When they first began operating, Uber and Lyft failed to carry adequate insurance coverage for their drivers and were not governed by basic safety regulations applicable to other types of paid transportation networks, such as taxis. Under the law, Uber, Lyft and other such application based carriers are called Transportation Network Carriers — “TNCs.”
Then, on New Year’s Eve 2013, 6-year-old Sophia Liu was struck and killed by an Uber driver in San Francisco. Sophia was walking in a crosswalk with her mother and brother. The Uber driver was allegedly looking at the Uber app on his cellphone, while logged into the app, but before he had accepted a passenger. I represented Sophia’s family in the first wrongful death lawsuit brought against a TNC. Her tragic death played a central role in shaping the debate, in California and nationwide, over whether TNC companies were responsible for injuries and deaths caused by their drivers.
As a result, Assemblymember Susan Bonilla introduced Assembly Bill 2293, which the Consumer Attorneys of California and I helped navigate through the legislature. The Liu family came to Sacramento and provided moving testimony calling upon the government to require that TNC companies carry insurance. Ultimately Gov. Jerry Brown signed the first of its kind legislation in the U.S. requiring TNC companies to carry liability insurance. The law, codified in California Vehicle Code Section 5430, mandates that TNC companies must carry $1 million in liability coverage for their drivers.
Many people have asked how the law actually works. Below, I address the most commonly asked questions.
First situation: I was a passenger in a TNC car and injured in an accident caused by the TNC driver. Can I sue the driver? Can I sue the TNC, such as Uber or Lyft?
You may bring a case against both the driver and the TNC company. Keep in mind, though, even if the TNC driver was at fault and owns an auto insurance policy, he or she may have no assets to pay for your damages. Since the passage of AB 2293, personal auto policies do not provide coverage for drivers engaged in commercial operations such as carrying passengers in exchange for compensation.
This is why the $1 million in insurance coverage TNC’s must carry for death, personal injury and property damage caused by their drivers is so important. The $1 million in insurance covers claims arising from the moment the driver accepts a ride request on the TNC app to when the driver completes the transaction on the app or until the ride is complete, whichever is later.
Second situation: I was a TNC passenger and injured in an accident. The collision was the fault of the other driver, not the TNC driver. The other driver has no car insurance. What can I do?
TNC passengers can make a claim against the TNC company’s insurance, even when the collision was caused by another driver who lacked insurance or had a bare bones policy.
This type of insurance is called uninsured and underinsured motorist coverage. Vehicle Code Section 5430 requires that TNC companies carry $1 million in uninsured and underinsured motorist coverage for passengers. The coverage applies from the moment a passenger enters the TNC until the passenger exits the vehicle or the transaction is complete, whichever comes later.
Third situation: I was injured by an accident caused by a TNC driver, but I was not a passenger in the car. Can I still sue the TNC company/driver to obtain compensation for my injuries?
Yes, you may file a lawsuit against the TNC company/driver and thereby get access to their insurance. I have represented bicyclists, pedestrians and occupants of other vehicles struck by negligently operated Uber and Lyft vehicles. If the accident occurs between the time that the TNC driver logs on, but before a ride is accepted, the TNC insurance is limited to $250,000 per person and $300,000 per occurrence (meaning for all injuries caused to all parties injured by the driver’s negligence.) If the TNC operator has accepted a ride request and is either on route to collect the passenger, or is transporting a passenger, then there is $1 million in coverage.
Please note, the preceding answers are intended to provide general information on the law regarding TNCs legal insurance requirements. Every accident can raise its own facts and legal questions. If you are injured by a TNC, contact a lawyer with experience handling these cases.