Your plane just landed in Newark and you open your ridesharing app to arrange for a ride. A few minutes later, the driver texts you that he has arrived. You have his photo, license plate number, and description of the car and you spot him as soon as you step outside. All is well. You get into the car and suddenly a van rear-ends the ridesharing car. You’re injured. Now what? Who will pay your medical bills?
New Jersey legislators recently addressed that question. Under the newly enacted Transportation Network Company Safety and Regulatory Act, drivers and the ridesharing companies that employ them must meet certain insurance coverage standards.
The new law provides for $1.5 million in coverage under certain conditions as explained below.
If the driver is not logged into the ridesharing app, his personal automobile insurance policy coverage applies when he is driving.
If the driver is logged in and available to receive a ride request, but not is en route to pick up a customer, the driver, ridesharing company, or a combination of the two shall maintain the following insurance coverage: (1) primary automobile liability insurance in the amount of at least $50,000 for death or bodily injury per person, $100,000 for death or bodily injury per incident, and $25,000 for property damage; (2) primary personal injury protection benefits; coverage ranges from $15,000 per person per accident, not to exceed $250,000, depending on the coverage level in the type of policy chosen by the driver and the ridesharing company; and (3) uninsured and underinsured motorist coverage up to the amounts selected for primary liability insurance coverage.
If the driver is logged in and is en route to pick up a prearranged ride – or is providing a prearranged ride to a passenger – the driver, ridesharing company, or combination of the two shall maintain the following insurance coverage: (1) primary automobile liability insurance in the amount of at least $1,500,000 for death, bodily injury, and property damage; (2) primary automobile insurance for medical payments benefits in an amount of at least $10,000 per person per incident, which shall only apply to and provide coverage for the benefit of the transportation network company driver; and (3) uninsured and underinsured motorist coverage in an amount of at least $1,500,000.
Therefore, as a passenger injured in an accident involving a rideshare automobile, you would have medical coverage through the driver, the company, or both, for up to $1.5 million in medical bills.
Importantly, the law provides that the ridesharing company’s liability would be triggered if the driver is underinsured or uninsured, his insurance has lapsed, or he is denied coverage by his personal automobile insurance provider. Many insurance policies have exclusions that bar coverage for “ride-for-hire.” In the event the driver has no coverage, the rideshare company’s policy would provide coverage beginning with the first dollar of the claim, up to the $1.5 million limit.
It is also important to note that the law provides that coverage under an automobile insurance policy maintained by the ridesharing company shall not be dependent upon a private passenger automobile insurer first denying a claim nor shall a private passenger automobile insurance policy be required to first deny a claim.
The new law codifies the insurance coverage that Uber maintained before the legislation passed — $1.5 million on all trips. The law also eliminates much of the confusion surrounding responsibility for an injured passenger’s medical bills so that claims are not bounced back and forth between the rider’s insurance company, the driver’s insurance company, and the ridesharing company’s insurance company.