New Jersey court says Lyft policies must cover uninsured pedestrians

A New Jersey appeals court says Lyft's insurer must cover an uninsured pedestrian's medical bills - coverage the policy left out. 

In a decision handed down on July 24, 2026, the Superior Court of New Jersey, Appellate Division, called it a question no state court had answered before: must a ride-share company's liability policy pay personal injury protection (PIP) benefits - no-fault coverage for medical costs - to an uninsured pedestrian hit by one of its drivers? The court said yes. 

The case started when a pedestrian was allegedly struck by a car whose driver was working for Lyft. The vehicle was covered by a Liberty Mutual Insurance Company (Liberty Mutual) "Business Auto" policy issued to Lyft. It carried liability coverage but no PIP benefits for uninsured pedestrians. 

Liberty Mutual denied the claim, arguing that the Transportation Network Company Safety and Regulatory Act (TNC Act) controls ride-share insurance and does not require pedestrian PIP coverage. The pedestrian then went to a state fund run by the New Jersey Property-Liability Insurance Guaranty Association (NJPLIGA), which denied him too, saying the ride-share car was not an "automobile" under the fund's statutes. 

The court sided with the pedestrian. It leaned on N.J.S.A. 17:28-1.3, which says "[e]very liability insurance policy issued in this State on a motor vehicle, exclusive of an automobile . . . shall provide [PIP] benefits . . . to pedestrians who sustain bodily injury in the State caused by the named insured's motor vehicle. . . ." 

A ride-share car, the court explained, is a "personal vehicle" that "shall not be considered an automobile . . . while a [TNC] driver is providing a prearranged ride" - so it lands squarely inside that rule. Nothing in the TNC Act cuts pedestrians out. The court noted the TNC Act does require "medical payments in the amount of at least $10,000," but said that money is for the driver, not injured pedestrians. 

Reading the law Liberty Mutual's way, the court warned, would leave uninsured pedestrians hit by ride-share cars with no PIP coverage at all - the very gap the no-fault system was meant to close. 

The court also rejected Liberty Mutual's backup argument that the driver, not Lyft, was the "named insured," finding Lyft was "effectively and constructively" the "named insured" while the driver was logged in and carrying a passenger. 

The bottom line: in New Jersey, a liability policy written for a ride-share company must include uninsured pedestrian PIP benefits, and courts can reform policies that leave the coverage out.