Source: http://agencychecklists.com/2016/08/01/legislature-gets-transportation-network-law-on-the-books-in-the-nick-of-time-14625/
Timestamp: 2017-10-19 10:50:48
Document Index: 71007654

Matched Legal Cases: ['§ 228', '§228', '§ 228', '§ 228', '§ 228', '§ 113', '§ 34', '§ 228', '§ 228', '§ 34', '§ 113', '§ 34']

Legislature Gets Transportation Network Law On The Books In The Nick Of Time | Agency Checklists
Legislature Gets Transportation Network Law On The Books In The Nick Of Time
August 1, 2016 by Owen Gallagher Leave a Comment
Late Sunday night, a six-person conference committee of the House and Senate successfully agreed on a compromise transportation network company bill just before this years legislative session ended at midnight. The bill quickly passed and was laid on the governor’s desk for signature. The governor has not stated publicly whether he will sign the bill.
New chapter added to the General Laws for transportation network companies
The law adds a new chapter to the General Laws, Chapter 159A1/2, and amends the insurance laws by adding § 228 to Chapter 175.
This statute establishes a new division in the Department of Public Utilities that is charged with the “administration, implementation, and enforcement of a new chapter added to the general laws, Chapter 159A 1/2. This division will “perform such functions as the Department [of Public Utilities] may determine in relation to the administration, implementation, and enforcement of Chapter 159A1/2.
This new chapter regulates any transportation network company that the law defines as: “[anyone] …that uses a digital network to connect riders to drivers to pre-arrange and provide transportation.”
The law also would regulate transportation network drivers, who are defined as: “…a driver certified by a transportation network company.”
An important component of the proposed law relates to the insurance provisions required of transportation network companies and their drivers. These provisions are contained in a specific amendment to the insurance laws designated as Chapter 175 §228.
Under the law, Transportation Network Drivers must obtain a “Transportation Network Driver Certificate.” This certificate is “an authorization to provide transportation network services issued by the transportation network company” such as Uber or Lyft to the driver. The division will require that a transportation network company only issue a transportation network driver
certificate to a driver who among other conditions:
…complies with insurance requirements established in this chapter or in section 228 of chapter 175;, and
provides notice to all insurers of the vehicle that the applicant intends to use the vehicle to provide transportation network services; … (Emphasis added).
Required coverage for all Transportation Network Drivers
Transportation Network Companies must carry adequate insurance as set forth in the new § 228 of Chapter 175 for each vehicle being used to provide transportation network services.
Likewise, the law requires that each transportation network driver also carry adequate insurance as required by the insurance section for each vehicle being used to provide transportation network services.
The required insurance coverages under § 228 have two separate limits
Under the new § 228, the required coverage and limits that satisfy the financial responsibility requirements for a vehicle operating as a transportation network company vehicle, taxicab, or livery vehicle depends upon the status of the vehicle in the network.
uninsured motorist coverage to extent required by § 113L of chapter 175, and
personal injury protection to the extent required by § 34A of chapter 90;
This insurance “may be held by the transportation network driver, the transportation network company or a combination thereof.”
This insurance also “may be held by the transportation network driver, the transportation network company or a combination thereof.”
The law also provides that if the insurance supposedly maintained by the driver, “has lapsed, failed to provide the required coverage, denied a claim for the required coverage, or otherwise ceased to exist,” then the ride for hire company is responsible. That company must provide the coverage required by § 228, from the first dollar of a claim as well as to discharge the duty to investigate and defend such claim.
Section 228, of G.L. c. 175, will ban this type of contingent coverage for transportation network companies. Instead, § 228 states that:
Section 228 states that a transportation network driver satisfying the insurance requirements specified in that section satisfies the financial responsibility requirement for a motor vehicle under the compulsory insurance laws found in chapter 90, § 34A and § 113L of chapter 175.
However, that provision has a specific caveat. It states that the driver only satisfies those insurance requirements for a motor vehicle “with respect to the provision of transportation network services in a vehicle operated by a transportation network driver.”
The driver or owner still must comply with Massachusetts’ compulsory automobile insurance laws and maintain insurance coverage for the vehicle “during those periods of time when the vehicle is being operated, but is not providing transportation network services.”
The Bill also would require that a transportation network company disclose in writing to transportation network drivers, the following insurance information, before the drivers before certifying the driver to provide transportation network company’s digital network. The mandatory information must include:
a statement that the transportation network driver’s own automobile insurance policy may not provide coverage while the driver is providing transportation network services, depending on that policy’s terms.
The new law does not affect this existing endorsement. The law specifically states that:
Insurers that write automobile insurance may exclude any and all coverage afforded under the policy issued to an owner or operator of a vehicle for any loss or injury that occurs while a driver is providing transportation network services or while a driver provides a pre-arranged ride.
Personal injury protection coverage as defined in chapter 90, § 34A;
The law’s provisions also specifically provide that if an insurer has excluded the coverage described in this section that it “shall have no duty to defend or indemnify any claim expressly excluded thereunder.”
Insurance required by this section shall be placed with an insurer authorized to do business in the commonwealth or, if such coverage is not available, from any admitted carrier, then with a surplus lines insurer eligible pursuant to section 168.
(5) any recommended action by the Division of Insurance, the [new Public Utilities] division, the legislature, or any other government entity that would encourage the insurance market to provide policies with higher insurance rates while transportation network companies are not engaged in a pre-arranged ride.
Some additional provisions in the law not relating to insurance
The new law, of course, has a number of provisions relating to transportation network companies, transportation network drivers, and other ride for hire vehicles that include taxicabs and livery vehicle besides and transportation network vehicles.
Background checks for transportation network drivers. The law provides for background checks first by the transportation network companies and then by the new division in the Department of Public Utilities.
Transportation network drivers are not prohibited from picking up riders e at Logan Airport or the Boston Convention and Exhibition Center after these entities establish rules for transportation network companies.
Filed Under: Law Alerts, Mass Insurance News Tagged With: ma insurance news, Mass. Insurance News, Mass. TNC Law