Senator Rick Cabaldon announced in a press release that the passage of Senate Bill 371 will lower rideshare fares for essential trips while ensuring drivers’ costs are addressed to sustain supply and affordability across California.
“My interest in carrying SB 371 was to lower fares for people who use rideshare for necessary transportation to their jobs, school, or medical appointments,” said Rick Cabaldon, California State Senator. “As we worked through the Legislative process, it became clear that without addressing the needs of drivers we would not be able to attract enough of them to meet demand, a shortage that is already contributing to higher fares. I’m happy to see the two bills joined as a benefit for both drivers and riders.”
Senate Bill 371, officially passed and signed into law in August 2025, reforms California’s rideshare insurance framework by significantly reducing the state-mandated uninsured/underinsured motorist (UM/UIM) coverage levels for rideshare companies like Uber and Lyft. The previous $1 million coverage minimum—applicable during Period 1 of a ride (when a driver is logged into the app but has not yet accepted a trip)—was reduced to $60,000 per person and $300,000 per incident, aligning it with other transportation modes such as taxis and limousines.
According to state lawmakers, the passage of SB 371 will provide meaningful cost relief to California residents who rely on rideshare services as a critical part of their daily lives. Legislative leaders said that the newly enacted law offers “real affordability relief” by shifting excess insurance burdens off the rideshare economy and restoring a balance between passenger safety and fare control. According to the Governor’s Office, this reform is expected to have the greatest benefit in urban and suburban regions where rideshare use is heaviest, especially among those without access to regular public transit.
A 2025 industry analysis cited by Uber and Lyft during legislative hearings revealed that insurance costs in California account for roughly 45% of the total fare paid by passengers—one of the highest rates in the country. This elevated burden has been attributed to California’s strict UM/UIM coverage requirements, which far exceeded those imposed on other transportation services. By realigning insurance minimums, SB 371 is expected to significantly reduce operating costs for transportation network companies (TNCs). These savings will be partially passed on to riders, reducing the cost of short- and medium-distance trips—particularly in price-sensitive communities.
In addition to its consumer-facing benefits, SB 371 was designed to improve working conditions for rideshare drivers by eliminating high-cost insurance mandates that were being deducted from driver earnings. Cabaldon said that driver shortages were already driving up fare prices due to insufficient supply, and that addressing driver-side costs was essential to balancing the rideshare marketplace. With reduced insurance overhead, more drivers may be incentivized to join or stay in the workforce, leading to improved service availability and shorter wait times—both of which contribute to the overall affordability and reliability of the rideshare ecosystem.
Cabaldon began his term representing Yolo County in 2024 and quickly became known for championing affordability in essential services. Before his election to the California State Senate, he was the long-serving mayor of West Sacramento, where he focused heavily on transportation equity, housing, and infrastructure innovation.
