Insurance issue bogs down proposed UberX, Lyft regulations

Politics
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DENVER — Lawmakers and stakeholders are still at an impasse over what insurance requirements should be applied to UberX and Lyft drivers who use their private vehicles for commercial transportation, a question that remains unsettled after a long hearing Wednesday afternoon.

Senate Bill 125, which has already cleared the Senate, prompted several hours of testimony before the House Transportation Committee, but the panel delayed amendments and an ultimate vote on the measure until a later date to allow more time to hammer out a compromise.

Gov. John Hickenlooper’s office entered the debate publicly for the first time, with Jack Finlaw, the governor’s general counsel, suggesting that the issue of insurance for Transportation Network Company drivers be taken out of the bill and referred to the Public Utilities Commission.

“It’s really important to open Colorado up to these TNCs but we also want to see adequate insurance requirements,” Finlaw told FOX31 Denver after testifying. “Perhaps, given how complicated this issue is, we should delegate this to the PUC so they can have more time and a full rule-making process to take care of this issue.

“We don’t want the complexity of the issue to sink the whole bill. We need to establish this regulatory structure.”

The bill’s sponsor, Rep. Dan Pabon, D-Denver, believes lawmakers can — and should — figure it out themselves.

“This is a policy question; policy questions get answered by the elected General Assembly, not an administrative agency,” Pabon told FOX31 Denver. “This issue is far too important to just punt to the PUC.

“My colleagues and I were elected to decide on the finer points of this innovative business model including ensuring public safety and promoting jobs and economic opportunity.”

Currently, the legislation calls for the driver’s private insurance policy, effective when a driver is using their car for personal use, to cover both the driver and passenger when the application is switched on and car is being used commercially, which UberX and Lyft support.

That, however, is likely to cause all private car insurance policies in Colorado to spike, insurance companies have said.

Uber and Lyft may be willing to carry secondary insurance for their drivers, so that if a driver’s primary insurance policy denies a liability claim, there would at least be a back-up policy.

Taxi and limousine companies, which have been frustrated that S.B. 125 would apply far lighter regulations to TNCs than what they’re subjected to already, are pushing that UberX and Lyft drivers be forced to purchase commercial insurance.

That’s what insurance companies want, too.

S.B. 125 will force TNCs to conduct background checks on all drivers, inspect vehicles and obtain a permit from the PUC.

But it would exempt TNCs like Uber and Lyft from many of he PUC regulations that traditional cabs are subject to, including regulation of rates, entry, operational requirements, and general requirements governing common carriers.

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