Uber announced on its website that the signing of California Senate Bill 371 will reduce insurance costs for rideshare companies, making trips more affordable while maintaining protections for riders and drivers.
According to Uber’s October 2025 announcement, SB 371 stems from a compromise between the California governor, legislative leaders, rideshare companies, and SEIU (Service Employees International Union) California to update insurance rules that were inflating rider costs. Uber said that California riders previously paid some of the highest insurance-related costs in the U.S.—with roughly one-third of every fare statewide and nearly half in Los Angeles County going to government-mandated insurance. By reforming those rules, the company aims to lower fares while keeping liability and occupant protections in place.
According to the bill text and policy committee analyses of SB 371, the uninsured/underinsured motorist (UM/UIM) coverage requirement that applied only to rideshare vehicles will be reduced from $1 million per incident to approximately $60,000 per individual and $300,000 per accident starting January 1, 2026—aligning with other passenger vehicle requirements. This reduction is expected to relieve the financial load on both riders and drivers by cutting one of the major “hidden costs” embedded in fares. The reform also retains a $1 million liability cap for accidents caused by rideshare drivers and preserves $1 million occupational accident coverage (through Proposition 22) for drivers injured while driving, ensuring protections remain strong despite lower UM/UIM limits.
According to external reporting, rideshare insurance mandates in California were among the highest in the country, contributing to fare charges that are significantly above national averages due to the high UM/UIM threshold and litigation-related cost inflation. For example, one industry analysis estimated that insurance costs could represent up to 25% or more of rideshare fares in major California counties—limiting driver earnings and price competitiveness. Observers say SB 371’s reform is targeted to disentangle rideshare from insurance practices originally designed for taxis and personal vehicles, thereby enhancing affordability and platform access for drivers and consumers alike.
According to Uber’s corporate overview, Uber Technologies Inc. is a global mobility and delivery platform operating in more than 70 countries and connecting millions of riders, drivers, couriers, and merchants daily. The company collaborates with regulators, labor organizations, and industry partners to reform regulations that affect affordability, safety, and driver earnings. Uber said that passing SB 371—and its companion legislation AB 1340—demonstrates how the company supports pragmatic policy solutions that lower costs for riders while preserving driver flexibility and consumer protections.
