AB 2293, as amended, Bonilla. Transportation network companies: insurance coverage.
Existing law, the Passenger Charter-party Carriers’ Act, provides for the regulation of charter-party carriers of passengers by the Public Utilities Commission, and makes it unlawful for a charter-party carrier to operate without first obtaining a permit or certificate, from the commission, except as specified. The act requires a charter-party carrier to, among other things, comply with specified vehicle identification and accident liability protection requirements. A violation of the act is generally a misdemeanor, punishable by a specified fine or term of imprisonment, or both, depending on the violation.
This bill would amend the Passenger Charter-party Carriers’ Act to enact specified requirements for liability insurance coverage for transportation network companies, as defined, and their participating drivers. These requirements would
become operative on July 1, 2015. The bill would describe 2 distinct time periods and would specify the insurance requirements for each of those time periods and alternative methods of compliance with those requirements. The bill would require uninsured and underinsured motorist coverage to be provided for specified time periods. The bill would, in the event a driver’s insurance policy ceases to exist or has been canceled, or under certain other circumstances, require a transportation network company’s insurance policy to provide the required coverage.
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bill, beginning on July 1, 2015, would provide that a participating driver’s or vehicle owner’s personal automobile insurance policy does not provide coverage to the participating driver, vehicle owner, or any 3rd party unless the policy so provides. The bill, beginning on July 1, 2015, would require certain written disclosures by transportation network companies to their participating drivers on the insurance coverage provided by the company and to advise that the driver’s personal automobile insurance policy will not provide coverage. The bill would require participating drivers to carry proof of insurance coverage, as specified. The bill would require the commission and the Department of Insurance to collaborate on a study of transportation network company insurance, as specified, and would prohibit a transportation network company from disclosing the personally identifiable information of a passenger, except as specified. The bill would specify the Legislature’s intent relating to expediting the approval of transportation network company insurance products, and would set forth related legislative findings and declarations.
Because a violation of the bill’s provisions would be a crime, the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
Article 7 (commencing with Section 5430) is
2added to Chapter 8 of Division 2 of the Public Utilities Code, to
Notwithstanding any other provision of this chapter, this
8article shall apply to transportation network companies.
(a) As used in this article, a “transportation network
10company” is an organization, including, but not limited to, a
11corporation, limited liability company, partnership, sole proprietor,
12or any other entity, operating in California that
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13 prearranged transportation services for compensation using an
14online-enabled application or platform to connect passengers with
15drivers using a vehicle.
16(b) As used in this article, “participating driver” or “driver” is
17any person who uses a vehicle in connection with a transportation
18network company’s online-enabled application or platform to
19connect with passengers.
20(c) As used in this article, “transportation network company
21insurance” is a liability insurance policy that specifically covers
22liabilities arising from a driver’s use of a vehicle in connection
23with a transportation network company’s online-enabled
24application or platform.
(a) A transportation network company shall disclose in
26writing to participating drivers, as part of its agreement with those
27drivers, the insurance coverage and limits of liability that the
28transportation network company provides
begin delete becauseend delete the driver
29 uses a vehicle in connection with a transportation network
30company’s online-enabled application or platform, and shall advise
31a participating driver in writing that the driver’s personal
32automobile insurance policy will not provide coverage
begin delete whileend delete
33 the driver uses a vehicle in connection with a
34transportation network company’s online-enabled application or
P4 1(b) A transportation network company shall also disclose in
2writing to participating drivers, as part of its agreement with those
3drivers, that the driver’s personal automobile insurance policy will
4not provide collision or comprehensive coverage for damage to
5the vehicle used by the driver from the moment the driver logs on
6to the transportation network company’s online-enabled application
7or platform to the moment the driver logs off the transportation
8network company’s online-enabled application or platform.
9(c) This section shall become operative on July 1, 2015.
(a) A transportation network company and any
11participating driver shall maintain transportation network company
12insurance as provided in this section.
13(b) The following requirements shall apply to transportation
14network company insurance from the moment a participating driver
15accepts a ride request on the transportation network company’s
16online-enabled application or platform until the driver completes
17the transaction on the online-enabled application or platform or
18until the ride is complete, whichever is later:
19(1) Transportation network company insurance shall be primary
20and in the amount of one million dollars ($1,000,000) for death,
21personal injury, and property damage. The requirements for the
22coverage required by this subdivision may be satisfied by any of
24(A) Transportation network company insurance maintained by
25a participating driver.
26(B) Transportation network company insurance maintained by
27a transportation network company.
28(C) Any combination of subparagraphs (A) and (B).
29(2) Transportation network company insurance coverage
30provided under this subdivision shall also provide for uninsured
31motorist coverage and underinsured motorist coverage in the
32amount of one million dollars ($1,000,000) from the moment a
33passenger enters the vehicle of a participating driver until the
34passenger exits the vehicle. The policy may also provide this
35coverage during any other time period, if requested by a
36 participating driver relative to insurance maintained by the driver.
37(3) The insurer, in the case of insurance coverage provided
38under this subdivision, shall have the duty to defend and indemnify
7(c) The following requirements shall apply to transportation
8network company insurance from the moment a participating driver
9logs on to the transportation network company’s online-enabled
10application or platform until the driver accepts a request to transport
11a passenger, and from the moment the driver completes the
12transaction on the online-enabled application or platform or until
13the ride is complete, whichever is later, until the driver either
14accepts another ride request on the online-enabled application or
15platform or logs off the online-enabled application or platform:
16(1) Transportation network company insurance shall, be primary
17and in the amount of at least
begin delete one hundredend delete thousand dollars
begin delete ($100,000)end delete for death and personal injury per person,
begin delete threeend delete hundred thousand dollars begin delete ($300,000)end delete for
20death and personal injury per incident, and
begin delete fifty thousand dollars for property damage.
22The requirements for the coverage required by this paragraph may
23be satisfied by any of the following:
24(A) Transportation network company insurance maintained by
25a participating driver.
26(B) Transportation network company insurance maintained by
27a transportation network company that provides coverage in the
28event a participating driver’s insurance policy under subparagraph
29(A) has ceased to exist or has been canceled, the participating
30driver does not otherwise maintain transportation network company
31insurance pursuant to this subdivision.
32(C) Any combination of subparagraphs (A) and (B).
33(2) A transportation network company shall also maintain
34insurance coverage that provides excess coverage of
begin delete one million per occurrence to cover any liability arising from a
35dollars ($1,000,000) in totalend delete
37participating driver using a vehicle in connection with a
38transportation network company’s online-enabled application or
39platform within the time periods specified in this subdivision,
P6 1which liability exceeds the required coverage limits in paragraph
3(3) The insurer providing insurance coverage under this
4subdivision shall be the only insurer having the duty to defend any
5liability claim arising from an accident occurring within the time
6periods specified in this subdivision.
13(d) Coverage under a transportation network company insurance
14policy shall not be dependent on a personal automobile insurance
15policy first denying a claim nor shall a personal automobile
16insurance policy be required to first deny a claim.
17(e) In every instance where transportation network company
18insurance maintained by a participating driver to fulfill the
19insurance obligations of this section has lapsed or ceased to exist,
20the transportation network company shall provide the coverage
21required by this section beginning with the first dollar of a claim.
22(f) This article shall not limit the liability of a transportation
23network company arising out of an automobile accident involving
24a participating driver in any action for damages against a
25transportation network company for an amount above the required
27(g) This section shall become operative on July 1, 2015.
(a) Nothing in this section shall be construed to require
29a private passenger automobile insurance policy to provide primary
30or excess coverage during the period of time from the moment a
31participating driver in a transportation network company logs on
32to the transportation network company’s online-enabled application
33or platform until the driver logs off the online-enabled application
34or platform or the passenger exits the vehicle, whichever is later.
35(b) During the period of time from the moment a participating
36driver in a transportation network company logs on to the
37transportation network company’s online-enabled application or
38platform until the driver logs off the online-enabled application or
39platform or the passenger exits the vehicle, whichever is later, all
40of the following shall apply:
P7 1(1) The participating driver’s or the vehicle owner’s personal
2automobile insurance policy shall not provide any coverage to the
3participating driver, vehicle owner, or any third party, unless the
4policy expressly provides for that coverage during the period of
5time to which this subdivision is applicable, with or without a
6separate charge, or the policy contains an amendment or
7endorsement to provide that coverage, for which a separately stated
8premium is charged.
9(2) For the purposes of this article only, the vehicle used by the
10participating driver shall be considered a public or livery
11conveyance and shall be considered as providing delivery of
12persons or passengers for compensation or a fee.
14 The participating driver’s or the vehicle owner’s personal
15 automobile insurance policy shall not have the duty to defend or
16indemnify for the driver’s activities in connection with the
17transportation network company, unless the policy expressly
18provides otherwise for the period of time to which this subdivision
19is applicable, with or without a separate charge, or the policy
20contains an amendment or endorsement to provide that coverage,
21for which a separately stated premium is charged.
35 This section shall become operative on July 1, 2015.
In a claims coverage investigation, a transportation
37network company or its insurer shall cooperate with insurers that
38are involved in the claims coverage investigation to facilitate the
39exchange of information, including the provision of dates and
P8 1times at which an accident occurred that involved a participating
The commission and the Department of Insurance shall
4collaborate on a study of transportation network company insurance
5to assess whether coverage requirements are appropriate to the
6risk of transportation network company services in order to
7promote data-driven decisions on insurance requirements, and
8shall report the findings of this study to the Legislature no later
9than December 31, 2017.
A transportation network company shall not disclose to
11a third party any personally identifiable information of a
12transportation network company passenger unless one of the
14(1) The customer knowingly consents.
15(2) Pursuant to a legal obligation.
16(3) The disclosure is to the commission in order to investigate
17a complaint filed with the commission against a transportation
18network company or a participating driver and the commission
19treats the information under confidentiality protections.
It is the intent of the Legislature that the Department of
21Insurance expedite review of any application for approval of
22transportation network company insurance products, and that these
23products become available for purchase on or before July 1, 2015.
Transportation network company insurance that meets
25the requirements of Section 5433 shall be deemed to satisfy the
26 financial responsibility requirements of Sections 16054 and 16056
27of the Vehicle Code.
The Legislature makes the following findings:
29(a) The commission has initiated regulation of transportation
30network companies as a new category of charter-party carriers and
31continues to develop appropriate regulations for this new service.
32(b) Given the rapidly evolving transportation network company
33service, it is the intent of the Legislature to continue ongoing
34oversight of the commission’s regulation of these services in order
35to enact legislation to adjust commission authority and impose
36specific requirements or prohibitions as deemed necessary as these
The Legislature does not intend, and nothing in this
39article shall be construed, to prohibit the commission from
40exercising its rulemaking authority in a manner consistent with
P9 1this article, or to prohibit enforcement activities related to
2transportation network companies.
A participating driver of a transportation network
4company shall carry proof of transportation network company
5insurance coverage with him or her at all times during his or her
6use of a vehicle in connection with a transportation network
7company’s online-enabled application or platform. In the event of
8an accident, a participating driver shall provide this insurance
9coverage information to any other party involved in the accident,
10and to a police officer, upon request.
Notwithstanding Section 11580.9 of the Insurance Code,
12or any other law affecting whether one or more policies of
13insurance that may apply with respect to an occurrence is primary
14or excess, this article determines the obligations under insurance
15policies issued to transportation network companies and, if
16applicable, drivers using a vehicle in connection with a
17transportation network company’s online-enabled application or
No reimbursement is required by this act pursuant to
20Section 6 of Article XIII B of the California Constitution because
21the only costs that may be incurred by a local agency or school
22district will be incurred because this act creates a new crime or
23infraction, eliminates a crime or infraction, or changes the penalty
24for a crime or infraction, within the meaning of Section 17556 of
25the Government Code, or changes the definition of a crime within
26the meaning of Section 6 of Article XIII B of the California