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News & Markets California Legislator Introduces Ridesharing Bill
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The personal automobile insurance polCalifornia Assemblywoman introicy is not designed or intended to be used duced a bill in late April to regulate for commercial activities and contains a ridesharing companies like Uber, Lyft and specific exclusion for livery activities, the Sidecar. insurance industry and the bill’s author Assembly Bill 2293, authored by argue. Assemblywoman “As this new transportaSusan Bonilla, ‘As this new transporD-Concord, would tation option has grown tion option has grown and expanded, gaps in insurclarify existing insurand expanded, gaps in ance coverage have been ance laws related to insurance coverage have identified,” Bonilla said in ridesharing service a statement. “My legislaactivities while supbeen identified.’ tion will define when comporting new business mercial activity begins and ends along with advancements, according to Bonilla. providing important disclosures to TNC The transportation network company drivers which will ensure that all parties business model allows drivers to use their are aware of the insurance policy coverage personal vehicles to pick up and drive ridwhich is in place.” ers for a fee using a smartphone app, which California Insurance Commissioner the insurance industry has argued is using a Dave Jones in early April recommended to personal vehicle for a commercial activity.
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the California Public Utilities Commission, which oversees TNCs in California, that TNCs should bear the insurance burden when they encourage drivers to use their Susan Bonilla personal vehicles to transport passengers for a profit. TNCs have become a high profile topic in the last few months, in part thanks to a perceived gap in insurance coverage, and a New Year’s Eve incident during which a TNC driver under contract with Uber struck and killed 6-year-old Sofia Liu. Her family has filed a lawsuit against Uber. Uber issued a statement saying the driver, 57-year-old Syed Muzzafar, was not responding to a fare and didn’t have a passenger in his car when he struck Liu. The sticking point in the debate between TNCs and the insurance industry has been over a gap in insurance coverage during the period when TNC drivers have their smartphone app on but have not been matched with a ride. TNCs were already required to have a $1 million commercial policy on drivers when giving rides or going to pick up a ride, but it was assumed that during this gap that TNC drivers’ personal policies would be in effect. AB 2293 would: • Require TNCs to disclose to drivers upfront that their personal insurance may not apply when engaging in commercial TNC activities; • Define in statute that TNC activities begin once the “app” is turned on and the TNC services end when the “app” is turned off; • Clarify that the TNC business company insurance is the primary insurance coverage; • Require TNCs’ liability insurance to defend their drivers when the driver has a claim or accident. www.insurancejournal.com