STATE OF NEW YORK
________________________________________________________________________
4108--D
Cal. No. 1283
2015-2016 Regular Sessions
IN SENATE
February 27, 2015
___________
Introduced by Sens. SEWARD, BOYLE, VALESKY -- read twice and ordered
printed, and when printed to be committed to the Committee on Insur-
ance -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee -- committee discharged,
bill amended, ordered reprinted as amended and recommitted to said
committee -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee -- recommitted to the
Committee on Insurance in accordance with Senate Rule 6, sec. 8 --
reported favorably from said committee, ordered to first and second
report, ordered to a third reading, amended and ordered reprinted,
retaining its place in the order of third reading
AN ACT to amend the insurance law, in relation to transportation network
companies
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The insurance law is amended by adding a new section 3441
2 to read as follows:
3 § 3441. Transportation network companies. (a) Notwithstanding any
4 other provision of this chapter, this section shall apply to transporta-
5 tion network companies.
6 (b) For purposes of this section the following definitions shall
7 apply:
8 (1) "Personal vehicle" means a motor vehicle used by a transportation
9 network company driver and is owned or leased by the transportation
10 network company driver.
11 (2) "Digital network" means any online-enabled application, software,
12 website or system offered or utilized by a transportation network compa-
13 ny that enables the prearrangement of rides with transportation network
14 company drivers.
15 (3) "Transportation network company" means a corporation, partnership,
16 sole proprietorship, or other entity that is operating in this state
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD09417-11-6
S. 4108--D 2
1 that uses a digital network to connect transportation network company
2 riders to transportation network company drivers who provide prearranged
3 rides.
4 (4) "Transportation network company driver" or "driver" means an indi-
5 vidual who:
6 (A) receives connections to potential riders and related services from
7 a transportation network company in exchange for payment of a fee to the
8 transportation network company; and
9 (B) uses a personal vehicle to offer or provide a prearranged ride to
10 riders upon connection through a digital network controlled by a trans-
11 portation network company in return for compensation or payment of a
12 fee.
13 (5) "Transportation network company rider" or "rider" means an indi-
14 vidual or persons who use a transportation network company's digital
15 network to connect with a transportation network driver who provides
16 prearranged rides to the rider in the driver's personal vehicle between
17 points chosen by the rider.
18 (6) "Prearranged ride" means the provision of transportation by a
19 driver to a rider, beginning when a driver accepts a ride requested by a
20 rider through a digital network controlled by a transportation network
21 company, continuing while the driver transports a requesting rider, and
22 ending when the last requesting rider departs from the personal vehicle.
23 (7) "Group policy" means an insurance policy issued pursuant to
24 section three thousand four hundred fifty-five of this article.
25 (c) A transportation network company driver or transportation network
26 company on the driver's behalf through a group policy, shall maintain
27 primary automobile insurance that:
28 (1) recognizes that the driver is a transportation network company
29 driver or otherwise uses a vehicle to transport passengers for compen-
30 sation and covers the driver:
31 (A) while the driver is logged on to the transportation network compa-
32 ny's digital network; or
33 (B) while the driver is engaged in a prearranged ride.
34 (2) the following automobile insurance requirements shall apply while
35 a participating transportation network company driver is logged on to
36 the transportation network company's digital network and is available to
37 receive transportation requests but is not engaged in a prearranged
38 ride:
39 (A) primary automobile liability insurance in the amount of at least
40 fifty thousand dollars for death and bodily injury per person, one
41 hundred thousand dollars for death and bodily injury per incident, and
42 twenty-five thousand dollars for property damage and coverage in satis-
43 faction of the financial responsibility requirements set forth in
44 section three thousand four hundred twenty of this article, article
45 fifty-one of this chapter and regulations promulgated thereunder.
46 (B) the coverage requirements of this paragraph may be satisfied by
47 any of the following:
48 (i) automobile insurance maintained by the transportation network
49 company driver; or
50 (ii) automobile insurance provided through a group policy maintained
51 by the transportation network company; or
52 (iii) any combination of clause (i) or (ii) of this subparagraph.
53 (3) the following automobile insurance requirements shall apply while
54 a transportation network company driver is engaged in a prearranged
55 ride:
S. 4108--D 3
1 (A) primary automobile liability insurance that provides at least one
2 million dollars for death, bodily injury and property damage and cover-
3 age in satisfaction of the financial responsibility requirements set
4 forth in section three thousand four hundred twenty of this article,
5 article fifty-one of this chapter and regulations promulgated there-
6 under.
7 (B) the coverage requirements of this paragraph may be satisfied by
8 any of the following:
9 (i) automobile insurance maintained by the transportation network
10 company driver; or
11 (ii) automobile insurance provided through a group policy maintained
12 by the transportation network company; or
13 (iii) any combination of clauses (i) and (ii) of this subparagraph.
14 (4) a transportation network company shall, upon entering into a
15 contractual agreement with a transportation network company driver,
16 provide notice to the transportation network company driver that the
17 driver may need additional insurance coverage including motor vehicle
18 physical damage coverage as described in paragraph nineteen of
19 subsection (a) of section one thousand one hundred thirteen of this
20 chapter if the driver's personal vehicle is subject to a lease or loan.
21 A transportation network company shall also post this notice on its
22 website in a prominent place.
23 (5) if insurance maintained by a driver in paragraph two or three of
24 this subsection has lapsed or does not provide the required coverage,
25 insurance maintained by a transportation network company shall provide
26 the coverage required by this subsection beginning with the first dollar
27 of a claim and have the duty to defend such claim.
28 (6) coverage under an automobile insurance policy maintained by the
29 transportation network company shall not be dependent on a personal
30 automobile insurer first denying a claim nor shall a personal automobile
31 insurance policy be required to first deny a claim.
32 (7) insurance required by this subsection may be placed with an insur-
33 er authorized or eligible to write insurance in this state and shall be
34 eligible for placement by an excess line broker licensed pursuant to
35 article twenty-one of this chapter.
36 (8) insurance satisfying the requirements of this subsection shall be
37 deemed to satisfy the financial responsibility requirements set forth in
38 subdivision four of section three hundred eleven of the vehicle and
39 traffic law, section three thousand four hundred twenty of this article,
40 article fifty-one of this chapter, and regulations promulgated there-
41 under, and such other requirements that may apply for the purposes of
42 satisfying the financial responsibility requirements with respect to the
43 use or operation of a motor vehicle.
44 (9) a transportation network company driver shall carry proof of
45 coverage satisfying paragraphs two and three of this subsection with him
46 or her at all times during his or her use of a vehicle in connection
47 with a transportation network company's digital network. In the event of
48 an accident, a transportation network company driver shall provide this
49 insurance coverage information to the directly interested parties, auto-
50 mobile insurers and investigating police officers, upon request. Upon
51 such request, a transportation network company driver shall also
52 disclose to directly interested parties, automobile insurers, and inves-
53 tigating police officers, whether he or she was logged on to the trans-
54 portation network company's digital network or on a prearranged ride at
55 the time of an accident.
S. 4108--D 4
1 (d) The transportation network company shall disclose in writing to
2 transportation network company drivers the following before they are
3 allowed to accept a request for a prearranged ride on the transportation
4 network company's digital network:
5 (1) the insurance coverage, including the types of coverage and the
6 limits for each coverage, that the transportation network company
7 provides while the transportation network company driver uses a personal
8 vehicle in connection with a transportation network company's digital
9 network; and
10 (2) that the transportation network company driver's own automobile
11 insurance policy might not provide any coverage while the driver is
12 logged on to the transportation network company's digital network and is
13 available to receive transportation requests or is engaged in a prear-
14 ranged ride, depending on its terms.
15 (e) (1) Insurers that write automobile insurance in this state may
16 exclude any and all coverage afforded under the policy issued to an
17 owner or operator of a personal vehicle for any loss or injury that
18 occurs while a driver is logged on to a transportation network company's
19 digital network or while a driver provides a prearranged ride. This
20 right to exclude all coverage may apply to any coverage included in an
21 automobile insurance policy including, but not limited to:
22 (A) liability coverage for bodily injury and property damage;
23 (B) coverage provided pursuant to article fifty-one of this chapter;
24 (C) uninsured and underinsured motorist coverage; and
25 (D) motor vehicle physical damage coverage as described in paragraph
26 nineteen of subsection (a) of section one thousand one hundred thirteen
27 of this chapter.
28 (2) Such exclusions shall apply notwithstanding any requirement under
29 the law to the contrary. Nothing in this section implies or requires
30 that a personal automobile insurance policy provide coverage while the
31 driver is logged on to the transportation network company's digital
32 network, while the driver is engaged in a prearranged ride or while the
33 driver otherwise uses a vehicle to transport passengers for compen-
34 sation.
35 (3) Nothing shall be deemed to preclude an insurer from providing
36 coverage for the transportation network company driver's vehicle, if it
37 so chose to do so by contract or endorsement.
38 (4) Automobile insurers that exclude the coverage described in
39 subsection (c) of this section shall have no duty to defend or indemnify
40 any claim expressly excluded thereunder. Nothing in this article shall
41 be deemed to invalidate or limit an exclusion contained in a policy
42 including any policy in use or approved for use in this state prior to
43 the enactment of this section that excludes coverage for vehicles used
44 to carry persons or property for a charge or available for hire by the
45 public.
46 (5) An automobile insurer that defends or indemnifies a claim against
47 a driver that is excluded under the terms of its policy, shall have a
48 right of contribution against other insurers that provide automobile
49 insurance to the same driver in satisfaction of the coverage require-
50 ments of subsection (c) of this section at the time of loss.
51 (6) In a claims coverage investigation, transportation network compa-
52 nies and any insurer potentially providing coverage under subsection (c)
53 of this section shall, within fifteen days after a claim has been filed,
54 facilitate the exchange of relevant information with directly involved
55 parties and any insurer of the transportation network company driver if
56 applicable, including the precise times that a transportation network
S. 4108--D 5
1 company driver logged on and off of the transportation network company's
2 digital network in the twelve hour period immediately preceding and in
3 the twelve hour period immediately following the accident and disclose
4 to one another a clear description of the coverage, exclusions and
5 limits provided under any automobile insurance maintained under
6 subsection (c) of this section.
7 § 2. The insurance law is amended by adding a new section 3455 to read
8 as follows:
9 § 3455. Transportation network company group insurance policies. (a)
10 For purposes of this section, the following definitions shall apply:
11 (1) "Transportation network company" shall have the meaning set forth
12 in subsection (b) of section three thousand four hundred forty-one of
13 this article.
14 (2) "Certificate" or "certificate of insurance" means any policy,
15 contract or other evidence of insurance, or rider or endorsement there-
16 to, issued to a group member under a transportation network company
17 group policy.
18 (3) "Transportation network company group policy" or "group policy"
19 means group policy, including certificate issued to the group members,
20 where the group policyholder is a transportation network company and the
21 policy provides insurance to the transportation network company and to
22 group members:
23 (A) in accordance with the requirements of subsection (c) of section
24 three thousand four hundred forty-one of this article;
25 (B) of the type described in paragraphs thirteen, fourteen and/or
26 nineteen of subsection (a) of section one thousand one hundred thirteen
27 of this chapter; and
28 (C) in satisfaction of the financial responsibility requirements set
29 forth in section three thousand four hundred twenty of this article,
30 subdivision four of section three hundred eleven of the vehicle and
31 traffic law, article fifty-one of this chapter, and regulations promul-
32 gated thereunder.
33 (4) "Group Member" means a "transportation network company driver" as
34 defined in subsection (b) of section three thousand four hundred forty-
35 one of this article.
36 (5) "Group policyholder" means a transportation network company.
37 (6) "Personal vehicle" shall have the meaning set forth in subsection
38 (b) of section three thousand four hundred forty-one of this article.
39 (b) An insurer may issue or issue for delivery in this state a trans-
40 portation network company group policy to a transportation network
41 company as a group policyholder only in accordance with the provisions
42 of this section.
43 (c)(1) A transportation network company group policy shall provide
44 coverage for a personal vehicle in accordance with the requirements of
45 subsection (c) of section three thousand four hundred forty-one of this
46 article.
47 (2) A transportation network company group policy may provide:
48 (A) coverage for limits higher than the minimum limits required pursu-
49 ant to subsection (c) of section three thousand four hundred forty-one
50 of this article;
51 (B) supplementary uninsured/underinsured motorists insurance for bodi-
52 ly injury pursuant to paragraph two of subsection (f) of section three
53 thousand four hundred twenty of this article;
54 (C) supplemental spousal liability insurance pursuant to subsection
55 (g) of section three thousand four hundred twenty of this chapter; and
S. 4108--D 6
1 (D) motor vehicle physical damage coverage as described in paragraph
2 nineteen of subsection (a) of section one thousand one hundred thirteen
3 of this chapter.
4 (3) The coverage described in paragraphs one and two of this
5 subsection may be provided in one group policy or in separate group
6 policies.
7 (4) A transportation network company group policy, including certif-
8 icates, shall be issued by an insurer authorized or eligible to write
9 insurance in this state and shall be eligible for placement by an excess
10 line broker licensed pursuant to article twenty-one of this chapter.
11 (5) A policyholder also may be an insured under a group policy.
12 (d) The premium for the transportation network company group policy,
13 including certificates may be paid by the group policyholder from the
14 funds contributed:
15 (1) wholly by the group policyholder;
16 (2) wholly by the group members; or
17 (3) jointly by the group policyholder and the group members.
18 (e) (1) Any policy dividend, retrospective premium credit, or retro-
19 spective premium refund in respect of premiums paid by the group policy-
20 holder may:
21 (A) be applied to reduce the premium contribution of the group policy-
22 holder, but not in excess of the proportion to its contribution; or
23 (B) be retained by the group policyholder.
24 (2) Any policy dividend, retrospective premium credit, or retrospec-
25 tive premium refund not distributed under paragraph one of this
26 subsection shall be:
27 (A) applied to reduce future premiums and, accordingly, future
28 contributions, of existing or future group members, or both; or
29 (B) paid or refunded to those group members insured on the date the
30 payment or refund is made to the group policyholder, if distributed by
31 the group policyholder, or on the date of mailing, if distributed
32 directly by the insurer, subject to the following requirements:
33 (i) The insurer shall be responsible for determining the allocation of
34 the payment of refund to the group members;
35 (ii) If the group policyholder distributes the payment or refund, the
36 insurer shall be responsible for audit to ascertain that the payment or
37 refund is actually made in accordance with the allocation procedure; and
38 (iii) If the group policyholder fails to make the payment or refund,
39 the insurer shall make the payment or refund directly or use the method
40 provided in subparagraph (A) of this paragraph.
41 (3) Notwithstanding paragraphs one and two of this subsection, if a
42 dividend accrues upon termination of coverage under a transportation
43 network company group policy, the premium for which was paid out of
44 funds contributed by group members specifically for the coverage, the
45 dividend shall be paid or refunded by the group policyholder to the
46 group members insured on the date the payment or refund is made to the
47 group policyholder, net of reasonable expenses incurred by the group
48 policyholder in paying or refunding the dividend to such group members.
49 (4) For the purposes of this subsection, "dividend" means a return by
50 the insurer of a transportation network company group policy of excess
51 premiums to the group policyholder in light of favorable loss experi-
52 ence, including retrospective premium credits or retrospective premium
53 refunds. The term "dividend" does not include reimbursements or fees
54 received by a group policyholder in connection with the operation or
55 administration of a transportation network company group policy, includ-
S. 4108--D 7
1 ing administrative reimbursements, fees for services provided by the
2 group policyholder, or transactional service fees.
3 (f) The insurer must treat in like manner all eligible group members
4 of the same class and status.
5 (g) Each policy written pursuant to this section shall provide per
6 occurrence limits of coverage for each group member in an amount not
7 less than that required by of subsection (c) of section three thousand
8 four hundred forty-one of this article, and may provide coverage for
9 limits higher than the minimum limits required under the law.
10 (h) (1) The insurer or the group policyholder shall be responsible for
11 mailing or delivery of a certificate of insurance to each group member
12 insured under the transportation network company group policy. The
13 insurer or the group policyholder shall also be responsible for the
14 mailing or delivery to each group member of an amended certificate of
15 insurance or endorsement to the certificate, whenever there is a change
16 in limits; change in type of coverage; addition, reduction, or elimi-
17 nation of coverage; or addition of exclusion, under the transportation
18 network company group policy or certificate.
19 (2) The certificate shall contain in substance all material terms and
20 conditions of coverage afforded to group members, unless the transporta-
21 tion network company group policy is incorporated by reference and a
22 copy of the group policy accompanies the certificate.
23 (3) If any coverage afforded to the group member is excess of applica-
24 ble insurance coverage, the certificate shall contain a notice advising
25 the group members that, if the member has other insurance coverage,
26 specified coverages under the transportation network company group poli-
27 cy will be excess over the other insurance.
28 (i) A group policyholder shall comply with the provisions of section
29 two thousand one hundred twenty-two of this chapter, in the same manner
30 as an agent or broker, in any advertisement, sign, pamphlet, circular,
31 card, or other public announcement referring to coverage under a trans-
32 portation network company group policy or certificate.
33 (j) A transportation network company group policy shall not be subject
34 to section three thousand four hundred twenty-five or section three
35 thousand four hundred twenty-six of this article; provided that the
36 following requirements shall apply with regard to termination of cover-
37 age:
38 (1)(A) An insurer may terminate a group policy or certificate only if
39 cancellation is based on one or more of the reasons set forth in subpar-
40 agraph (A) through (D) or (F) through (H) of paragraph one of subsection
41 (c) of section three thousand four hundred twenty-six of this article;
42 provided, however, that an act or omission by a group member that would
43 constitute the basis for cancellation of an individual certificate shall
44 not constitute the basis for cancellation of the group policy.
45 (B) Where the premium is derived wholly from funds contributed by the
46 group policyholder, an insurer may cancel an individual certificate only
47 if cancellation is based on one or more of the reasons set forth in
48 subparagraph (B), (C) or (H) of paragraph one of subsection (c) of
49 section three thousand four hundred twenty-six of this article.
50 (2) (A) An insurer's cancellation of a group policy, including all
51 certificates, shall not become affective until thirty days after the
52 insurer mails or delivers written notice of cancellation to the group
53 policyholder at the mailing address shown in the policy.
54 (i) Where all or part of the premium is derived from funds contributed
55 by the group member specifically for the coverage, the insurer shall
S. 4108--D 8
1 also mail or deliver written notice of cancellation of the group policy
2 to the group member at the group member's mailing address.
3 (ii) Where none of the premium is derived from funds contributed by a
4 group member specifically for the coverage, the group policy holder
5 shall mail or deliver written notice to the group member advising the
6 group member of the cancellation of the group policy and the effective
7 date of cancellation. The group policy holder shall mail or deliver the
8 written notice within ninety days after receiving notice of cancellation
9 from the insurer.
10 (B) An insurer's cancellation of an individual certificate shall not
11 become effective until thirty days after the insurer mails or delivers
12 written notice of cancellation to the group member at the group member's
13 mailing address and to the group policyholder at the mailing address
14 shown in the group policy.
15 (3) (A) A group policyholder may cancel a group policy, including all
16 certificates, or any individual certificate, for a reason upon thirty
17 days written notice to the insurer and each group member; and
18 (B) The group policyholder shall mail or deliver written notice to
19 each affected group member of the group policyholder's cancellation of
20 the group policy or certificate and the effective date of cancellation.
21 The group policyholder shall mail or deliver the written notice to the
22 group member's mailing address at least thirty days prior to the effec-
23 tive date of cancellation.
24 (4) (A) Unless a group policy provides for a longer policy period, the
25 policy and all certificates shall be issued or renewed for a one-year
26 policy period.
27 (B) The group policyholder shall be entitled to renew the group policy
28 and all certificates upon timely payment of the premium billed to the
29 group policyholder for the renewal, unless:
30 (i) the insurer mails or delivers to the group policyholder and all
31 group members written notice of nonrenewal, or conditional renewal; and
32 (ii) the insurer mails or delivers the written notice at least thirty,
33 but not more than one hundred twenty days prior to the expiration date
34 specified in the policy or, if no date is specified, the next anniver-
35 sary date of the policy.
36 (5) Where the group policyholder nonrenews the group policy, the group
37 policyholder shall mail or deliver written notice to each group member
38 advising the group member of nonrenewal of the group policy and the
39 effective date of nonrenewal. The group policyholder shall mail or
40 deliver written notice at least thirty days prior to the nonrenewal.
41 (6) Every notice of cancellation, nonrenewal, or conditional renewal
42 shall set forth the specific reason or reasons for cancellation, nonre-
43 newal, or conditional renewal.
44 (7) (A) An insurer shall not be required under this subsection to give
45 notice to a group member if the insurer has been advised by either the
46 group policyholder or another insurer that substantially similar cover-
47 age has been obtained from the other insurer without lapse of coverage.
48 (B) A group policyholder shall not be required under this subsection
49 to give notice to a group member if substantially similar coverage has
50 been obtained from another insurer without lapse of coverage.
51 (8) (A) If, prior to the effective date of cancellation, nonrenewal,
52 or conditional renewal of the group policy, or a certificate, whether
53 initiated by the insurer, group policyholder or by the group member in
54 regard to the group member's certificate, coverage attaches pursuant to
55 the terms of a group policy, then the coverage shall be effective until
56 expiration of the applicable period of coverage provided in the group
S. 4108--D 9
1 policy notwithstanding the cancellation, nonrenewal or conditional
2 nonrenewal of the group policy.
3 (B) Notwithstanding subparagraph (A) of this paragraph, an insurer may
4 terminate coverage under an individual certificate on the effective date
5 of cancellation, if the certificate is cancelled in accordance with the
6 provisions of subparagraph (B) of paragraph one of this subsection.
7 (k) Any mailing or delivery to a group member required or permitted
8 under this section may be made by electronic mail if consent to such
9 method of delivery has been previously received from such group member.
10 (l) The superintendent shall not approve for delivery any policy under
11 this section for a vehicle which is licensed to operate by a taxi and
12 limousine commission, in any city with a population of one million or
13 more.
14 § 3. Subsection (b) of section 5103 of the insurance law is amended by
15 adding a new paragraph 4 to read as follows:
16 (4) Is injured while operating a personal vehicle as a transportation
17 network company driver or transportation network company rider as such
18 terms are defined in subsection (b) of section three thousand four
19 hundred forty-one of this chapter.
20 § 4. The municipal officers and boards in cities, towns, villages and
21 counties of this state may adopt ordinances regulating transportation
22 network companies including but not limited to comprehensive background
23 checks of prospective drivers and on all other matters other than the
24 insurance requirements set forth in section 3441 of the insurance law.
25 Nothing in this section shall authorize any transportation network
26 company or transportation network driver to provide passenger pick-up
27 service in a city with a population of one million or more except as may
28 be authorized by such city.
29 § 5. This act shall take effect immediately.
