motor vehicle physical damage coverage as described in paragraph nineteen of subsection (a) of section one thousand one hundred thirteen of this chapter if the driver's personal vehicle is subject to a lease or loan. A transportation network company shall also post this notice on its website in a prominent place.
(5) if insurance maintained by a driver in paragraph two or three of this subsection has lapsed or does not provide the required coverage, insurance maintained by a transportation network company shall provide the coverage required by this subsection beginning with the first dollar of a claim and have the duty to defend such claim.
(6) coverage under an automobile insurance policy maintained by the transportation network company shall not be dependent on a personal automobile insurer first denying a claim nor shall a personal automobile insurance policy be required to first deny a claim.
(7) insurance required by this subsection may be placed with an insurer authorized or eligible to write insurance in this state and shall be eligible for placement by an excess line broker licensed pursuant to article twenty-one of this chapter.
(8) insurance satisfying the requirements of this subsection shall be deemed to satisfy the financial responsibility requirements set forth in subdivision four of section three hundred eleven of the vehicle and traffic law, section three thousand four hundred twenty of this article, article fifty-one of this chapter, and regulations promulgated thereunder, and such other requirements that may apply for the purposes of satisfying the financial responsibility requirements with respect to the use or operation of a motor vehicle.
(9) a transportation network company driver shall carry proof of coverage satisfying paragraphs two and three of this subsection with him or her at all times during his or her use of a vehicle in connection with a transportation network company's digital network. In the event of an accident, a transportation network company driver shall provide this insurance coverage information to the directly interested parties, automobile insurers and investigating police officers, upon request. Upon such request, a transportation network company driver shall also disclose to directly interested parties, automobile insurers, and investigating police officers, whether he or she was logged on to the transportation network company's digital network or on a prearranged ride at the time of an accident.
(d) The transportation network company shall disclose in writing to transportation network company drivers the following before they are allowed to accept a request for a prearranged ride on the transportation network company's digital network:
(1) the insurance coverage, including the types of coverage and the limits for each coverage, that the transportation network company provides while the transportation network company driver uses a personal vehicle in connection with a transportation network company's digital network; and
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(2) that the transportation network company driver's own automobile insurance policy might not provide any coverage while the driver is logged on to the transportation network company's digital network and is available to receive transportation requests or is engaged in a prearranged ride, depending on its terms.
(e) (1) Insurers that write automobile insurance in this state may exclude any and all coverage afforded under the policy issued to an owner or operator of a personal vehicle for any loss or injury that occurs while a driver is logged on to a transportation network company's digital network or while a driver provides a prearranged ride. This right to exclude all coverage may apply to any coverage included in an automobile insurance policy including, but not limited to:
(A) liability coverage for bodily injury and property damage;
(B) coverage provided pursuant to article fifty-one of this chapter;
(C) uninsured and underinsured motorist coverage; and
(D) motor vehicle physical damage coverage as described in paragraph nineteen of subsection (a) of section one thousand one hundred thirteen of this chapter.
(2) Such exclusions shall apply notwithstanding any requirement under the law to the contrary. Nothing in this section implies or requires that a personal automobile insurance policy provide coverage while the driver is logged on to the transportation network company's digital network, while the driver is engaged in a prearranged ride or while the driver otherwise uses a vehicle to transport passengers for compensation.
(3) Nothing shall be deemed to preclude an insurer from providing coverage for the transportation network company driver's vehicle, if it so chose to do so by contract or endorsement.
(4) Automobile insurers that exclude the coverage described in subsection (c) of this section shall have no duty to defend or indemnify any claim expressly excluded thereunder. Nothing in this article shall be deemed to invalidate or limit an exclusion contained in a policy including any policy in use or approved for use in this state prior to the enactment of this section that excludes coverage for vehicles used to carry persons or property for a charge or available for hire by the public.
(5) An automobile insurer that defends or indemnifies a claim against a driver that is excluded under the terms of its policy, shall have a right of contribution against other insurers that provide automobile insurance to the same driver in satisfaction of the coverage requirements of subsection (c) of this section at the time of loss.
(6) In a claims coverage investigation, transportation network companies and any insurer potentially providing coverage under subsection (c) of this section shall, within fifteen days after a claim has been filed, facilitate the exchange of relevant information with directly involved parties and any insurer of the transportation network company driver if applicable, including the precise times that a transportation network company driver logged on and off of the transportation network company's digital network in the twelve hour period immediately preceding and in the twelve hour period immediately following the accident and disclose to one another a clear description of the coverage, exclusions and limits provided under any automobile insurance maintained under subsection (c) of this section.
§ 2. The insurance law is amended by adding a new section 3455 to read as follows:
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§ 3455. Transportation network company group insurance policies. (a) For purposes of this section, the following definitions shall apply:
(1) "Transportation network company" shall have the meaning set forth in subsection (b) of section three thousand four hundred forty-one of this article.
(2) "Certificate" or "certificate of insurance" means any policy, contract or other evidence of insurance, or rider or endorsement thereto, issued to a group member under a transportation network company group policy.
(3) "Transportation network company group policy" or "group policy" means group policy, including certificate issued to the group members, where the group policyholder is a transportation network company and the policy provides insurance to the transportation network company and to group members:
(A) in accordance with the requirements of subsection (c) of section three thousand four hundred forty-one of this article;
(B) of the type described in paragraphs thirteen, fourteen and/or nineteen of subsection (a) of section one thousand one hundred thirteen of this chapter; and
(C) in satisfaction of the financial responsibility requirements set forth in section three thousand four hundred twenty of this article, subdivision four of section three hundred eleven of the vehicle and traffic law, article fifty-one of this chapter, and regulations promulgated thereunder.
(4) "Group Member" means a "transportation network company driver" as defined in subsection (b) of section three thousand four hundred fortyone of this article.
(5) "Group policyholder" means a transportation network company.
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