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Committee advances bill to clarify rideshare companies' liability for uninsured/underinsured motorists
Summary
SB 371 would make transportation network companies (TNCs) solely responsible for uninsured/underinsured motorist (UIM) coverage; proponents said current UIM requirements inflate ride costs, opponents urged data transparency and consumer protections. The committee advanced the bill as amended to Appropriations.
The Senate Transportation Committee advanced SB 371 by Senator Cabaldon after a hearing that drew representatives from Uber and Lyft, consumer advocates, and business groups.
SB 371 would remove the statutory requirement that drivers obtain $1,000,000 in uninsured and underinsured motorist (UIM) coverage and instead place that responsibility squarely on transportation network companies (TNCs). John Finley, representing Uber Technologies Inc., told the committee that current California law uniquely requires this level of UIM coverage only from TNCs and that the coverage contributes a large share of fares in California. "In Los Angeles today, 45% of a rideshare fare is now going to pay for insurance," he said, arguing SB 371 would clarify that drivers are not obligated to purchase UIM themselves.
Malcolm McFarland of Lyft testified in support and said the sector’s insurance costs have increased and the existing limits were set in the industry’s infancy. He told the committee the bill would begin a data‑driven conversation about modernizing insurance requirements without sacrificing protections.
Consumer Attorneys of California and other consumer and safety groups testified in opposition. Sabina Tucker said the current UIM requirement protects passengers and drivers when they are hit by uninsured or underinsured motorists and warned there is insufficient publicly available data—on accident rates and claim amounts—to justify reducing coverage levels. The Consumer Federation of California and Consumer Watchdog also urged a no vote, citing the same transparency concerns.
Senate staff and the author described amendment language intended to address data questions; Cabaldon and committee members said they were committed to continuing negotiations. Senator Richardson moved the measure. The committee vote to advance SB 371 as amended to the Committee on Appropriations was recorded 13–0; the committee left the bill on call for absent members.
The hearing highlighted a key substantive split: TNCs and many business and civic groups argued the UIM requirement uniquely burdens TNC fares and drivers in California, while consumer advocates urged maintaining robust protections until independent data justify changes. The bill now proceeds to Appropriations for further review, and stakeholders indicated additional data and potential amendments will be pursued.
