Latest "Uber" Bill Contains The Same Flaws As The Original

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Michigan Car Accident Lawyers – Latest “Uber” Bill Contains The Same Flaws As The Original

Another Uber bill was proposed in the Michigan legislature this week. Although it improves upon some of the proposals outlined in the bill that was drafted last month, substituted House Bill No. 5951 still contains some of the same flaws that plagued the original bill.

Uber, Lyft , Sidecar and other similar transportation service companies have grown rapidly in popularity throughout the county and world.  They are often referred as “transportation network companies” in that they utilize a digital network to connect independent drivers and passengers.

Uber is very similar to a taxi service, except instead of hailing a taxi or calling a taxi dispatching service, the user simply presses a few buttons on a smartphone to order a ride. Uber drivers are independent contractors and only get paid if they complete a fare. A portion of each fare goes to Uber.

A major issue Uber and its competitors have had to deal with is that many of their drivers are not properly insured.  Because they are independent contractors, and often not properly screened, many of the drivers are carrying minimal insurance policies. This has created major controversy because (1) taxi services that purchase more expensive commercial insurance policies see Uber’s lower cost policies as an unfair advantage, and (2) consumer groups view the arrangement as dangerous to the general public.

Although Uber does offer a $1,000,000 bodily injury policy for its drivers, as well as a $1,000,000 uninsured and underinsured policy, this protection only kicks in once a prospective rider has ordered a ride through the digital network.  Before rides are ordered and while Uber drivers are looking for fares – and often at their most dangerous – Uber offers nothing more than a minimal $50,000 policy for its drivers.

The substituted House Bill does nothing to change this. In fact, it makes things worse. Although all transportation companies would be required to purchase a $1,000,000 policy to cover all incidents during “a prearranged ride”, these same companies would only be required to purchase a state minimum $20,000 policy for their drivers before a ride is ordered.

This amount is even lower than what Uber requires of its own drivers.

Further, under the new bill, transportation service companies would merely have to communicate to their drivers that their own personal insurance policies may not provide coverage while they use the vehicle in connection with a transportation network company’s digital network. This communication does not extend to the customers themselves.

The substituted bill also does not require Uber or its competitors to purchase uninsured or underinsured motorist coverage for their drivers. As we all know, many Michigan motorists operate vehicles without adequate insurance to cover accidents they cause – or with no insurance at all. There is no reason the Michigan legislature should not adequately protect transportation network company drivers, their passengers, and the public by requiring these companies to purchase this added coverage.

If Uber and its competitors want to profit by using Michigan roads, they should have to provide the necessary protection to guard against accidents its drivers may cause.

Unfortunately, substituted House Bill 5951 is very similar to its predecessor.  It does nothing to protect the public while Uber drivers are looking for fares. It does not provide adequate protection in case uninsured or underinsured drivers cause accidents. The bill appears to give an unfair competitive advantage to Uber and it’s competitors versus taxi companies who are required to purchase more expensive commercial policies.

Hopefully our state legislators finally realize these shortcomings and offer additional amendments to this house bill to improve upon it.  It would be good for Michigan drivers and signal to other states that our state is serious about public safety.