New Jersey Insurers Do Not Have to Provide Statutory UM/UIM Coverage to Injured Uber Eats Driver


In Malzberg v. Josey, 473 N.J. Super. 537 (App. Div. 2022), the Superior Court of New Jersey Appellate Division issued a published opinion finding that an insurer is not obligated to provide underinsured motorist coverage to an injured Uber Eats driver holding that insurance coverage requirements under the state's Transportation Network Company Safety and Regulatory Act (TNCSRA or Act), §§ N.J.S.A. 39:5H, do not apply to food delivery services. The TNCSRA requires “transportation network companies” to provide at least $1.5 million in underinsured motorist coverage. Judge Petrillo held that the Act applies only to the pre-arranged transport of persons and not to the delivery of food. The case presented a question of first impression regarding the scope of the TNCSRA. 

The case arose after an Uber Eats driver was injured while operating his motorcycle during a delivery. The defendant, Portier, LLC, enrolled plaintiff, Scott Malzberg (Malzberg), to use his personal vehicle (motorcycle) to deliver food. Portier generated leads via a mobile phone application known as Uber Eats, which connects restaurants and food delivery service providers. 

On August 17, 2017, Malzberg was injured while in the process of making a food delivery for Uber Eats when a vehicle driven by defendant Caren Josey (Josey) collided with his motorcycle. Malzberg enrolled with defendant Portier, LLC (Portier) to use his personal vehicle - a motorcycle - to deliver food. Portier had procured a business auto insurance policy from James River Insurance Company (James River). The injuries exceeded the limits of Josey's policy and Malzberg filed an action seeking to recover for underinsured motorist coverage. The trial court, however, granted summary judgment in favor of James River dismissing Malzberg's claim for underinsured motorist coverage, finding that that the TNCSRA only regulated companies that use a digital network such as a mobile phone application (app) to connect a "rider" to a "prearranged ride."

On appeal, Malzberg contended that there was a "hole in the law created by the constant evolution of technology" that raised policy considerations beyond the court's purview and that food delivery drivers should be afforded the same protection as those transporting passengers, since the risk of accident and injury are the same. The Appellate Division disagreed after reviewing the plain language set forth in the TNCSRA to determine the scope of the statute’s intended reach. Indeed, upon examining the plain and ordinary meaning of the Act’s definitions, the court held that nothing in the definitions section or any other section of the Act referred to the delivery of food, and thus did not apply to app-based food delivery services. Rather, the court looked at the plain meaning of the terms “transportation network driver” and “prearranged ride” to conclude that the Act only regulated companies that use a digital network such as a mobile phone application to connect a “rider” to a “prearranged ride,” and that nothing in the statutory text or legislative history of the TNCSRA suggested that the Legislature intended to regulate app-based food delivery services. 

Comment: As the law stands today, the provisions of this Act will only apply to transportation network companies engaged in the transport of human passengers, and not to food or any other goods. In January 2022, however, legislation (S-486/A-3596) was introduced in the New Jersey Legislature that would address the insurance coverage requirements for a food delivery network company. The proposed legislation would require delivery network companies to provide at least $1.5 million in liability coverage as well as $1.5 in UM/UIM benefits when a driver is providing a prearranged delivery, which would close the “hole in the law” as asserted by Malzberg. Until the new legislation is passed, however, claims professionals should be focused on obtaining all facts related to these types of claims to determine what service, if any, was being provided by those seeking UIM/UM coverage. 

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