On Thursday, April 2nd, Senate Bill 117, which establishes insurance and safety requirements for the rapidly-growing app based transportation service industry, passed in the Kansas House of Representatives 107-15 and in the Kansas Senate 35-2. Three Senators abstained from voting on the measure. S.B. 117 is now headed to Kansas Governor Sam Brownback, whose signature would make Kansas the sixth state to enact state laws governing transportation network service companies, also known as TNCs.
“We applaud the fact that state lawmakers overwhelmingly recognized that Kansans who sign up to drive for TNCs, such as Uber and Lyft, need to be properly insured in all phases of this activity,” states Chuck Stones, President/CEO of the Kansas Bankers Association. Stones adds, “A report issued last week by the National Association of Insurance Commissioners (NAIC) confirmed our concern that gaps exists in insurance coverage for TNC drivers.” The NAIC report specifically states that “regulators and legislators can resolve risk exposure concerns by putting laws into place that require specific insurance coverage for TNC’s and TNC drivers and eliminate insurance gaps.” The report also states, “TNC laws should clearly define the terminology and identify the insurance coverage and limits required during each period.”
The Kansas Bankers Association, which represents 99% of the commercial banks operating across Kansas, became involved in this issue when its leadership realized there were more than 500 TNC drivers operating in the Sunflower State without comprehensive and collision insurance for all phases of this activity. S.B. 117 will protect Kansans that drive for these companies and it will also protect lienholders that have financed any of the vehicles being used for this service, because it will simply ensure there is insurance in place to repair or replace these vehicles if they are damaged or destroyed in an accident.
In addition to clarifying insurance requirements, S.B. 117 also requires TNCs to implement zero tolerance policies for their drivers on the use of drugs and alcohol, and will subject TNC drivers in Kansas to local and national criminal background checks conducted by the Kansas Bureau of Investigation. Kansas is one of 35 states that have TNC consumer and public safety legislation currently pending.
For more information regarding S.B. 117 contact Doug Wareham, EVP - Government Relations at (785) 220-5820 or at [email protected]