Progressive dodges arbitration after court rules Lyft vehicle wasn’t covered under its SUM policy due to New York City’s for-hire vehicle classification.
On July 9, 2025, New York’s Appellate Division, Second Department handed Progressive Insurance a clear win, ruling that the insurer had no obligation to arbitrate a claim for supplementary underinsured motorist (SUM) benefits brought by a Lyft passenger. The court found that the Lyft vehicle didn’t meet the policy’s definition of a covered vehicle, based on how New York City classifies for-hire transportation.
The case started with a January 2023 accident in Queens. Katherine Bruton was riding as a passenger in a vehicle owned and operated by Salimjon Primatov, who was working as a driver for Lyft at the time. Bruton filed a claim for SUM benefits under a policy that covered Lyft drivers and was issued by Progressive.
Progressive denied the claim, saying Bruton wasn’t entitled to coverage. When she demanded arbitration, Progressive responded by filing a petition to stop the process entirely. The trial court refused to grant that request - but the appellate court saw things differently.
At the center of the dispute was how the policy defined a “transportation network company vehicle.” To qualify for SUM coverage, the vehicle involved had to fall under that category. But the policy also made a key exception: any vehicle that qualified as a “for-hire vehicle,” as defined by New York City law, wasn’t considered a TNC vehicle.
According to the city’s administrative code, a for-hire vehicle includes any car carrying passengers for pay in the five boroughs. Since Primatov was driving for Lyft and had a paying passenger – Bruton - when the crash happened, the court held that his car fit the city’s definition of a for-hire vehicle. And because of that, it didn’t meet the policy’s definition of a TNC vehicle.
That meant Bruton wasn’t considered an insured under the policy. And without that status, she couldn’t demand arbitration.
The appellate court reversed the lower court’s ruling and granted Progressive’s request to permanently stay the arbitration. It leaned on earlier cases, including Progressive v. Callahan and Progressive v. Baby, which involved similar policy language and similar results - no coverage for passengers in ride-share vehicles classified as for-hire under city rules.
Bruton tried to raise another argument on appeal, but because it wasn’t brought up in the trial court, the judges declined to consider it.
For insurers, the decision is a reminder of how local laws can shape the boundaries of coverage, especially in the fast-evolving world of ride-share and urban transport.
