American Property Casualty Insurance Association
  • Staff Contact: Nicole Mahrt-Ganley     
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Nicole Mahrt Ganley


916-440-1116 or cell 916-616-5855






February 5, 2014

PCI Tells Colorado Legislators: Personal Auto Insurance Will Not Cover Drivers or Passengers in Ride-Sharing Programs

DENVER, CO – As members of the Colorado Senate Business, Labor and Technology Committee consider legislation sponsored by transportation network companies (TNCs), the Property Casualty Insurers Association of America (PCI) reminds senators that personal auto insurance policies will not provide coverage if a car is used in a ride-sharing program. 

Ride-sharing is a new transportation trend in major cities around the country where a company uses a smartphone app to connect drivers with people needing a ride for a fee as part of an organized program. Senate Bill 125 would allow TNCs to operate in Colorado with limited regulation by the Colorado Public Utilities Commission.

“Insurers support innovative ideas, however the drivers and passengers that ride in these cars must know where they stand regarding insurance coverage, said Kelly Campbell, PCI vice president. “Personal auto insurance policies are not intended for commercial activities and contain a specific “livery” exclusion which bars coverage if the car is used to transport passengers for a fee. These exclusions have been upheld in the courts for decades. To remove any ambiguity, legislation on this matter should include clear disclosure requirements by the TNC to the drivers that their personal auto policy will not cover property damage or under that policy require the driver’s insurer to defend them in any litigation. TNCs should not cost shift, insurance is part of the normal cost of doing business.”

Legislation on this issue has been introduced in Arizona.  Local ordinances governing TNCs have been introduced in both Seattle and Chicago.

“Colorado legislators should also question how drivers and passengers will be covered if the car is hit by an uninsured or underinsured driver, given that the personal auto policy will not provide coverage,” said Campbell. “The sponsors of SB 125 want to require a limited commercial liability policy but that policy will only be triggered when a TNC driver accepts a ride and coverage ends when the passenger exits the car. That narrow definition of when a commercial policy is triggered will leave periods of time when the driver will have no coverage for his car. Policymakers need to take a close look at this issue and make sure that drivers and passengers understand what coverage they have and when they have it.”

PCI is composed of more than 1,000 member companies, representing the broadest cross-section of insurers of any national trade association. PCI members write over $195 billion in annual premium, 39 percent of the nation’s property casualty insurance. Member companies write 46 percent of the U.S. automobile insurance market, 32 percent of the homeowners market, 37 percent of the commercial property and liability market, and 41 percent of the private workers compensation market.