1     
TRANSPORTATION NETWORK COMPANY AMENDMENTS

2     
2016 GENERAL SESSION

3     
STATE OF UTAH

4     
Chief Sponsor: Curtis S. Bramble

5     
House Sponsor: ____________

6     

7     LONG TITLE
8     General Description:
9           This bill amends provisions related to a transportation network company.
10     Highlighted Provisions:
11          This bill:
12          ▸      repeals a requirement that a transportation network company or transportation
13     network driver maintain comprehensive and collision coverage for a vehicle used by
14     a transportation network driver to provide transportation network services;
15          ▸     creates the Transportation Network Vehicle Recovery Fund;
16          ▸     requires a transportation network company to pay into the fund:
17               •     an initial assessment; and
18               •     a payment per each prearranged ride;
19          ▸     allows a person who holds a lien on a vehicle that a transportation network driver
20     uses to provide transportation network services to make a claim to the Division of
21     Consumer Protection for payment from the fund for physical damage to the vehicle;
22     and
23          ▸     provides criteria under which the Division of Consumer Protection may grant a
24     claim.
25     Money Appropriated in this Bill:
26          None
27     Other Special Clauses:
28          None
29     Utah Code Sections Affected:
30     AMENDS:
31          13-51-108, as enacted by Laws of Utah 2015, Chapter 244 and last amended by
32     Coordination Clause, Laws of Utah 2015, Chapter 244
33     ENACTS:
34          13-51-201, Utah Code Annotated 1953
35          13-51-202, Utah Code Annotated 1953
36          13-51-203, Utah Code Annotated 1953
37     

38     Be it enacted by the Legislature of the state of Utah:
39          Section 1. Section 13-51-108 is amended to read:
40          13-51-108. Insurance.
41          (1) A transportation network company or a transportation network driver shall maintain
42     insurance that covers, on a primary basis, a transportation network driver's use of a vehicle
43     during a prearranged ride and that includes:
44          (a) an acknowledgment that the transportation network driver is using the vehicle in
45     connection with a transportation network company during a prearranged ride or that the
46     transportation network driver is otherwise using the vehicle for a commercial purpose;
47          (b) liability coverage for a minimum amount of $1,000,000 per occurrence;
48          (c) personal injury protection to the extent required under Sections 31A-22-306
49     through 31A-22-309;
50          (d) uninsured motorist coverage where required by Section 31A-22-305; and
51          (e) underinsured motorist coverage where required by Section 31A-22-305.3.
52          (2) A transportation network company or a transportation network driver shall maintain
53     insurance that covers, on a primary basis, a transportation network driver's use of a vehicle
54     during a waiting period and that includes:
55          (a) an acknowledgment that the transportation network driver is using the vehicle in
56     connection with a transportation network company during a waiting period or that the
57     transportation network driver is otherwise using the vehicle for a commercial purpose;
58          (b) liability coverage in a minimum amount, per occurrence, of:
59          (i) $50,000 to any one individual;
60          (ii) $100,000 to all individuals; and
61          (iii) $30,000 for property damage;
62          (c) personal injury protection to the extent required under Sections 31A-22-306
63     through 31A-22-309;
64          (d) uninsured motorist coverage where required by Section 31A-22-305; and
65          (e) underinsured motorist coverage where required by Section 31A-22-305.3.
66          [(3) A transportation network company or a transportation network driver shall
67     maintain comprehensive and collision insurance that covers, on a primary or contingent basis, a
68     transportation network driver's use of a vehicle while providing transportation network
69     services, and that includes:]
70          [(a) an acknowledgment that the transportation network driver is using the vehicle in
71     connection with a transportation network company during a prearranged ride or waiting period,
72     or that the transportation network driver is otherwise using the vehicle for a commercial
73     purpose; and]
74          [(b) coverage limits that are at least equal to such coverage limits, if any, for the
75     personal automobile insurance maintained by the vehicle's owner and reported to the
76     transportation network company.]
77          [(4)] (3) A transportation network company and a transportation network driver may
78     satisfy the requirements of Subsections (1)[, (2),] and [(3)] (2) by:
79          (a) the transportation network driver purchasing coverage that complies with
80     Subsections (1)[, (2),] and [(3)] (2);
81          (b) the transportation network company purchasing, on the transportation network
82     driver's behalf, coverage that complies with Subsections (1)[, (2),] and [(3)] (2); or
83          (c) a combination of Subsections [(4)] (3)(a) and (b).
84          [(5)] (4) An insurer may offer to a transportation network driver a personal automobile
85     liability insurance policy, or an amendment or endorsement to a personal automobile liability
86     policy, that:
87          (a) covers a private passenger motor vehicle while used to provide transportation
88     network services; and
89          (b) satisfies the coverage requirements described in Subsection (1)[, (2),] or [(3)] (2).
90          [(6)] (5) Nothing in this section requires a personal automobile insurance policy to
91     provide coverage while a driver is providing transportation network services.
92          [(7)] (6) If a transportation network company does not purchase a policy that complies
93     with Subsections (1)[, (2),] and [(3)] (2) on behalf of a transportation network driver, the
94     transportation network company shall verify that the driver has purchased a policy that
95     complies with Subsections (1)[, (2),] and [(3)] (2).
96          [(8)] (7) An insurance policy that a transportation network company or a transportation
97     network driver maintains under Subsection (1) or (2):
98          (a) satisfies the security requirements of Section 41-12a-301; and
99          (b) may[, along with insurance maintained under Subsection (3),] be placed with:
100          (i) an insurer that is certified under Section 31A-4-103; or
101          (ii) a surplus lines insurer licensed under Section 31A-23a-104.
102          [(9)] (8) An insurer that provides coverage for a transportation network driver
103     explicitly for the transportation network driver's transportation network services under
104     Subsection (1) or (2) shall have the duty to defend a liability claim arising from an occurrence
105     while the transportation network driver is providing transportation network services.
106          [(10) (a)] (9) If insurance a transportation network driver maintains under Subsection
107     (1)[, (2),] or [(3)] (2) lapses or ceases to exist, a transportation network company shall provide
108     coverage complying with Subsection (1)[, (2),] or [(3)] (2) beginning with the first dollar of a
109     claim.
110          [(b) Subsection (10)(a) does not apply to comprehensive or collision insurance
111     otherwise required under Subsection (3) if, at the time of a claim for damage to a vehicle being
112     used to provide transportation network services, there is no outstanding lien on the vehicle.]
113          [(11)] (10) (a) An insurance policy that a transportation network company or
114     transportation network driver maintains under Subsection (1) or (2) may not provide that
115     coverage is dependent on a transportation network driver's personal automobile insurance
116     policy first denying a claim.
117          (b) Subsection [(11)] (10)(a) does not apply to coverage a transportation network
118     company provides under Subsection (9) in the event a transportation network driver's coverage
119     under Subsection (1) or (2) lapses or ceases to exist.
120          [(12)] (11) A personal automobile insurer:
121          (a) notwithstanding Section 31A-22-302, may offer a personal automobile liability
122     policy that excludes coverage for a loss that arises from the use of the insured vehicle to
123     provide transportation network services; and
124          (b) does not have the duty to defend or indemnify a loss if an exclusion described in
125     Subsection (12)(a) excludes coverage according to the policy's terms.
126          Section 2. Section 13-51-201 is enacted to read:
127     
Part 2. Transportation Network Vehicle Recovery Fund

128          13-51-201. Transportation Network Vehicle Recovery Fund -- Creation -- Report
129     to the Legislature.
130          (1) As used in this part, "fund" means the Transportation Network Vehicle Recovery
131     Fund created in Subsection (2).
132          (2) There is created an expendable special revenue fund called the "Transportation
133     Network Vehicle Recovery Fund."
134          (3) The fund consists of:
135          (a) the amount collected by the division under Subsection 13-51-202(1); and
136          (b) interest earned on the money in the fund.
137          (4) The division shall deposit the money collected for the fund in an account with the
138     state treasurer and record the money in the fund.
139          (5) The division may hire employees and allocate resources necessary to administer the
140     fund.
141          (6) The division shall use money from the fund to cover the division's cost to
142     administer this part.
143          (7) The division shall report to the Business and Labor Interim Committee, before
144     November 1 of each year, on the amount of:
145          (a) money that the division collected for the fund during the year;
146          (b) disbursements that the division made from the fund during the year;
147          (c) interest earned by the fund; and
148          (d) total money in the fund.
149          (8) On January 1, 2017:
150          (a) the fund shall cease to exist; and
151          (b) the division shall disburse any money remaining in the fund to each transportation
152     network company licensed in the state that contributed to the fund in an amount that is
153     proportional to the total amount the transportation network company contributed to the fund.
154          Section 3. Section 13-51-202 is enacted to read:
155          13-51-202. Per-ride payment -- Initial assessment.
156          (1) Subject to Subsection (2), the division shall collect, from each transportation
157     network company licensed under this chapter:
158          (a) on June 10, 2016, an initial assessment in the amount of $15,000; and
159          (b) on the first day of each quarter, a payment of $0.10 for each prearranged ride.
160          (2) If, on the first day of a given quarter, the amount of money in the fund is greater
161     than or equal to $50,000, the division may not collect the payment for each prearranged ride
162     described in Subsection (1)(b) for that quarter.
163          (3) If the division does not collect a payment under Subsection (2) in a given quarter,
164     the division shall resume collecting the prearranged ride payment described in Subsection
165     (1)(b) on the first day of the next quarter on which the amount of money in the fund is less than
166     $50,000.
167          Section 4. Section 13-51-203 is enacted to read:
168          13-51-203. Payment of a claim from the fund.
169          (1) A person that holds a lien on a vehicle used by a transportation network driver to
170     provide transportation network services may submit a claim to the division for payment from
171     the fund for physical damage to the vehicle.
172          (2) The division shall pay a claim for payment from the fund to a person that holds a
173     lien on a vehicle described in Subsection (1) for physical damage to the vehicle if:
174          (a) the physical damage to the vehicle occurred during a waiting period or a
175     prearranged ride;
176          (b) the lien complies with Section 41-1a-601;
177          (c) the person required the transportation network driver, by contract, to maintain
178     insurance coverage for physical damage to the vehicle;
179          (d) the insurance coverage described in Subsection (2)(c):
180          (i) names the person as the loss payee;
181          (ii) was in effect at the time the physical damage occurred; and
182          (iii) denied coverage to the person as the loss payee on the sole basis that the
183     transportation network driver used the vehicle to provide transportation network services in the
184     state; and
185          (e) the division determines, no earlier than ten days after the day on which the person
186     makes the claim, that:
187          (i) no other insurance is available from the relevant transportation network company;
188     and
189          (ii) the fund has enough money to cover the cost of the claim.
190          (3) If the division grants a claim to a person for a lien on a transportation network
191     driver's vehicle under Subsection (2), the fund shall pay the person the lesser of:
192          (a) the cost to repair the vehicle; or
193          (b) the actual cash value of the vehicle less any salvage costs.




Legislative Review Note
Office of Legislative Research and General Counsel