Auto insurance legislation targeting ride-share companies has failed in Hawaii

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New legislation fails to pass committee

New legislation in Hawaii that would require drivers working for transportation network companies like Uber and Lyft to have a higher level of auto insurance coverage has been struck down by the House Consumer Protection and Commerce Committee. The legislation would have introduced more regulation to the transportation network company industry, which is growing quite rapidly throughout the United States. Both Uber and Lyft have been targeted by such legislation before, with lawmakers in some states showing concern over potential insurance gaps.

Legislation would have required drivers to have more insurance coverage

The legislation would have required drivers to carry primary liability coverage, which would be in effect while the driver was traveling to pick up a passenger and while transporting this passenger. Such policies would provide $100,000 in coverage per person per accident, with an aggregate limit of $200,000 per accident. These policies would also have to provide $50,000 in coverage for property damage. Notably, Uber and Lyft, as well as other transportation network companies, already provide insurance coverage for their drivers, with this coverage generally surpassing the  minimum requirements in states where they operate.

Uber sought to fight the legislation earlier this week

rideshare auto Insurance accident crashEarlier this week, Uber began asking its customers in Hawaii to sign a petition meant to combat the legislation. The company suggested that, if passed, the legislation could make it impossible to compete in the state. The petition received some 9,500 signatures, which was 5,500 away from its goal. Despite the failure of the petition, lawmakers did take note of the significant response coming from consumers. Legislators may seek a new way to affect the ride-share sector in the future in an effort to protect consumers and drivers alike.

Several states have enacted new regulations concerning ride-share companies

As of January 1 of this year, 29 states have enacted regulations focused on transportation network companies. Potential insurance gaps have become a cause for concern among lawmakers, as such gaps could leave people exposed to extreme financial risks. Legislation may be required to address this issue, but finding ways to adequately require ride-share companies to offer more auto insurance coverage without affecting their ability to operate effectively has proven difficult.

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