Background
Lamar Boone, an uninsured pedestrian, was allegedly struck by Jean E. Zamor’s vehicle while Zamor was driving for Lyft during a prearranged ride. Boone did not own a vehicle or live with anyone who did, so he lacked other insurance providing personal injury protection benefits. Liberty Mutual insured Lyft under a business automobile policy that included liability coverage but excluded PIP benefits for uninsured pedestrians.
Liberty Mutual denied Boone’s claim for medical-expense benefits, and the New Jersey Property-Liability Insurance Guaranty Association, as administrator of the Unsatisfied Claim and Judgment Fund, also denied coverage. The trial court granted summary judgment to Boone and NJPLIGA, ordered Liberty Mutual’s policy reformed to include pedestrian PIP coverage, and denied Liberty Mutual’s summary-judgment and reconsideration motions. Liberty Mutual appealed.
The Court’s Holding
The Appellate Division affirmed. It held that N.J.S.A. 17:28-1.3 requires every New Jersey liability policy covering a motor vehicle that is not an “automobile” as statutorily defined—including a transportation network company driver’s personal vehicle during a prearranged ride—to provide PIP benefits to otherwise uninsured pedestrians. The TNC Act’s exclusivity provision did not displace that requirement because the Act neither expressly excludes pedestrian PIP coverage nor exempts insurers from the insurance-policy mandates in Title 17.
Because Zamor was providing a prearranged Lyft ride, his vehicle was statutorily classified as a motor vehicle rather than an “automobile,” and Lyft’s Liberty Mutual liability policy was in effect. The court therefore held that the policy had to be reformed to supply the mandatory PIP coverage omitted from its terms. It also rejected Liberty Mutual’s argument that Lyft was not the relevant named insured, reasoning that the vehicle was operating as a Lyft vehicle and Lyft was effectively and constructively the named insured at the time. The court limited its published holding to Liberty Mutual’s obligation and declined to specifically address the Fund’s coverage obligations.
Key Takeaways
- New Jersey TNC liability policies must cover PIP medical benefits for uninsured pedestrians injured by a TNC driver during a prearranged ride.
- The TNC Act’s exclusivity language does not exempt insurers from the pedestrian-PIP mandate in N.J.S.A. 17:28-1.3.
- A policy that omits statutorily required pedestrian PIP coverage must be reformed to include it.
Why It Matters
This first-impression decision closes a potential coverage gap for uninsured pedestrians injured by rideshare vehicles. Such pedestrians may seek prompt, no-fault medical-expense benefits from the TNC’s insurer instead of waiting for liability litigation to conclude.
The ruling also clarifies that the TNC Act must be harmonized with New Jersey’s broader compulsory-insurance scheme. TNC insurers cannot treat the Act’s listed insurance requirements as displacing otherwise applicable statutory coverage mandates.