American Property Casualty Insurance Association
  • Staff Contact: Nicole Mahrt-Ganley     
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  • July 1, 2015
  • California and Nevada TNC Laws Take Effect

    New Laws Close Insurance Gaps for Drivers, Passengers and the Public

    SACRAMENTO, Calif. – Today consumer safety took a big step forward as two laws in California and Nevada officially take effect giving drivers working for transportation network companies (TNCs) the ability to purchase auto insurance policies specifically designed to cover the use of a personal car in a ridesharing program, like Uber and Lyft, reported the Association of California Insurance Companies (ACIC) and the Property Casualty Insurers Association of America (PCI).

    California’s law, AB 2293 by Assemblywoman Susan Bonilla (D-Concord), is designed to fix the insurance gaps that persist when TNCs drivers use their personal vehicles to provide passengers a ride arranged through a smartphone app for a fee.

    “AB 2293 protects drivers, passengers and the public,” said Armand Feliciano, ACIC vice president.  “Now drivers or TNCs can purchase a policy in California that covers the car from app on to app off.  AB 2293 contained a delayed implementation date in order to give the market time to develop products.  Insurers have responded and there are products available.  California’s law is unique from other TNC laws in that it requires TNCs to have $200,000 excess liability coverage during period one.”

    AB 2293:

    • Establishes a personal insurance firewall to ensure personal insurance auto policyholders will no longer subsidize the commercial activity of TNCs, beginning July 1, 2015.

    • Lowers the primary insurance coverage requirement in the timeframe formerly known as, “App On to Match,” to: $50,000/$100,000/$30,000 with excess coverage of $200,000.

    • Ensures the California Public Utilities Commission has oversight of Transportation Network Companies (TNC) such as Uber and Lyft. 

    • Expedites the approval process for new TNC insurance products. 

    • Had a delayed implementation date of July 1, 2015 in order for new products to be developed to meet the needs of the marketplace.                                                         

      “Nevada is among 24 states and the District of Columbia that have also approved ridesharing legislation recently,” said Mark Sektnan, PCI vice president.  “Nevada’s law, AB 176, also takes effect today on July 1, 2015 and requires specific TNC insurance from app on to app off.  Drivers should be aware that these policies do not have comprehensive or collision coverage for their car during period one.  Drivers should consider getting coverage for that.”

    • AB 176:

    • Defines transportation services as the period when a driver accepts a ride request until the passenger leaves the car and the app is turned off. 

    • Requires $1.5 million in coverage during this period when a passenger is in the car, the same level required for taxis. 

    • Drivers or TNCs will be required to have $50,000 for bodily injury or death of one person during the period when there is no passenger inside the vehicle and no less than $100,000 for bodily injury or death for two or more people in one accident. 

    • TNCs and drivers will be required to carry $25,000 for injury or destruction of property of others in one accident while the driver is logged into the digital network. This bill includes language contained in model legislation supported by insurers and TNCs.


    Regulations to implement Nevada’s law will be developed by the Nevada Transportation Authority. 

    Video on AB 2293

  • ACIC, the California voice of the Property Casualty Insurers Association of America, represents 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.
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