New York City Mayor Eric Adams has enacted a new law that reduces the mandatory auto liability insurance coverage for for-hire vehicles.
The new legislation lowers the required personal injury protection (PIP), or no-fault insurance coverage, for the city’s 74,000 drivers—including those working for Uber, Lyft, yellow taxis, and liveries—from the existing $200,000 to $100,000 per individual.
The $200,000 PIP coverage mandate for drivers in New York City has been set at four times the $50,000 per person requirement imposed on comparable drivers across the rest of the state.
The City Council unanimously supported the measure with a 50-0 vote, alongside one abstention.
Citizens for Affordable Rates (CAR), an organization supported by Uber, praised the change, stating it will alleviate the financial burden on drivers—many of whom are immigrants and small business owners. Proponents of the reform believe it will help reduce insurance premiums, curb fraudulent claims, and encourage more insurers to enter the city’s for-hire vehicle insurance market.
The group argues that the former $200,000 coverage requirement contributed to increased litigation and fraudulent claims, referencing a New York State Department of Financial Services report which revealed that suspected no-fault insurance fraud comprised 75% of all fraud reports received by the department in 2023.
“For years, New York City’s for-hire drivers have been burdened by an unjust, outdated insurance mandate that inflated costs, limited their options, and encouraged widespread fraud. Those days are coming to an end,” said Council Member Carmen De La Rosa, the lead sponsor of the bill.
The legislation signed by Adams bars the Taxi and Limousine Commission (TLC) from mandating that vehicles it licenses carry PIP liability coverage exceeding 200% of the state law requirement for drivers in other parts of New York.
“TLC-licensed drivers keep our city moving,” said Adams. “Many of these working-class New Yorkers are immigrants trying to build a better life here in the Big Apple, but for too long, our TLC-Licensed drivers have had to pay higher rates for no fault or personal injury insurance for their vehicles, burdening drivers and owners with thousands of dollars in costs and putting pressure on their monthly bills.”
The signing occurs amid worries about the possible collapse of American Transit Insurance Co. (ATIC), which currently covers over 60% of the city’s for-hire vehicle fleet. De La Rosa and other advocates believe the reform could attract new insurers to the market while offering drivers protection amid uncertainties surrounding their future coverage.
Supporters initially aimed to reduce the for-hire drivers’ coverage limit from $200,000 to $50,000 per person, matching the state’s requirement for all other drivers. According to De La Rosa, this would have saved drivers approximately $600 annually. With the new $100,000 limit, however, the savings are expected to be closer to $300 per year.
The head of the city’s Taxi and Limousine Commission remains skeptical that drivers will see any benefits. During a February hearing before the City Council’s transportation committee, TLC Chair David Do stated, “It is not clear premiums would go down as any savings may be kept by insurers and not passed to drivers.”
The city’s legislation is part of a wider effort by Uber and CAIR to tackle the high insurance costs both locally and statewide. CAIR is pushing for reforms aimed at combating no-fault insurance fraud and reducing frivolous litigation. The organization has also launched a media campaign urging lawmakers in Albany to take action.
