The New York City Council passed a bill by a vote of 50 to 0 (with 1 abstention) to lower the personal injury insurance (PIP) requirements for rental vehicles, reducing the minimum limit from $200,000 per person to $100,000. This move was promoted by City councilor Carmen De La Rosa and the Uber-backed alliance CAIR, aiming to reduce drivers’ premiums and curb fraud. Supporters believe that excessively high insurance limits have encouraged fraud, leading to higher premiums that are eventually passed on to passengers. Although drivers originally hoped that the limit would be reduced to $50,000, the same as in other areas of the state, the new regulation is expected to still save drivers about $100 each year.
David Do, the chairperson of the New York City Taxi and Limar Commission (TLC), questioned whether premiums would truly decline, arguing that cost savings might be withheld by insurance companies rather than benefiting drivers. Furthermore, supporters hope that the new regulations will attract more Insurance companies to enter the market, especially against the backdrop of the bankruptcy of the major supplier, American Transit Insurance Co. (ATIC). ATIC claims that it has long been burdened by no-fault insurance fraud, and the new bill may help alleviate this problem.
This amendment to the law is part of a larger-scale reform pushed by Uber and CAIR, aiming to address the high insurance costs in New York City and across the state. CAIR is calling on state legislatures to further combat no-fault insurance fraud and excessive litigation. With the bill submitted to Mayor Eric Adams for signature, the taxi industry in New York City may witness a major adjustment in its premium structure.
Related Topic:
