Uber-rich transportation firms should be liable for death or injury


Update 8/27: The Consumer Federation of California (CFC) today removed its support for Assembly Bill 2293 (Bonilla) due to changes in the insurance coverage proposed for transportation network companies (TNCs).

“An earlier version of AB 2293 which CFC supported mandated TNC coverage of one million dollars per [incident]. In the current version, AB 2293 requires a meagre $50,000 per person and $100,000 per incident for death or injury, and $30,000 for property damage. The bill allows wealthy TNCs to put this burden on the backs of their drivers. It only obligates TNCs to provide excess liability coverage of $200,000 per incident,” CFC objected in a floor alert distributed to legislators today. “These amounts are entirely inadequate to compensate for injury or death caused in the course of business by a transportation company.”

UPDATE 7/11: The California Public Utilities Commission’s president sharply reduced his proposed insurance coverage requirements for Transportation Network Companies (TNCs) shortly before Thursday’s CPUC meeting, prompting a delay in action on the issue until August.

Commission President Michael Peevey’s new proposal calls for a minimum of $100,000 comprehensive commercial liability coverage when a TNC driver is “app on” – cruising with an Uber, Lyft or other smartphone app turned on to signal availability to pick up fares. A month earlier, he’d proposed a million-dollar minimum (see below).

The commission rescheduled the issue for its Aug. 14 meeting.

JULY 2 – The rise of Transportation Network Companies (TNCs) such as Uber and Lyft, providing services similar to taxicabs but without the same protections, has opened a dangerous gap in public safety and security.

This was tragically demonstrated on New Year’s Eve last year, when an Uber driver roaming the San Francisco streets waiting to be summoned for a fare plowed into a young family that was crossing the street. Six-year-old Sofia Liu was killed. Her mother and brother were severely injured. Community fundraisers were required to cover the burial costs, and her family is burdened with medical bills along with their grief. Read more here.

But because there was no passenger in the vehicle, Uber insists it isn’t liable for the accident. Instead, Uber – a corporation worth $18.2 billion – is attempting to foist all responsibility onto the driver, whose personal auto insurance coverage limits are a tiny fraction of the insurance requirements for commercial drivers. Uber is relying in part on a California Public Utilities Commission (CPUC) regulation adopted in September 2013 that sowed confusion about exactly when commercial insurance requirements kick in for the emerging TNC market.

On July 10, the CPUC will consider a proposal to clarify the 2013 regulation. It would impose a million-dollar commercial insurance coverage requirement on a TNC as soon as a driver opens the computer “app” to signal readiness to pick up paying passengers – “app on,” as it’s called – and the requirement would remain in force until “app off,” when the driver is no longer available for hire. Uber and other TNCs are hiring lobbyists to oppose this regulation, arguing that they are mere bystanders in a new “peer to peer” business model, all the while pocketing billions from investors and collecting big fees for their hook-up services.

The CPUC could act on the proposed Modification of Decision 13-09-045 as soon as its July 10 meeting. 

 Photo:  Mike Koozmin / San Francisco Examiner



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