Liberty Mutual Insurance will provide coverage for Uber drivers and passengers throughout New England, South Carolina and Puerto Rico as part of the company’s 2020 auto insurance programs, which became effective on Dec. 31, 2019.
The move by the Boston-based insurer comes after another insurer, James River, said it is dropping Uber as an account.
Under its program, Liberty Mutual said it provides specific coverages from the time Uber drivers open the app and are waiting for a trip or delivery request through the completion of the trip or delivery. The program is being rolled out in Puerto Rico and selected states only: South Carolina and the New England states of Massachusetts, Connecticut, Rhode Island, Vermont, New Hampshire and Maine.
The program was developed by the insurer’s dedicated sharing economy and new mobility risks unit. The unit, which is focused on providing custom products and claims service for ride-hailing, vehicle-sharing, car subscription, delivery services and autonomous vehicle companies, is headed by Senior Vice President and Chief Underwriting Officer David Blessing. “We drew on our competitive advantage of vast commercial and personal lines expertise, including our best-in-class claims and service organizations, to meet the specific risk management challenges facing the company’s ride-hailing and delivery operations,” Blessing said.
Uber’s vice president of safety and insurance, Gus Fuldner, welcomed Liberty Mutual. “At Uber, we want both drivers and riders to have peace of mind during trips, and Liberty Mutual helps fulfill that obligation,” Fuldner was quoted as saying in the insurer’s announcement.
Liberty Mutual also appears to be helping to fill a gap in Uber’s insurance program exposed in the Oct. 8 announcement by James River Group that it is dropping Uber, its largest client, and cancelling all Uber policies as of Dec. 31.
“This account has not met our expectations for profitability, and we think it best to terminate the underwriting relationship as of year end,” said J. Adam Abram, James River chairman and chief executive officer.
James River was a pioneer in offering insurance to transportation network companies including Uber. The insurer acknowledged that it mispriced policies in its first few years with Uber and in 2017 had to restrict its writings in Florida, which it said was a major contributor to losses.
Abram also said that the insurer believes that California’s new “gig” worker law governing contract workers such as ride-hailing drivers “will adversely alter the claims profile for ride-share companies” going forward. Uber has sued to block the law.
After St. James announced its exit, Uber told the Wall Street Journal it expected other insurers to replace James River as part of its insurance program.
Allstate, Farmers, Progressive and other carriers also provide coverage for Uber drivers. Uber also has a captive insurance subsidiary to cover certain risks.
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