☂️📈 Maya Increases 2024 TLC Liability Premiums 15%+
Maya Assurance, third largest (non-captive) TLC liability insurer, is set to increase prices by 15%+. News comes on back of 8%+ increase by American Transit, the dominant TLC liability insurer
Maya Assurance, third largest non-captive TLC liability insurer, is increasing 2024 premiums by 15%+
American Transit, largest TLC liability insurer, already announced 8%+ premium increase for 2024
Insurance expense is a major cost for NYC TLC drivers & fleets and is following national trend in auto insurance market
In December, we reported that American Transit (ATIC), the largest NYC FHV (TLC) liability insurance provider with an over 50%+ market share, was set to increase premiums by 8% to 10%+ in 2024. We can now report Maya Assurance (MAC), the third largest (non-captive) TLC liability insurer with ~4% market share, is increasing its TLC liability premiums by 15%+ for many of its policyholders 👀.
Maya, unlike American Transit (ATIC) and Hereford (HIC), only seems to focus on individual TLC-licensed drivers over the age of 24 and does not underwrite corporate fleets (a/k/a FHV Corporations). In addition, based on our discussions with brokers and drivers, Maya is often used by TLC drivers when American Transit or Hereford are unwilling to underwrite a policy, which likely skews its TLC liability policies toward riskier drivers that require higher rates (Note: this is just our guess).
For reference, a captive insurance company (“captive”) is a sort of self-insurance structure that large fleets often use to insure their own vehicles. In plain English, the largest TLC leasing companies like American Lease, Tower, Buggy & Fast Track* have enough vehicles where they can create their own insurance companies for their fleets, to save money. Creating a captive or signing-up to be part of a captive insurance policy is generally not possible for most individual TLC-licensed drivers and small/mid-sized TLC fleets.
*These four companies are essentially three companies now, given a recent deal that effectively resulted in Buggy and Fast Track having the same corporate owner.
How Are We Estimating 15%+ Increase In Maya TLC Liability Insurance Premiums?
Based on our discussions with NYC TLC insurance brokers and TLC-licensed drivers, Maya has dropped the “Black Car Base” classification. This has resulted in Maya underwritten TLC liability policy premiums, like-for-like, increasing by 15%+. For example, if a driver’s 2023 annual premium was $5,000, for 2024 it will likely be above $5,700.
From our understanding, the Black Car Base classification was used for vehicles that did “traditional” black car base work (i.e., 5 to 6 trips a day). Although most TLC-plated vehicles have drivers that work for Uber/Lyft now, easily completing 10+ trips per day, the Black Car Base designation was used, resulting in a reduced insurance premiums.
The insurance designation that Maya is now using for many TLC-plated vehicles is “Car Service”. The Car Service classification is rate based on vehicles that are assumed to do for-hire vehicle trips more frequently, reflective of drivers who work on the large app platforms.
Are you insured with Maya? Please let us know how much your premium increased in the comments section below.
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Inflationary? Predatory?
Before drivers/fleets blame American Transit or Maya or captive insurance companies controlled by large leasing companies or TLC Chair David Do starts talking about “predatory” insurance companies, let’s take breath 😤 and recognize...auto insurance premiums nationally have gone up significantly. (As a side note, what major costs does Do think informs TLC vehicle lease rates?🤔)
In other words, this is not a NYC TLC-specific trend.
In fact, a popular article in the Wall Street Journal overviewed this dynamic only a few days ago.
“After Allstate suffered billions of dollars in losses and failed to get the rate increases it wanted, it resorted to the nuclear option.
The insurance giant threatened last fall to stop renewing auto insurance for customers in three states that hadn’t given in to its demands, which would have left those policyholders scrambling for coverage. The states blinked.
In December, New Jersey approved auto rate increases for Allstate averaging 17%, and New York, a 15% hike.”
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“Insurance premiums have outpaced inflation. Car insurance rates increased 19.2% in the 12 months through November, six times the rise in overall consumer prices, Labor Department data show.”
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- Wall Street Journal, ‘Buying Home and Auto Insurance Is Becoming Impossible’ by By Jean Eaglesham (Jan 8 2024, 12:01am ET)
However, increasing insurance rates in the NYC TLC market is still very notable because the absolute dollar amount of insurance premiums paid by TLC drivers & fleets is much higher than what the average New York State resident pays (non-commercial auto vs. commercial NYC for-hire auto).
A TLC driver or fleet usually paid between ~$4,000 (individual rate) to ~$6,500+ (fleet rate) annually in 2023 for a liability-only policy. Add another ~$2,000 to ~$4,000 to those rates for a comprehensive & collision policy. Therefore, full coverage insurance for a TLC driver or fleet might cost ~$6,000 to ~$10,000+ per year 🤑 (before any additional increase ☂️📈). This figure represents a significant part of a driver’s income and a fleet’s operating cost.
For comparison, according to Bankrate.com, New York State residents pay an average of $1,371 annually for minimum coverage and $3,139 annually for full coverage. Full coverage in New York is 56% higher than the national average of $2,014 and minimum coverage costs 120% more than the national average of $622.
Some factors driving general auto insurance increases, including TLC insurance, are:
Increased incidents of weather-related events, accidents and theft
Increasing cost of repair (more expensive technology in vehicles, parts, technician / mechanic shortages, increasing labor costs)
General inflation and supply chain dynamics (availability of parts, including microchips)
Used vehicle prices
“The Insurance Information Institute says auto insurers paid $1.12 in claims last year for every dollar they collected in premiums. This year, that ratio is expected to be $1.09.”
- NPR
Furthermore, the TLC insurance premium increases referenced in this article relate to liability-only policies, As we’ve written previously, premiums for comprehensive & collision policies are also increasing or simply not available on certain vehicles (expensive EVs in particular), which are seen as a bad or impractical risk to underwrite (i.e., would need to charge a TLC driver or fleet, a rate they can’t practically afford).
NYC TLC Insurance: 2024 Market Overview
To quickly recap, American Transit, the dominant player in the NYC for-hire transportation insurance market (50%+ market share), we believe, pushed through an 8%+ TLC liability premium increase for 2024 . Maya, the 3rd largest non-captive TLC liability insurer, has also increased rates by 15%+ for many policyholders.
This leaves Hereford & INSHUR, the last two major non-captive TLC liability insurers, most non-medallion TLC-licensed drivers (& fleets) can get their required TLC insurance from. We will keep our readers up to date as we continue to research any rate increases they might be pushing through.
For the last two years, we’ve published a NYC for-hire transportation (TLC) insurance industry overview. We will publish our 2024 Market Overview in mid to late January, ahead of the February insurance renewal period.
As always, let us know your thoughts in the comments section below or by emailing us at info@automarketplace.com.
AutoMarketplace NYC covers the for-hire transportation industry and automotive news. Check out AutoMarketplace on YouTube ▶️