2017 -- H 5648

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LC001475

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2017

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A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- TRANSPORTATION NETWORK

COMPANY SERVICES

     

     Introduced By: Representatives Edwards, Kennedy, Tobon, Coughlin, and Maldonado

     Date Introduced: March 01, 2017

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

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     SECTION 1. Sections 39-14.2-1, 39-14.2-2, 39-14.2-7, 39-14.2-9, 39-14.2-14 and 39-

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14.2-15 of the General Laws in Chapter 39-14.2 entitled "Transportation Network Company

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Services" are hereby amended to read as follows:

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     39-14.2-1. Definitions.

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     Terms in this chapter shall be construed as follows, unless another meaning is expressed

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or is clearly apparent from the language or context:

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     (1) "Active TNC driver" means a TNC driver who has provided at least one prearranged

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ride through the TNC in the preceding ninety (90) days.

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     (2) "Administrator" means the administrator of the division of public utilities and

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carriers.

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     (3) "Digital network" means any online-enabled technology application service, website,

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or system offered or utilized by a transportation network company that enables the

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prearrangement of rider transportation with transportation network company drivers.

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     (4) "Division" means the division of public utilities and carriers.

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     (5) "Partner" or "partnering" means the act of a TNC operator agreeing to the terms and

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conditions set forth by a TNC for access to the TNC's digital network for the purpose of being

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connected to potential TNC riders seeking TNC services.

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     (6) "Person" means and includes any individual, partnership, corporation, or other

 

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association of individuals.

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     (7) "Personal vehicle" means a vehicle that is used by a transportation network company

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driver and is:

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     (i) Designed to hold no more than seven (7) individuals, including the driver;

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     (ii) Owned, leased, or otherwise authorized for use by the individual; and

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     (iii) Not a jitney, as defined in § 39-13-1; a taxicab or limited public motor vehicle, as

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defined in § 39-14-1; a public motor vehicle, as defined in § 39-14.1-1; or a common carrier as

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defined in title 39.

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     (8) "Transportation network company" or "TNC" means an entity licensed by the division

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pursuant to this chapter that uses a digital network to connect transportation network company

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riders to transportation network operators who provide prearranged rides. A transportation

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network company shall not be deemed to control, direct, or manage the personal vehicles or

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transportation network company drivers that connect to its digital network, except where agreed

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to by written contract.

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     (9) "Transportation network company affiliation placard" or "TNC affiliation placard"

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means a recognizable logo or decal issued by the TNC used to identify personal vehicles

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whenever such a vehicle is available to provide, or is providing, TNC services.

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     (10) "Transportation network operator" or "TNC operator" or "TNC driver" means an

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individual who:

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     (i) Receives connections to potential riders and related services from a transportation

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network company in exchange for payment of a fee to the transportation network company; and

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     (ii) Uses a personal vehicle to offer or provide a prearranged ride to TNC riders upon

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connection through a digital network controlled by a transportation network company in

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exchange for compensation or payment of a fee.

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     (11) "Transportation network company (TNC) rider" or "rider" means an individual or

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persons who uses a transportation network company's digital network to connect with a

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transportation network driver who provides prearranged rides to the rider in the driver's personal

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vehicle between points chosen by the rider.

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     (12) "Transportation network company vehicle owners" means the registered owner or

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lessee of any personal vehicle used to offer or provide a prearranged ride to a transportation

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network company (TNC) rider.

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     (12)(13) "Transportation network company services" or "prearranged ride" means the

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provision of transportation by a TNC driver to a TNC rider beginning when a TNC driver accepts

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a TNC rider's request for a ride made only through a digital network controlled by a

 

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transportation network company (TNC), continuing while the TNC driver transports the

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requesting TNC rider(s), and ending when the last requesting TNC rider(s) departs from the

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personal vehicle. TNC services and prearranged rides do not include transportation provided

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using a jitney, as defined in § 39-13-1; a taxicab or limited public motor vehicle, as defined in §

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39-14-1; a public motor vehicle, as defined in § 39-14.1-1; a common carrier as defined in title

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39, or a regional transportation provider. TNC services and prearranged rides do not include a

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shared-expense carpool or vanpool arrangement or service.

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     39-14.2-2. Not other carriers.

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     (a) TNCs or TNC drivers are not common carriers, as defined in title 39; jitneys, as

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defined in § 39-13-1; taxicabs or limited public motor vehicles, as defined in § 39-14-1; or public

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motor vehicles, as defined in § 39-14.1-1.

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     (b) A TNC driver vehicle owner shall not be required to register the vehicle such TNC

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driver uses for prearranged rides as a commercial or for-hire vehicle.

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     39-14.2-7. Transportation network company operators or TNC operators, TNC

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drivers.

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     (a) No individual shall provide TNC services or transport TNC riders in a personal

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vehicle until the individual shall have first submitted to required, periodic background checks

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conducted through the TNC in accordance with subsection (b).

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     (b) Prior to permitting an individual to accept trip requests through its digital network, a

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TNC shall:

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     (1) Require the individual to submit an application to the TNC. The application shall

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include the individual's driver's name; address; age; driver's license number; photocopy or

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electronic copy of the driver's license; motor-vehicle registration for the personal vehicle that the

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individual intends to use to provide prearranged rides; automobile liability insurance; and other

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information as may be required by the TNC.

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     (2) Conduct, or have a third party accredited by the National Association of Professional

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Background Screeners conduct, a local and national criminal background check for each

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applicant that shall include:

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     (i) Multi-state/multi-jurisdictional criminal records locator or other similar commercial

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nationwide database with validation (primary source search); and

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     (ii) Dru Sjodin National Sex Offender Public Website; and

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     (3) Obtain and review, or have a third party obtain and review, a driving history research

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report for such driving applicant.

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     (c) The TNC shall certify that the required background checks verify that the applicant

 

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meets the following criteria:

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     (1) Has not had more than three (3) moving violations in the prior three-year (3) period,

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or one of the following major violations in the prior three-year (3) period:

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     (i) Attempting to evade the police;

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     (ii) Reckless driving or driving on a suspended; or

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     (iii) Revoked license;

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     (2) Has not, in the past seven (7) years, been convicted of or pleaded nolo contendere to

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any of the following:

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     (i) Driving under the influence of drugs or alcohol;

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     (ii) Felony fraud;

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     (iii) Sexual offenses;

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     (iv) Use of a motor vehicle to commit a felony;

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     (v) Felony crimes involving property damage and/or theft; or

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     (vi) Acts of violence or felony acts of terror;

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     (3) Is not a match in the Dru Sjodin National Sex Offender Public Website;

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     (4) Possesses a valid driver's license;

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     (5) Possesses proof of registration for the motor vehicle to be used to provide prearranged

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rides or TNC services;

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     (6) Possesses proof of automobile liability insurance, that satisfies the financial-

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responsibility requirement for a motor vehicle under § 31-47-2(13)(i)(A), for the motor vehicle(s)

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to be used to provide prearranged rides or TNC services; and

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     (7) Is at least nineteen (19) years of age.

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     (d) TNC operators may be affiliated with or may "partner" with more than one properly

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permitted transportation network company to provide TNC services.

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     39-14.2-9. Vehicles to be utilized to provide TNC services.

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     TNC operators may utilize a personal vehicle to provide licensed TNC services,

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provided:

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     (1) The vehicle is owned by, leased to, or otherwise authorized by the legal owner/lessee

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shall grant express written permission to the TNC for the personal vehicle to be used by a TNC

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operator to provide TNC services: and

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     (2) The vehicle is no older than fifteen (15) model years old and is designed to hold no

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more than seven (7) individuals, including the driver; and

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     (3) The vehicle meets the vehicle-safety inspection requirements for a private motor

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vehicle in Rhode Island, or the state in which the vehicle is registered, performed by a facility

 

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licensed by the state to conduct such inspections, and shall display an according inspection sticker

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on the vehicle's windshield if required to do so by applicable law; and

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     (4) The vehicle shall have met or surpassed sanitary/acceptability standards established

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by the TNC with which the TNC operator has "partnered"; and

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     (5) It shall be prohibited for a TNC operator to connect to a TNC's digital network for the

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purpose of accepting solicitations and providing TNC services in a personal vehicle other than a

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personal vehicle that the TNC operator has registered with the TNC pursuant to § 39-14.2-11.

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     39-14.2-14. Proof of financial responsibility of transportation network companies.

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     (a) On or before ninety (90) days after the effective date of this chapter and thereafter,

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TNC drivers vehicle owners, or a TNC on the driver's and TNC vehicle owners behalf, shall

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maintain primary automobile insurance that:

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     (1) Recognizes that the driver is a transportation network company driver or otherwise

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uses a vehicle to transport riders for compensation and covers the driver and the vehicle owner:

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     (i) While the driver is logged on to the transportation network company's digital network;

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or

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     (ii) While the driver is engaged in a prearranged ride or providing transportation network

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company services.

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     (b) The following automobile liability insurance requirements shall apply during the time

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a TNC driver is logged into the TNC's digital network and available to receive requests for

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transportation but is not providing prearranged rides:

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     (1) Primary automobile liability insurance in the amount of at least fifty thousand dollars

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($50,000) for death and bodily injury per person, one hundred thousand dollars ($100,000) for

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death and bodily injury per incident, and twenty-five thousand dollars ($25,000) for property

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damage.

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     (2) Uninsured and underinsured motorist coverage to the extent required by § 27-7-2.1.

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     (3) The coverage requirements of subsection (b) may be satisfied by any of the following:

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     (i) Automobile insurance maintained by the TNC driver vehicle owner; or

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     (ii) Automobile insurance maintained by the TNC; or

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     (iii) Any combination of subsections (b)(3)(i) and (b)(3)(ii).

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     (c) The following automobile liability insurance requirements shall apply while a TNC

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driver is providing prearranged rides:

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     (1) Primary automobile liability insurance that provides at least one million five hundred

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thousand dollars ($1,500,000) for death, bodily injury, and property damage;

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     (2) Uninsured and underinsured motorist coverage to the extent required by § 27-7-2.1;

 

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     (3) The coverage requirements of this subsection may be satisfied by any of the

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following:

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     (i) Automobile liability insurance maintained by the TNC driver vehicle owner; or

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     (ii) Automobile liability insurance maintained by the TNC; or

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     (iii) Any combination of subsections (c)(3)(i) and (c)(3)(ii).

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     (d) If insurance maintained by a TNC driver vehicle owner to fulfill the insurance

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requirements of subsections (b) and (c) of this section has lapsed or does not provide the required

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coverage, insurance maintained by a TNC shall provide the coverage required by this section

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beginning with the first dollar of a claim and such insurer shall have the duty to defend such

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claim.

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     (e) Coverage under an automobile insurance policy maintained by the transportation

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network company shall not be dependent on a personal automobile insurer first denying a claim

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nor shall a personal automobile insurance policy be required to first deny a claim.

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     (f) Insurance required by this section may be placed with an insurer licensed under § 27-

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2.4-1 et seq., or with a surplus lines insurer eligible under § 27-3-40 that has a credit rating of no

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less than "A-" from A.M. Best, or "A" from Demotech, or similar rating from another rating

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agency recognized by the Rhode Island insurance division.

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     (g) Insurance required by this section shall be deemed to satisfy the financial

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responsibility requirement for a motor vehicle under § 31-47-2(13)(i)(A).

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     (h) A TNC driver or TNC vehicle owner shall carry physical or electronic proof of

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coverage satisfying subsections (b) and (c) with him or her at all times during his or her use of a

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vehicle in connection with a TNC's digital network. In the event of an accident, a TNC driver or

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TNC vehicle owner shall provide this insurance coverage information to the directly interested

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parties, automobile insurers, and investigating police officers, upon request pursuant to § 31-47-

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2(15). Upon such request, a TNC driver shall also disclose to directly interested parties,

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automobile insurers, and investigating police officers, whether they were logged on to the TNC's

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digital network or providing prearranged rides at the time of an accident.

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     39-14.2-15. TNC and insurer disclosure requirements.

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     (a) The TNC shall disclose, in writing, to TNC drivers and the TNC vehicle owners the

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following before they are allowed to accept a request for prearranged rides on the TNC's digital

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network:

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     (1) The insurance coverage, including the types of coverage and the limits for each

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coverage, that the TNC provides while the TNC driver uses a personal vehicle in connection with

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a TNC's digital network; and

 

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     (2) That the TNC driver's vehicle owner's own automobile insurance policy might not

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provide any coverage while the driver is logged on to the TNC's digital network and is available

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to receive transportation requests or is engaged in a prearranged ride, depending on its terms.

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     (b) Insurers that write automobile liability insurance in Rhode Island may exclude any

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and all coverage afforded under the policy issued to an owner or operator of a personal vehicle

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for any loss or injury that occurs while a TNC driver is logged on to a TNC's digital network or

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while a TNC driver provides a prearranged ride. This right to exclude all coverage may apply to

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any coverage included in an automobile insurance policy including, but not limited to:

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     (1) Liability coverage for bodily injury and property damage;

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     (2) Uninsured and underinsured motorist coverage;

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     (3) Medical payments coverage;

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     (4) Comprehensive physical damage coverage;

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     (5) Collision physical damage coverage; and

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     (6) Personal injury protection.

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     Such exclusions shall apply notwithstanding any requirement under § 31-47-2(13)(i)(A).

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Nothing in this section shall be construed as to require an insurer to use any particular policy

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language or reference to this section in order to exclude any and all coverage for any loss or

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injury that occurs while a driver is logged on to a TNC's digital network or while a TNC driver

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provides a prearranged ride.

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     Nothing in this section shall be deemed to preclude an insurer from providing primary or

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excess coverage by contract or endorsement for the TNC driver's vehicle owner's personal vehicle

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while the TNC driver is logged on to a digital network or while the driver is engaged in a

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prearranged ride.

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     (c) Automobile insurers that exclude the coverage described in § 39-14.2-14(b) and (c)

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shall have no duty to defend or indemnify any claim expressly excluded thereunder. Nothing in

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this chapter shall be deemed to invalidate or limit an exclusion contained in a policy including

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any policy in use or approved for use in Rhode Island prior to the enactment of this chapter that

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excludes coverage for vehicles used to carry persons or property for a charge or available for hire

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by the public. An automobile insurer that defends or indemnifies a claim against a vehicle owner

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and driver that is excluded under the terms of its policy, shall have a right of contribution against

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other insurers that provide automobile insurance to the same driver and vehicle owner in

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satisfaction of the coverage requirements of § 39-14.2-14(b) and (c) at the time of loss.

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     (d) In a claims coverage investigation, a TNC shall immediately provide upon request by

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directly involved parties or any insurer of the transportation network company vehicle owner or

 

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driver, if applicable, the precise times that a transportation network company driver logged on

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and off of the TNC's digital network in the twelve-hour (12) periods immediately preceding and

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immediately following the accident. Any insurer providing coverage under § 39-14.2-14(b) and

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(c) shall disclose upon request by any other such insurer involved in the particular claim, the

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applicable coverage, exclusions, and limits provided under any automobile insurance maintained

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under § 39-14.2-14(b) and (c).

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     SECTION 2. This act shall take effect on January 1, 2018.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- TRANSPORTATION NETWORK

COMPANY SERVICES

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     This act would subject TNC vehicle owners to the regulation of transportation network

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companies.

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     This act would take effect on January 1, 2018.

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