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

Kara Cross, PIFC


916-440-1116 or Cell 916-616-5855






June 17, 2014

AB 2293 Protects Drivers, Passengers, Pedestrians and the Public

Measure Fixes TNC’s Insurance Gaps and Prevents California Drivers from Subsidizing TNC’s Business Expenses

SACRAMENTO, Calif. – Today, the California Senate Energy, Utilities and Communications Committee will hear AB 2293, a bill that will fix the insurance gaps that persist when transportation network companies’ (TNCs) drivers use their personal vehicles to provide passengers a ride arranged through a smartphone app for a fee. AB 2293 (Bonilla, D-Concord) closes the gaps in insurance coverage and requires TNCs to give drivers important disclosures.

“Innovation should NOT compromise the safety of the public,” said Armand Feliciano, ACIC vice president. “As the Sacramento Bee editorialized recently ‘in the sharing economy, you punch the clock by turning on the app.’ TNC service and commercial activity begins once the TNC driver turns on the “app” which indicates that driver is ‘open and available’ for TNC services. Insurers strongly support innovation and constantly develop new products to meet ever-changing market demands. AB 2293 is carefully crafted legislation that allows for flexibility to develop new products and will clarify the insurance laws related to TNC activities without stifling business innovation.”

Five property casualty insurance trade associations, representing nearly 100 percent of the California market offering both commercial and personal auto insurance, are supporting AB 2293. The trade associations include the American Insurance Association, the Association of California Insurance Companies, the National Association of Mutual Insurance Companies, the Pacific Association of Domestic Insurance Companies and the Personal Insurance Federation of California. These five trades want the public to fully understand that the personal auto insurance policy does not cover the riskier and more costly commercial driving of TNC drivers.

“The public and passengers need to know TNC services have the appropriate insurance coverage in place and TNC drivers need to fully understand that their personal insurance policy will not provide coverage when they drive for a TNC,” said Kara Cross, PIFC general counsel. “AB 2293 requires TNCs to make key disclosures to their drivers and requires TNCs to carry insurance app on to app off. This bill also protects other California drivers from subsidizing the business expenses of TNCs. The TNCs proposed amendments shifts the TNCs’ cost of doing business onto consumers and their personal auto insurance. Should all California drivers be at risk of higher auto insurance premiums so they can subsidize TNCs?  That is not fair.”

AB 2293 AB 2293 will do four things:

1)    Require TNCs to disclose to drivers upfront that their personal insurance may not apply when engaging in commercial TNC activities. 


2)    Define in statute that TNC activities begins once the “app” is turned on and the TNC services end when the “app” is turned off. 


3)    AB 2293 clarifies that TNC insurance is primary coverage.


4)    Require TNC’s liability insurance to defend and indemnify their drivers when they have a claim or accident.

AB 2293 will next be heard by the Senate Energy, Utilities and Communications Committee on Tuesday, June 17, 2014 at 9:30 a.m. in Room 3191 of the State Capitol and again in Senate Insurance on Wednesday, June 25, 2014. AB 2293 was approved by the California State Assembly on a vote of 71 to 0.

The Association of California Insurance Companies (ACIC) is part of the Property Casualty Insurers Association of America (PCI). ACIC is PCI’s California Voice representing 363 property casualty insurance companies doing business in California. These members write $20.2 billion in premium in California insuring 36 percent of the property casualty insurance sold in the state. California members write 44 percent of personal auto insurance, 29 percent of homeowners insurance, 33 percent of commercial lines business insurance and 40 percent of private workers compensation insurance sold in California.