Insurance for Rideshares

“Ridesharing” has increasingly become a transportation option for people on the go. Unlike traditional taxis, this mode of transit allows people to use their own cars and their own time to pick people up. These drivers choose their own time to drive, and through the use of apps are able to pick up riders who select where they want to be picked up and where they want to go.

The rise in popularity of ridesharing has made it difficult for regulators to keep up and ensure that the companies that provide for this service are keeping their riders safe and that they are being held accountable for the actions of the drivers they employ. Legislation was heard to clarify insurance coverage for transportation network companies (TNC’s), such as Uber and Lyft.

The proposed legislation requires coverage in the three stages of the process; beginning when the TNC driver logs onto the TNC app, through the ride with the passenger, and ending when the driver logs off the app. This coverage would differ from taxis, in that taxis have commercial coverage at all times. This bill also clarifies terms of collision and underinsured/uninsured motorist coverage. In addition, the bill aims to offer clarity and guidelines for TNC’s and participating drivers. Some of the other key proposals of this bill are:

  • The TNC and participating driver are required to maintain a plan of transportation network financial responsibility that meets the requirements of the bill, either individually or in combination.
  • The TNC is required to provide the participating driver with the details of the transportation network financial responsibility plan, the limits of liability, and how the driver’s plan may not provide coverage in connection with the TNC’s activities.
  • This insurance must not require any other insurance to first deny the claim or have the participating driver’s insurance be the first to deny the claim to trigger coverage.

STATUS: The bill is in the Judiciary Committee. (S.F. 1679)

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