Ridesharing Regulations Released: How to Advise Your Customers
On Monday this week, Gov. Andrew Cuomo signed legislation to move up the implementation date for ridesharing in New York from July 9th to June 29th, just in time for the Fourth of July weekend. A day later, the Governor introduced regulations from the Department of Financial Services (DFS) and the Department of Motor Vehicles (DMV) designed to set the rules for transportation network companies (TNCs) operating in New York. The regulation was issued on an emergency basis due to the upcoming implementation date.
The emergency regulation amends current regulations 41 (Excess Lines Placements), 35-A (Minimum Provisions for Auto Liability Insurance Policies), 35-D (Supplemental Uninsured/Underinsured Motorists Coverage), 68-A (No Fault), 68-C (Personal Injury Protection), 68-D (Arbitration), 100 (Merit Rating Plans), and 64 (Unfair Claims Settlement Practices) to provide the rules for TNCs operating in New York State. In addition, a new Regulation 35-E was created to provide minimum provisions for auto liability policies and other requirements for TNCs as outlined in legislation passed earlier this year.
The emergency regulation preserves the “livery” exclusion for personal auto policies and places requirements on TNCs to provide auto liability coverage for TNC drivers that are logged in to the digital network (75/150/25 limit) and when they have a passenger in the vehicle (1.25 million limit).
So, how do you advise your customers? The regulations to implement ridesharing were just introduced two days ago, and now the carriers can file coverage forms with the DFS. I am not aware of any approved filings at this point. Even ISO withdrew its filing in New York a couple of years ago until ridesharing was approved. We have some limited information on our website that we will update as we learn of any company filings. The most important thing for you to do right now is to stress to your customers that the personal auto policy may exclude coverage for this type of activity unless the policy is endorsed (and presently there are no endorsements available that I am aware of). The coverage that the transportation network company is required to provide to drivers is liability only and is only available when the driver is logged in, waiting for an assignment (75/150 /25 limit), and with a passenger in the car (1.25 million). There are no requirements to provide physical damage coverage. This is especially of concern if the vehicle is the subject of a lease or loan.
[Editor’s note – The DFS has mandated by regulation that the Period 1 coverage provided by the TNC-75/150/25 is primary until 1/1/19. This will allow insurers time to file and get approval for exclusion and/or coverage endorsements.]
Although the Governor was interested in making ridesharing available as quickly as possible, the practical matter is that there has not been enough time to develop appropriate coverage options for the June 29th launch.
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