Q&A
Council Member De La Rosa questions Commissioner Do on taxi insurance regulation and fraud
0:59:59
ยท
3 min
Council Member Carmen N. De La Rosa questions TLC Commissioner David Do about the city's legal powers in regulating insurance for taxi and for-hire vehicles, the susceptibility of PIP insurance to fraud, and the crisis in the New York PIP system. Commissioner Do explains the division of regulatory powers between state and city, discusses fraud mitigation efforts, and highlights the unique nature of New York City's for-hire vehicle market.
- The city can make insurance regulations more stringent than state requirements
- The state Department of Financial Services plays a key role in enforcement and policy changes
- Commissioner Do emphasizes the professionalized nature of NYC's driving force compared to other cities
Carmen N. De La Rosa
0:59:59
Thank you, chair.
1:00:01
Commissioner, what legal powers does the city have in regulating the insurance market for taxi and for taxi drivers and for hire vehicles?
David Do
1:00:09
Yeah.
1:00:10
So, most regulations are left to the state level, but, the TLC provides, can always make it a little bit more stringent.
1:00:19
And in this case, we made it more stringent, to go well, a TLC before me, made it more stringent, in the nineteen nineties from 50,000 to 200,000 in, additional PIP.
Carmen N. De La Rosa
1:00:33
PIP insurance is often cited as being more susceptible to fraud than other types of insurance.
1:00:38
Can you explain if that is the case in your experience and why?
1:00:43
And what steps has the city taken to mitigate this risk?
David Do
1:00:47
Yeah.
1:00:48
I think overall, again, the enforcement mechanisms are, with the state DFS, which is the Department of Financial Services run by, Superintendent Harris.
1:00:59
She has done an amazing job, at, not only gathering stakeholders like yourself, but looking at an overall policy that would get us to a better place with the American Transit Insurance Company.
1:01:12
She recently proposed three proposals within the state budget that provides, some of that, I I guess, some of the the changes necessary, to get to a better, place.
1:01:26
And so we support that.
1:01:27
I I think if you can repeat your specific question one more time, councilor.
Carmen N. De La Rosa
1:01:31
My question is, what has the city what steps has the city taken to mitigate the risk of fraud?
David Do
1:01:38
Yep.
1:01:38
So in addition to that, I think to to reverse the question a little bit, when I talk to stakeholders, right, what they have told me, is that, really, you know, those who are operating in these fraudulent enterprises, right, even if the PIP went from 200 to 50,000, 1, recent, article in Insurance Insider stated that, they would just cause more crashes to reach the profit margins that they need, from even if PIP went from 200,000 to 50,000.
Carmen N. De La Rosa
1:02:14
Okay.
1:02:15
I look forward to speaking more about that.
1:02:17
Chair, I have one more question.
1:02:19
That's okay.
1:02:20
The New York PIP system is in crisis with over 70% of the market covered by insolvent companies.
1:02:26
Approximately half of the of the country doesn't have no fault system for for hire vehicles.
1:02:32
Are there any of these states that don't have no fault facing a crisis of in their insurance systems to your knowledge?
David Do
1:02:40
Again, I'm not an insurance regulator.
1:02:42
I'm a, for hire market, regulator, but I think where we need to look at the differences, right, is that New York City is a whole different, creature, than any other city, any other state, in the country.
1:03:00
We have a more professionalized driving force that operates, full time, thirty two plus hours a week.
1:03:07
Many other cities, especially outside of New York City, really operate in a different manner.
1:03:14
They operate as gig workers part time.
1:03:17
And so that's why we have so many different regulations to protect drivers in New York City.
1:03:24
For example, minimum driver pay.