Call Us 877.277.9036 ☰ ˟
Logo
  • Home
  • Get A Quote
    • Automobile
    • Bonds
    • Business & CommercialImage of right arrow
      • Commercial Auto Insurance Quote
      • General Liability Quote Form
      • Business Owners (BOP) Quote Form
    • Earthquake
    • Farm
    • Flood
    • HomeownersImage of right arrow
      • Homeowners Insurance Quote
      • Manufactured Home Quote
      • Homeowner Flood Quote Form
    • LifeImage of right arrow
      • Life Insurance Quote
      • Term Life Insurance Quote
    • Motorcycle
    • Other
    • Recreational Vehicle
    • Renters
    • Watercraft & Boat
  • Customer Service
    • AutomobileImage of right arrow
      • Request ID Card for Auto Policy
      • Request Declaration and Coverages Page for Auto Policy
      • Send Declaration and Coverages Information to Lien Holder
      • Add Vehicle to Existing Auto Policy
      • Remove Vehicle from Existing Auto Policy
      • Add Driver to Existing Auto Policy
      • Remove Driver from Existing Auto Policy
    • Business & CommercialImage of right arrow
      • Request ID Card for Commercial Auto Policy
      • Request Declaration and Coverages Page for Commercial Auto Policy
      • Add Vehicle to Existing Commercial Auto Policy
      • Remove Vehicle from Existing Commercial Auto Policy
      • Add Driver to Existing Commercial Auto Policy
      • Remove Driver from Existing Commercial Auto Policy
      • Request General Liability Certificate of Insurance
    • Earthquake
    • Flood
    • HomeownersImage of right arrow
      • Request Declaration and Coverages for Existing Homeowners Insurance Coverage
      • Request Evidence of Insurance
    • MotorcycleImage of right arrow
      • Request ID Card for Motorcycle Policy
      • Request Declaration and Coverages Page for Motorcycle Policy
      • Add Motorcycle to Existing Policy
      • Remove Motorcycle from Existing Policy
      • Add Driver to Existing Motorcycle Policy
      • Remove Driver from Existing Motorcycle Policy
    • Other
    • Recreational VehicleImage of right arrow
      • Request ID Card for Recreational Vehicle Policy
      • Request Declaration and Coverages Page for Recreational Vehicle Policy
      • Add Recreational Vehicle to Existing Policy
      • Remove Recreational Vehicle from Existing Policy
      • Add Driver to Existing Recreational Vehicle Policy
      • Remove Driver from Existing Recreational Vehicle Policy
    • Renters
    • Watercraft & BoatImage of right arrow
      • Request ID Card for Watercraft Policy
      • Request Declaration and Coverages Page for Watercraft Policy
      • Add Watercraft to Existing Policy
      • Remove Watercraft from Existing Policy
      • Change Primary Operator on Existing Watercraft Policy
  • Blog
  • Make a Payment
  • Resources
    • Secure File Area
    • Refer a Friend
    • Important Links
    • Calculators
    • Insurance Glossary
    • Frequently Asked Questions
  • About Us
    • About The Miller Insurance Agency
    • Location Map
    • Employee Directory
    • Partners
    • Customer Testimonials
    • Privacy Policy
  • Contact
    • Contact Us
    • Join Our Newsletter
Icon Auto Icon Home
Icon Motorcycle
Icon Business
Icon Bonds Icon Boat & Watercraft
Home > Blog > Commercial Auto Insurance - Ride Sharing
WEDNESDAY, MAY 17, 2017

Commercial Auto Insurance - Ride Sharing

Most cars are, well, under-used. Consider cars used for commuting to work. During the work week, the majority of vehicles are driven to work (or to a mass-transit site), sit there during the entire work day, then are driven back home….where often they sit until the next work day. Those that are used during the workday are often just used to go to lunch. Regardless, many millions of vehicles are parked at a given location rather than in motion.

The cost of owning and operating cars, vans, trucks, and hybrids continues to grow, sometimes explosively (e.g., gas prices). Another major expense, besides gas, maintenance, and repairs, is car insurance. The latter expense is quite similar to car loan payments; it's scarcely affected by how much you use the vehicle. Ridesharing is a method being tried as a way to mitigate these problems.

Essentially, ride-sharing consists of a group arrangement consisting of:

• vehicle owners (and lessees)

• an operating area that is underserved by affordable public transport

• an insurance source

• persons who do NOT have their own vehicles

• a program administrator

Initial arrangements allowed persons who needed, but who didn't own, vehicles to have temporary access to vehicles that were idle during the workday. Both vehicle owners and interested drivers would have to register in a program and then be permitted to share a pool of vehicles – on an appointment basis. The vehicle owners would be paid an established hourly use rate and the program administrator would receive either a flat amount (from drivers and users) or, more commonly, a portion of the hourly rates.

The above situation describes early attempts to create viable rideshare arrangements. However, the landscape has changed dramatically in just the last couple of years. Initial ride-sharing arrangements were fairly inefficient and non-viable due, mostly, to the inability to draw sufficient participants. That issue has largely disappeared. The focus and administration of ride-sharing programs have substantially changed.

Today, several ridesharing companies are operating in locations around the world and their territories are expanding. The key to making these programs viable has been mobile phone technology. Several companies have created mobile phone applications that act as a ride-share administrator.

The process involves an individual using a smartphone to download a ride-share app, then agree to the company's user terms. The terms may vary, including stipulating to a certain proficiency in driving, having a certain amount of insurance coverage in effect, agreeing to maintain coverage, the absence of serious driving and/or criminal violations, and other requirements. Once the app is in place and the terms are agreed to, the ride share driver can turn on the application, respond to ride requests, accept passengers, and take them to their destination and, either go on to another ride request or turn off the application.

So far, such programs have been set-up in different cities. Since there are many millions of vehicle owners with smartphones, there now exists a way to draw in millions of participants. Several companies have become billion-dollar operations that connect vehicle owner/operators with persons needing temporary

transportation.

The largest companies have steered clear of using the term, "ride-sharing," replacing it with "Transportation Networking Companies" or TNCs. Initially, these companies performed the following services:

• Provided and maintained the mobile application and processes

• Recruited vehicle owner/operators

• Monitored transactions

• Established and maintained service price-tiers

As soon as the use of TNCs became significant, complaints arose from taxi operators and from transportation regulators. Taxi operators complained that such services acted in the same manner that they did and severely undercut their prices. Regulators had concerns about service operations as well as compliance with

transportation requirements and oversight of vehicle operators. Another source of complaint was insurance companies.

Insurance companies immediately recognized that protection was needed whenever vehicles were used in TNCs. In the beginning, TNCs depended upon the

coverage carried by its participating vehicle owners/drivers.

Insurance company premiums do not take ride-sharing situations into consideration. Their policy language treats ride-sharing arrangements of TNCs as a business use and such use is excluded. Increasingly insurers have begun to respond to the need of TNC participants. Insurers have clarified that the coverage gap exists specifically during the times that vehicle operators accept requests for rides through the time that they turn off the mobile phone applications and are no longer available to respond to requests.

Therefore, coverage is provided by personal auto insurance when the vehicle owners are NOT using the TNC application. While such drivers are providing PNC service, commercial coverage must be provided on a blanket basis by the TNC. Such coverage must, at a minimum, meet the financial responsibility requirements of the jurisdiction where the participants operate. TNC practices are to license their service on a city-by-city basis.

Regulators in many jurisdictions are grappling with decisions such as, whether to permit TNCs to operate in their area, what rules should be used to oversee them,

whether participants conform to whatever rules are established and, when, if applicable, to issue cease and desist orders.

• California regulators have recently devised a number of rules which involve the following:

• Criminal background checks.

• Driver training

• Minimum of $1 million in insurance

• Required TNC driver licenses

• Vehicle inspections

• Zero tolerance policy regarding use of drugs and alcohol, and

These rules may become models for other jurisdictions that are either dealing with existing TNCs or which are considering the entry of such companies.

If you are participating in, or are considering participation in a ride-sharing arrangement, immediately contact an insurance professional to make sure you are not sacrificing your coverage.

Source - ©The Rough Notes Company, Inc.

Posted 11:01 AM

Tags: commercial auto insurance, commercial insurance, business insurance, business insurance snohomish, business insurance washington state, business insurance everett, commercial insurance everett, commercial insurance snohomish, commercial insurance washington state, business insurance quote, business insurance comparison, commercial insurance quote, commercial insurance comparison, cheap business insurance, cheap commercial insurance, cheap commercial auto insurance,
Share |


NOTICE: This blog and website are made available by the publisher for educational and informational purposes only. It is not be used as a substitute for competent insurance, legal, or tax advice from a licensed professional in your state. By using this blog site you understand that there is no broker client relationship between you and the blog and website publisher.
Blog Archive
  • 2023
  • 2022
  • 2021
  • 2020
  • 2019
  • 2018
  • 2017
  • 2016
  • 2015
  • 2014

  • insurance agent everett wa(64)
  • insurance agency everett wa(63)
  • insurance everett wa(58)
  • the miller insurance agency everett wa(48)
  • insurance everett(44)
  • home insurance everett wa(36)
  • auto insurance quote everett(34)
  • insurance(32)
  • auto insurance everett(32)
  • car insurance everett(32)
  • auto insurance everett wa(32)
  • home insurance(31)
  • auto insurance comparison(31)
  • auto insurance(29)
  • home insurance everett(29)
  • auto insurance quote snohomish(29)
  • auto insurance quote(28)
  • car insurance everett wa(28)
  • insurance quote everett wa(27)
  • insurance quote everett(26)
  • auto insurance comparison everett(26)
  • car insurance snohomish(25)
  • insurance snohomish(24)
  • insurance quote snohomish(24)
  • safeco auto insurance(24)
  • auto insurance washington(24)
  • car insurance washington(21)
  • business insurance everett(21)
  • auto insurance comparison snohomish(21)
  • business insurance snohomish(20)
  • progressive auto insurance(20)
  • pemco auto insurance(20)
  • auto insurance snohomish(20)
  • car insurance(20)
  • business insurance(20)
  • car insurance comparison(19)
  • home insurance quote everett wa(19)
  • travelers auto insurance(19)
  • commercial insurance everett wa(18)
  • car insurance quote(18)
  • commercial insurance everett(18)
  • cheap auto insurance(18)
  • safeco insurance(17)
  • cheap car insurance(17)
  • home insurance snohomish(16)
  • business insurance quote everett wa(16)
  • insurance washington(15)
  • renters insurance everett wa(15)
  • home insurance washington state(15)
  • commercial insurance snohomish(14)

View Mobile Version
Superior Service, Savings and Selection
Social Social Social Social Social
Quick Links
Home
Get A Quote
Customer Service
Payment Options
Report a Claim
About Us
Our Carriers
Testimonials
Blog
Contact Us
Location 3301 Hoyt Ave
Everett, WA 98201

--
Local: 425.212.3505
Toll-Free: 877.277.9036
Fax: 425.212.3506
Powered by Insurance Website Builder