What is Ride-Sharing and does my personal insurance policy cover it?
Answer: Ride-sharing, or Transportation Network Companies (TNCs) such as Uber and Lyft provide taxi-like services in Private Passenger Vehicles by connecting passengers with drivers via a smart phone app. No, your personal policy does not cover TNC activities unless your insurance carrier offers a special add-on Endorsement which you much purchase to obtain coverage. As of today there are only a handful of companies in MA which offer such an Endorsement – thankfully we represent one of them: Plymouth Rock Assurance.
The main problem with TNC coverage arises because the Massachusetts Personal Auto Policy specifically excludes coverage “For accidents while your auto is being used as, or is available for use as, a public or livery conveyance, including a vehicle for hire through a ride-sharing program, car-sharing program, and transportation network service which operate under an agreement and for compensation.” This means that when a TNC driver turns on the app to begin accepting rides their personal auto policy no longer provides coverage until the passenger is dropped off and they’re no longer soliciting rides.
In addition, the MA Auto Policy also requires the insured to: “You must inform us of any changes which may have a material effect on your insurance coverage or premium charges. This includes the description, ownership, type of usage and place of garaging of your auto.” This means you must inform the insurance company if you are operating as a TNC and if you do, your policy will most likely be canceled/non-renewed since it doesn’t meet company Underwriting Guidelines. There is a question on every MA Auto Insurance Application that specifically asks if any passengers are being transported for a fee and if they are, the insurer can refuse to write the policy.
If an accident happens during the time a TNC Operator is accepting rides then there would be no coverage under the personal auto policy, coverage may be available from the TNC Company however that’s not something we can comment since there are multiple TNC carriers and they have different coverage options.
Please give us a call at 508-222-0794 if you’d like to discuss obtaining coverage for your vehicle through Plymouth Rock’s new “TNC Endorsement”.