California Commissioner Dave Jones made his initial recommendations to the California Public Utilities Commission on Tuesday following the California Department of Insurance’s investigatory hearing on March 21 relating to insurance issues and transportation network companies.
Jones made his recommendation public in an announcement sent out on Tuesday evening on the West Coast. CPUC over sees TNCs in California.
App-based rideshare operators and the insurance industry squared off at the public hearing, which included testimony from TNC representatives, the insurance industry and other stakeholders. Representatives from Uber, Lyft, Sidecar and other TNCs made an argument against more regulation of their emerging industry.
(AP Photo)
TNCs have become a hot topic, in part thanks to a perceived gap in insurance coverage, and an incident during which a TNC driver under contract with Uber struck and killed 6-year-old Sofia Liu.
Since then several states and local governments have been working on rules and regulations to oversee these emerging TNCs.
A big point of contention has been over the period when a TNC driver has an app on, but isn’t on the way to pick up a fare or doesn’t have a passenger. The insurance industry has argued personal insurance shouldn’t be left to pay for what is considered a livery service and therefore an exclusion in most personal auto policies.
Jones’ initial recommendations include:
- The CPUC should refine the definition of “when providing TNC services” to cover the “app on, no match” period and require the $1 million commercial liability policy to apply during this period. There appears to be a significant insurance gap for drivers, pedestrians and third parties that are involved in an accident with TNC-related vehicles during this period.
- TNCs should also be required to carry a minimum of $1 million uninsured/underinsured motorist coverage and a minimum of $50,000/$100,000 comprehensive and collision coverage, if the driver has purchased this coverage on his or her own policy. Drivers who use their personal vehicles for a TNC purpose run a strong possibility of having claims denied by their personal automobile insurance company because the driver used the car for a commercial or livery purpose.
The department will continue to review the testimony and other documents from the hearing and may have additional recommendations in the future.
Topics California Market
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