No more “free ride” for Uber

“Ridesharing” has increasingly become a transportation option for people on the go. Unlike traditional taxis, this mode of transit allows people to use their own cars and their own time to pick people up. These drivers choose their own time to drive, and through the use of apps are able to pick up riders who select where they want to be picked up and where they want to go.

The rapid rise in popularity of ridesharing has made it difficult for regulators to keep up and ensure that the companies that provide for this service are keeping their riders safe and that they are being held accountable for the actions of the drivers they employ. Legislation was passed Thursday by a vote of 49-12, which will provide a statewide framework to clarify insurance coverage for transportation network companies (TNCs), such as Uber and Lyft.

The legislation requires commercial coverage in the three stages of the process. Phase 1 begins when the driver has logged onto the digital TNC network, but has yet to pick up a passenger. During this phase, they would need the following coverage:

  • Primary automobile liability insurance in the amount of at least $50,000 for death and bodily injury per person, $100,000 for death and bodily injury per accident, and $30,000 for property damage.
  • Coverage that meets the minimum coverage requirements in existing statute related to the state’s no-fault insurance policies, and liability for underinsured and uninsured motorists.

In phases 2 and 3, when the driver accepts and provides the ride for the customer, they would need the following coverage:

  • Primary automobile liability insurance that provides at least $1,500,000 for death, injury, or property damage.
  • Coverage that meets the minimum coverage requirements in existing statute related to the state’s no-fault insurance policies, and liability for underinsured and uninsured motorists.

The bill also requires TNCs to provide various information to their drivers that let them know insurance coverage that must be provided by the TNC vs the driver’s own insurance, and other related information. Additionally, participating driver’s insurance may exclude providing coverage for this situation. Uber and the Insurance Federation of Minnesota have reached a compromise and are in support of the bill. (S.F. 1679)

Senate DFL Media