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Liability insurance policies for transportation network companies (TNC) in New Jersey must include personal injury protection (PIP) benefits for uninsured pedestrians injured by a TNC vehicle, New Jersey appellate court has ruled.

Liberty Mutual denied an uninsured pedestrian coverage after he was injured by a driver for Lyft, a TNC or ride-hailing company that Liberty Mutual insured under a liability policy. The insurer said its Lyft policy did not include PIP benefits and it was not required to offer them under the state’s ,

An Atlantic County trial court rejected Liberty Mutual’s reading of the law, finding that since TNC vehicles are defined as personal vehicles, standard motor vehicle laws apply and require pedestrian PIP coverage.

The Appellate Division of the Superior Court agreed, concluding that every motor vehicle liability policy, including one issued to a TNC, has to provide pedestrian PIP benefits. The court ordered Liberty Mutual to reform its liability policy for Lyft to include the coverage for an uninsured pedestrian injured by a Lyft driver.

Plaintiff Lamar Boone was allegedly struck by the vehicle of Jean E. Zamor while Zamor was operating as a driver for Lyft. Boone did not own a motor vehicle or reside with anyone who owned a motor vehicle. Therefore, he did not have any direct insurance coverage to pay his medical expenses.

Since Zamor was logged into Lyft’s network and transporting a passenger when the accident occurred, Zamor’s vehicle was being used as “a livery conveyance for passengers” and thus was not considered a private passenger automobile.

While the TNC Act does not specifically address pedestrian PIP coverage benefits, the court found the legislature extended this protection under another law that mandates that liability insurance policies for motor vehicles other than standard private passenger automobiles鈥攊ncluding motorcycles, motorized bicycles, and commercial or rideshare vehicles鈥攎ust provide PIP benefits to pedestrians who suffer bodily injury or death.

In addition, the court referenced an order by the New Jersey Department of Banking and Insurance that requires that all commercial vehicle insurance policies contain pedestrian PIP coverage.

The court noted that lawmakers could have expressly exempted pedestrians from PIP benefits in the TNC Act but they did not. Instead, the court said that uninsured pedestrians are a specific and separate class of individuals that the legislature intended to provide no-fault PIP coverage benefits under other laws that are supposed to work in harmony with the TNC Act.

After Liberty Mutual denied his claim, Boone submitted a claim for PIP benefits to the New Jersey Property-Liability Insurance Guaranty Association (NJPLIGA), which administers the Unsatisfied Claim and Judgment Fund (UCJF), which also denied plaintiff’s claim. This time the denial was on the basis that the vehicle involved was being used as a commercial vehicle for ridesharing and was not an automobile covered by the UCJF law. The court agreed that the scope of PIP benefits for pedestrians in the UCJF is limited and the UCJF was inapplicable to Boone’s case.

Topics New Jersey