Rideshare companies must provide their drivers with insurance. That was the gist of a public letter released today from the California Insurance Commission, addressed to the California Public Utilities Commission, which regulates transportation network companies such as Uber, Lyft, and Sidecar.
“While smart phone technology is bringing new business opportunities to the marketplace and new transportation choices for consumers, our investigative hearing revealed serious insurance gaps in the current business model of Transportation Network Companies such as Uber, Lyft and Sidecar,” Insurance Commissioner David Jones wrote in a statement to press. “As long as TNCs are encouraging non-professional drivers to use their personal vehicles to drive passengers for a profit, a risk which personal automobile insurance simply does not cover, TNCs should bear the burden of making sure that insurance is provided. Our recommendations will ensure there is insurance protection for passengers, drivers and pedestrians.”
Whether the TNCs should provide insurance has been the subject of intense debate in state and local governments over the past year. The recommendations to the CPUC come specifically out of a hearing on TNC insurance that Dave Jones, the insurance commissioner, held March 21. The Guardian also wrote an editorial, “Sharing economy should share its wealth,” calling for rideshares to provide insurance, not only because it’s unfair competition (insurance costs money to provide, a burden taxi companies carry but not TNCs), but because people and TNC drivers in accidents were left for broke, lacking inadequate insurance.
A taxi driver-led protest calling for the CPUC to require TNC companies to provide insurance is starting at noon, today. Below we’ll embed the insurance commissioner’s letter to the CPUC.
[Update 4/10: Visit our story on the taxi driver-led protest, here.]