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By: Greg Barcomb

It’s here!  Finally!  Up-State New Yorkers, our prayers have been answered and we have access to ride sharing apps come June 29th!  Anyone who has ever been to places where apps like Uber and Lyft are currently available knows the convenience, ease of use, and reliability that comes with it.

The process of getting it to us Up-Staters was a political nightmare, and many of us have been frustratingly shaking our heads wondering why!!  The short answer- they had to figure out the insurance.  The NYS Personal Auto Policy (PAP) is not intended to cover drivers for a commercial use; and NYS law, among other things, made it illegal for TNC’s (transportation network companies) to purchase group insurance for their non-employee drivers.

In order to understand how Albany figured it out, and what it all means for potential drivers, we need to start in NYC.

As we all know ridesharing has been available in NYC already for some time….but how? NYC ridesharing is a completely different animal than how the applications work anywhere else.  In order to be allowed to be a driver in the city, the vehicle has to be registered as a FHV (For-Hire Vehicle) with the DMV and the driver needs to also get a NYC TLC license (Taxi & Limousine Commission) that requires a full background check and drug test.  This also requires the driver to provide a Commercial Auto Policy meeting the minimum required limits.  These policies can run anywhere from $4,000-$7,000 per vehicle.  But what about the personal injury protection for the driver if they are hurt?  The commercial auto is only for physical damage and liability.  Enter the Black Car Fund!  The fund was not only created to monitor the background checks on all drivers, but 2.5% of each fare is put into a Workers Compensation insurance pool.  So if a driver is injured while logged into the app, it would be handled through this self-insured fund.

Now this process is much more complex and costly than how the app is intended to work- but its NYC and the opportunities for fares are endless, so for a lot of people it is obviously worth it.  But this process couldn’t work throughout the state.  So how can we fix this?  The answer is ironically very simple.  Allow Uber to buy insurance for their drivers.  

So that’s basically what happened.  The NYS government amended the Insurance Law to allow TNC’s to provide group insurance and not requiring drivers to register as FHV.  Now the tricky part with all of this is when exactly you are are no longer considered a personal auto and become a TNC driver.  When you turn the app on?  When you accept a rate?  When a rider actually enters the vehicle?  All of that has supposedly been debated and ironed out into law….. But anyone who has studied any kind of law knows case law sets the tone, so we will see how these laws are interpreted as time goes on. 

So this is basically what you NEED TO KNOW right now if you plan on driving for Uber: 

1.       When you turn on the Uber application and sign in as a driver--YOU SHOULD NOT THINK YOU HAVE ANY COVERAGE UNDER YOUR PERSONAL AUTO POLICY.  You are covered under Uber’s group insurance with bodily injury limits of $50,000 per person, $100,000 per accident and $25,000 of property damage.  Now….in this professional’s opinion, these limits are way too low, but that is what our law makers agreed upon. 

2.       You also have Actual Cash Value (not full replacement cost) comprehensive and collision coverage through Uber after $1,000 deductible, but ONLY IF YOU HAVE THIS COVERAGE ON YOUR PERSONAL AUTO. 

3.       Once you accept a rate and take a rider in the car- the Uber limits shift up to $1 million in liability and the comprehensive and collision coverage maintains the same. 

The main questions I still have are: 

1.       They’ve addressed the liability issues, but what about Personal Injury Protection (aka No Fault coverage covering injuries to you and your passengers)?  Are Uber drivers in Up-State automatically members of the Black Card Fund and are the drivers’ injuries covered like a Workers Compensation case?  When I asked this question to Uber’s customer support unit, I was directed to a “Driver Injury Protection” page, which simply said “This product is not available yet in your State”…..

2.       How will driving for Uber affect my personal auto rates?  The insurance companies have been very quiet on the topic on making any kind of definitive answer in any way.  How will they rate for this?  Rides per year, total mileage?  All we do know though, is per the amendments to the NYS Insurance Law, it is illegal for an insurance carrier to cancel coverage solely because a driver is working as a TNC.   To be clear, at present we do not see personal auto carriers covering you when you act as a TNC driver.

3.       Will you be able to purchase riders or endorsements to increase you coverage about the insanely low limits Uber provides? And if so, in the case of an accident which coverage will be primary?

I have heard a lot of “this is legal in so many other states, why don’t you just see what they do?”  Which is a very fair thing to ask, but insurance is regulated on a state level, and our State’s insurance is far more complex than most. 

I am sure, in time, we will have all the answers to these questions. But what we do know is we are here, and we are very excited for this to come!  But I desperately urge you to control that excitement and take the time to think it through and understand the risk you are taking as a driver!  I am using all the resources I have to work to become a TNC Insurance Expert…. Or as close to it as I can.  So if you want to talk more specifically with a bunch of fancy insurance language and acronyms, my phone is always on!
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