American Property Casualty Insurance Association
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Jeffrey Brewer







April 11, 2014

Illinois House Passes Ride Sharing Legislation that Clarifies Insurance Coverage; Helps Protect Consumers

CHICAGO – The Illinois House passed legislation yesterday that takes a positive step forward in requiring that ride share firms are properly insured and the public is protected, according the Property Casualty Insurers Association of America (PCI).

On a strong bi-partisan vote of 80-26, the Illinois House approved HB 4075 which would establish regulations on ride sharing companies that are like those that apply to similar commercial driving enterprises. In addition to requiring ride share companies to do background checks on drivers, ensure vehicles are inspected and require chauffeur licenses for drivers who work more than 18 hours a week, the bill clarifies an important insurance coverage question by establishing that ridesharing firms’ commercial insurance coverage is primary.

“This legislation sets a reasonable standard to ensure that ride sharing activities are properly insured and that drivers, passengers and the public are protected if there is an accident,” said Jeffrey Junkas, regional manager for PCI. “The Illinois House struck a strike a balance between innovation and consumer protections. To that end, this bill contains key elements that help close the insurance coverage gap currently looming in this growing market and provides a uniform statewide solution. This legislation makes it clear that ride sharing is a commercial activity, which is important because the driver’s personal auto policy will not cover damage or losses arising when the car is used in a ride-sharing program. This provision will help to ensure that commercial insurance exposure is not inappropriately shifted to personal auto insurance, as that could force premiums for all drivers to increase.”

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.