New insurance products will be available for TNC drivers
California officials have approved new auto insurance products that will affect the Transportation Network Company (TNC) space. Companies like Uber and Lyft have had a major impact on the insurance space, largely due to concerns that these companies are not providing adequate coverage for their drivers. Insurers are beginning to take note of the rising popularity of TNC and, in order to mitigate risks, have begun offering new insurance policies. State Farm is among these companies.
State Farm is among several others that are offering new auto insurance products to the TNC industry
State Farm is one of eight auto insurance providers that have begun offering new coverage options for TNC drivers. Insurance Commissioner Dave Jones has encouraged several companies to develop such products in order to ensure that TNC drivers are adequately covered. State Farm’s new auto insurance product will become available on March 21, according to the California Department of Insurance. Jones notes that more insurers are beginning to show interest in providing coverage for the TNC industry, which may be good news for those working for ride-share companies.
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Insurance gap has created controversy for Uber and Lyft
State Farm notes that the TNC industry has had a major impact on the traditional taxi industry through the use of mobile technology. Those looking for rides can use a simple mobile application to hire a driver. In the past, concerns regarding the auto insurance that was used to protect these drivers had ignited controversy focused on Uber and Lyft. In California, state officials were concerned that an insurance gap existed within the TNC industry, leaving drivers and consumers exposed to unnecessary risks.
New insurance products may put a rest to the insurance gap
Generally, TNC drivers are only covered when they are actually transporting a paying passenger. Drivers have a much lower level of coverage when they are waiting to be contacted by a potential customer. State Farm aims to resolve this issue with its new auto insurance product, and the company will not be alone. State officials believe that the new insurance products will help resolve the apparent insurance gap that has plagued the TNC industry for some time.