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.
The 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 authorize a personal automobile insurer to offer such coverage at its discretion to cover private vehicles, as specified. 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
3read:
4
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 provides
13prearranged transportation services for compensation using an
14online-enabled application or platform to connect passengers with
15drivers using a personal 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 while the driver
uses a
29vehicle in connection with a transportation network company’s
30online-enabled application or platform, and shall advise a
31participating driver in writing that the driver’s personal automobile
32insurance policy will not provide coverage because the driver uses
33a vehicle in connection with a transportation network company’s
34online-enabled application or platform.
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
23the following:
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
39the insured.
P5 1(4) A transportation network company may meet its obligations
2under this subdivision through a policy obtained by a participating
3driver pursuant to subparagraph (A) or (C) of paragraph (1) only
4if the transportation network company verifies that the policy is
5begin insert maintained by the driver and isend insert specifically written to cover
6begin delete transportation network company services and is maintained by the begin insert
the driver’s use of a vehicle in connection with a
7driver.end delete
8transportation network company’s online-enabled application or
9platform.end insert
10(c) The following requirements shall apply to transportation
11network company insurance from the moment a participating driver
12logs on to the transportation network company’s online-enabled
13application or platform until the driver accepts a request to transport
14a passenger, and from the moment the driver completes the
15transaction on the online-enabled application or platform orbegin delete untilend delete
16 the ride is complete, whichever is later, until the driver either
17accepts another ride request on the online-enabled application or
18platform or logs off the online-enabled application or platform:
19(1) Transportation network company insurancebegin delete shall,end deletebegin insert shallend insert be
20primary and in the amount of at least fifty thousand dollars
21
($50,000) for death and personal injury per person, one hundred
22thousand dollars ($100,000) for death and personal injury per
23incident, and thirty thousand dollars ($30,000) for property damage.
24The requirements for the coverage required by this paragraph may
25be satisfied by any of the following:
26(A) Transportation network company insurance maintained by
27a participating driver.
28(B) Transportation network company insurance maintained by
29a transportation network company that provides coverage in the
30event a participating driver’s insurance policy under subparagraph
31(A) has ceased to exist or has been canceled, or the participating
32driver does not otherwise maintain transportation network company
33insurance pursuant to this subdivision.
34(C) Any combination of subparagraphs (A) and (B).
35(2) A transportation network company shall also maintain
36insurance coverage that provides excess coveragebegin insert insuring the
37transportation network company and the driver in the amountend insert of
38begin delete five hundred thousand dollars ($500,000)end deletebegin insert at least twoend insertbegin insert hundred
39thousand dollars ($end insertbegin insert200,000)end insert per
occurrence to cover any liability
40arising from a participating driver using a vehicle in connection
P6 1with a transportation network company’s online-enabled
2application or platform within the time periods specified in this
3subdivision, which liability exceeds the required coverage limits
4in paragraph (1).
5(3) The insurer providing insurance coverage under this
6subdivision shall be the only insurer having the duty to defend any
7liability claim arising from an accident occurring within the time
8periods specified in this subdivision.
9(4) A transportation network company may meet its obligations
10under this subdivision through a policy obtained by a participating
11driver pursuant to subparagraph (A) or (C) of paragraph (1) only
12if the transportation network company verifies that the
policy is
13begin insert maintained by the driver and isend insert specifically written to cover
14begin delete transportation network company services and is maintained by the begin insert
the driver’s use of a vehicle in connection with a
15driver.end delete
16transportation network company’s online-enabled application or
17platform.end insert
18(d) Coverage under a transportation network company insurance
19policy shall not be dependent on a personal automobile insurance
20policy first denying a claim nor shall a personal automobile
21insurance policy be required to first deny a claim.
22(e) In every instance where transportation network company
23insurance maintained by a participating driver to fulfill the
24insurance obligations of this section has lapsed or ceased to exist,
25the transportation network company shall provide the coverage
26required by this section beginning with the first dollar of a claim.
27(f) This article
shall not limit the liability of a transportation
28network company arising out of an automobile accident involving
29a participating driver in any action for damages against a
30transportation network company for an amount above the required
31insurance coverage.
32(g) This section shall become operative on July 1, 2015.
(a) Nothing in this section shall be construed to require
34a private passenger automobile insurance policy to provide primary
35or excess coverage during the period of time from the moment a
36participating driver in a transportation network company logs on
37to the transportation network company’s online-enabled application
38or platform until the driver logs off the online-enabled application
39or platform or the passenger exits the vehicle, whichever is later.
P7 1(b) During the period of time from the moment a participating
2driver in a transportation network company logs on to the
3transportation network company’s online-enabled application or
4platform until the driver logs off the
online-enabled application or
5platform or the passenger exits the vehicle, whichever is later, all
6of the following shall apply:
7(1) The participating driver’s or the vehicle owner’s personal
8automobile insurance policy shall not provide any coverage to the
9participating driver, vehicle owner, or any third party, unless the
10policy expressly provides for that coverage during the period of
11time to which this subdivision is applicable, with or without a
12separate charge, or the policy contains an amendment or
13endorsement to provide that coverage, for which a separately stated
14premium is charged.
15(2) The participating driver’s or the vehicle owner’s personal
16
automobile insurance policy shall not have the duty to defend or
17indemnify for the driver’s activities in connection with the
18transportation network company, unless the policy expressly
19provides otherwise for the period of time to which this subdivision
20is applicable, with or without a separate charge, or the policy
21contains an amendment or endorsement to provide that coverage,
22for which a separately stated premium is charged.
23(c) Notwithstanding any other law, a personal automobile insurer
24may, at its discretion, offer an automobile liability insurance policy,
25or an amendment or endorsement to an existing policy, that covers
26a private passenger vehicle, station wagon type vehicle, sport utility
27vehicle, or similar type of vehicle with a passenger capacity of
28eight persons or less, including the driver, while used in
connection
29with a transportation network company’s on-line enabled
30application or platform only if the policy expressly provides for
31the coverage during the time period specified in subdivision (b),
32with or without a separate charge, or the policy contains an
33amendment or an endorsement to provide that coverage, for which
34a separately stated premium may be charged.
35(d) 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
40times at which an accident occurred that involved a participating
P8 1begin delete driver.end deletebegin insert driver and the precise times that the participating driver
2logged on and off the transportation network company’s
3online-enabled application or platform.end insert
The commission and the Department of Insurance shall
5collaborate on a study of transportation network company insurance
6to assess whether coverage requirements are appropriate to the
7risk of transportation network company services in order to
8promote data-driven decisions on insurance requirements, and
9shall report the findings of this study to the Legislature no later
10than December 31, 2017.
A transportation network company shall not disclose to
12a third party any personally identifiable information of a
13transportation network company passenger unless one of the
14following applies:
15(1) The customer knowingly consents.
16(2) Pursuant to a legal obligation.
17(3) The disclosure is to the commission in order to investigate
18a complaint filed with the commission against a transportation
19network company or a participating driver and the commission
20treats the information under confidentiality protections.
It is the intent of the Legislature that the Department of
22Insurance expedite review of any application for approval of
23transportation network company insurance products, and that these
24products become available for purchase on or before July 1, 2015.
Transportation network company insurance that meets
26the requirements of Section 5433 shall be deemed to satisfy the
27financial responsibility requirements of Sections 16054 and 16056
28of the Vehicle Code.
The Legislature makes the following findings:
30(a) The commission has initiated regulation of transportation
31network companies as a new category of charter-party carriers and
32continues to develop appropriate regulations for this new service.
33(b) Given the rapidly evolving transportation network company
34service, it is the intent of the Legislature to continue ongoing
35oversight of the commission’s regulation of these services in order
36to enact legislation to adjust commission authority and impose
37specific requirements or prohibitions as deemed necessary as these
38services evolve.
The Legislature does not intend, and nothing in this
40article shall be construed, to prohibit the commission from
P9 1exercising its rulemaking authority in a manner consistent with
2this article, or to prohibit enforcement activities related to
3transportation network companies.
A participating driver of a transportation network
5company shall carry proof of transportation network company
6insurance coverage with him or her at all times during his or her
7use of a vehicle in connection with a transportation network
8company’s online-enabled application or platform. In the event of
9an accident, a participating driver shall provide this insurance
10coverage information to any other party involved in the accident,
11and to a police officer, upon request.
Notwithstanding Section 11580.9 of the Insurance Code,
13or any other law affecting whether one or more policies of
14insurance that may apply with respect to an occurrence is primary
15or excess, this article determines the obligations under insurance
16policies issued to transportation network companies and, if
17applicable, drivers using a vehicle in connection with a
18transportation network company’s online-enabled application or
19platform.
No reimbursement is required by this act pursuant to
21Section 6 of Article XIII B of the California Constitution because
22the only costs that may be incurred by a local agency or school
23district will be incurred because this act creates a new crime or
24infraction, eliminates a crime or infraction, or changes the penalty
25for a crime or infraction, within the meaning of Section 17556 of
26the Government Code, or changes the definition of a crime within
27the meaning of Section 6 of Article XIII B of the California
28Constitution.
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