It’s a no-go for Uber and Lyft in upstate New York, after the legislature failed to come to terms on a bill that would have authorized ride-hailing services beyond New York City.
The bill — which faced a deadline late Thursday, the end of state’s legislative session — became snagged primarily on the issue of insurance coverage.
Uber and Lyft, the main players in the U.S. ride-hailing market, had been closely involved in the crafting of the “transportation network company” bill in the weeks leading up to the end of the session in Albany, but they balked at an amended version that hiked insurance rates.
The amended version would have required ride-hailing companies to have coverage of $100,000 to $300,000 when a driver is online or on his or her way to pick up a passenger, and $1.5 million while the ride is in progress.
The original version required lower coverage limits, ranging from $50,000-$100,000 in the pre- and post-ride phases, and $1 million during a trip — rates that are comparable to those in many other states where Uber and Lyft operate.
The backer of the amended bill, Assemblyman Kevin Cahill, told Politico that the higher rates were in line with what the companies are required to pay in New York City and Newark.
“Are upstate drivers and passengers less valuable? We think not,” Cahill said.
In the end, Uber and Lyft came out against the bill, and they were joined by an unlikely alliance with taxi driver advocates and insurance companies.
“Insurance limits proposed within the bill are, in many cases, upwards of 6 times higher than what is required of taxis throughout New York,” Uber said in a memorandum opposing the bill.
The higher insurance coverage limits were reportedly backed by trial lawyers, a powerful lobbying group in New York state; the greater the coverage, the larger insurance payouts could be in the event of an accident involving drivers for ride-hailing services.
The debate over the bill in the closing weeks of the session was notable in that it did not hinge on the issue of background checks and fingerprinting for drivers — often a chief concern for Uber and Lyft — but on the insurance coverage. The original bill — backed strongly by the ride-hailing companies — would have left it up to communities whether to impose fingerprinting requirements, along with rules for accommodating disabled passengers.
It’s unlikely at this point that there will be any movement on the issue until the legislature reconvenes in January.
Ride-hailing companies are allowed to operate in New York City, after a bruising fight with regulators that resulted in drivers having to comply with the same licensing rules as taxi drivers.