Uber Lyft Insurance

A Transportation Network Company (TNC) or rideshare company is a person, corporation, partnership, sole proprietorship, or other entity licensed by the DMV to use a digital network (usually a smartphone application) to connect passengers to TNC drivers for prearranged trips.

Perhaps the most common TNCs outside of New York City are Uber and Lyft. A prearranged trip begins when a driver accepts a passenger's request for a trip through a TNC digital network, continues while the driver transports the requesting passenger in a TNC vehicle, and ends when the last requesting passenger departs from the vehicle.

On June 29 2017, New York added a new section to its vehicle and traffic law and amended other laws relating to the regulation of ride-hailing companies. More specifically, Part AAA of Chapter 59 of the Laws of 2017 added vehicle and traffic law Article 44-B entitled "Transportation Network Company Services", tax law Article 29-B, which established a state assessment on TNCs, and made amendments to the Insurance Law to permit ridesharing.

The purpose of the act was to ensure the safety, reliability, and cost-effectiveness of TNC services within the state of New York and to preserve and enhance access to these important transportation options for residents and visitors to the state.

The act applies across New York State except within New York City, which already allowed ride sharing companies to operate under its existing Taxi & Limousine Commission requirements. The act, therefore, excludes livery vehicles, taxicabs, for-hire vehicles, limousines, black cars, and buses, which must comply with all other state and local laws and regulations.

According to Article 29-B of the Tax Law, the state assessment is four percent (4%) of the gross trip fare of every TNC prearranged trip that originates anywhere in New York State outside New York City.

Insurance Coverage

A TNC driver, or the TNC on the driver's behalf through a group ridesharing insurance policy, must maintain insurance coverage that recognizes the driver is a TNC driver and provides financial responsibility coverage in accordance with VTL Article 44-B while the driver is logged onto the TNC's digital network.

Typically, when a TNC driver is not logged into the digital network, the driver is covered by their own personal car insurance. Once a TNC driver has logged onto the digital network, group ridesharing insurance can be implicated.

If the TNC driver is logged into the digital network, but waiting for a trip request, the insurance coverage includes:

  • Liability for bodily injury up to $75,000 per injury, per accident, with a total of $150,000 per accident and up to $25,000
  • Uninsured motorist bodily injury coverage of up to $25,000 in injury liability per person ($50,000 per accident), and $50,000 per person for death ($100,000 per accident);
  • No-fault coverage of $50,000
If the TNC driver is on his or her way to pick up a rider or a rider is in the car, the insurance coverage includes:
  • $1,250,000 of liability coverage per accident
  • $1,250,000 of supplemental uninsured/underinsured motorist bodily injury coverage per accident
  • Contingent comprehensive and collision insurance
  • No-fault coverage of $50,000

Now that Uber and Lyft have been permitted throughout upstate New York, Plaintiffs' attorneys investigating and handling motor vehicle accident cases must be diligent in determining whether a TNC driver was involved in the subject motor vehicle accident or whether their client was in the process of a prearranged trip, so as to put any TNC driver and group ridesharing insurance on notice of a potential claim.

Often times, the TNC driver's personal insurance policy that was used to register his or her vehicle will exclude coverage when the driver is logged onto a TNC's digital network, so it is important to ascertain and review all implicated insurance policies in order to effectively represent the client.

If a motor vehicle accident involves a TNC, attorneys should consult Article 44-B of the vehicle and traffic law and the New York State department of insurance to fully understand the intricacies of the law.

Lesley Niebel

Lesley E. Niebel, focuses her practice on personal injury and has worked on a range of cases including automobile accidents since joining Faraci Lange's Rochester office in 2015.

If you or someone you love have been injured in an auto accident, contact us for a free legal consultation today.