Uber asked the New York City Taxi & Limousine Commission (TLC) in December to reconsider proposed changes to commercial auto insurance requirements, saying they may unintentionally leave thousands of drivers unable to insure their vehicles. As part of these changes, the regulator would add language requiring all TLC-licensed vehicles – including yellow cabs and app-hail cars – to be covered by an insurance policy issued by a “solvent and responsible company authorized to do business” in New York. It would also require minimum coverage from a single primary policy, prohibiting supplementary insurance from non-state licensed firms.
New York City officials are weighing tighter insurance rules after Bloomberg reported that the American Transit Insurance Co., which covers 60% of the city’s roughly 120,000 for-hire vehicles, is insolvent and posted more than $700 million in net losses in the second quarter. ATIC, which is still permitted to operate in New York State, built a customer base over several decades by offering premiums well below the market rate. Some drivers fear they won’t be able to afford a pricier alternative if they can no longer choose ATIC under the TLC’s revised rules, according to Insurance Journal.
Uber argues the TLC has not clearly defined the terms “solvent” and “responsible” and asks for leniency on the adoption deadline. It also asked to allow existing policies to remain valid until they expire. In addition, Uber is urging the TLC to consider lowering personal injury protection limits to control insurance costs, in line with legislation the City Council proposed in September.
Dan Bratshpis, chief executive officer of Inshur, a digital insurance provider, wrote in a prepared statement that the change to bar supplementary insurance threatens to kick its product out of the market. Inshur, which says it insures more than 7% of TLC vehicles with the backing of licensed Accident Fund Insurance Co., is not regulated by the state but is allowed to operate legally in the market.
Source: Insurance Journal
