For more than a decade, the headline number in a California rideshare injury case was simple: a $1 million uninsured and underinsured motorist policy sat behind every passenger during an active trip. That number is gone. Senate Bill 371, signed in late 2025 and effective January 1, 2026, cut the mandatory transportation network company UM/UIM floor to $60,000 per person and $300,000 per incident. The third-party liability policy that responds when the rideshare driver is at fault stays at $1 million. The cut lands squarely on the cases where a phantom or underinsured outside driver causes the wreck.
The practical effect is that recovering full value for a badly hurt passenger now depends on assembling coverage from more than one tower. Stacking, which many California practitioners had treated as a secondary concern when a seven-figure TNC policy was sitting right there, is back at the center of intake and pre-litigation analysis.
What SB 371 actually changed
SB 371 amended the Public Utilities Code provisions that govern TNC insurance. The reduction is narrow but consequential. It touches only the UM/UIM component during Period 2 and Period 3, the windows when a driver has accepted a ride request or has a passenger in the car. The $1 million at-fault liability coverage is untouched, and the during-ride first-party medical and collision terms are unchanged. What evaporated is the cushion that used to protect a passenger when the at-fault driver was uninsured or carried a state-minimum policy.
For a fractured pelvis or a moderate traumatic brain injury, $60,000 does not approach the medical specials, let alone general damages. The question is no longer whether the TNC policy covers the loss. It is which other policies can be brought to bear and in what order.
Period definitions still control everything
Before any stacking analysis, pin down the period. The driver's app status at the moment of impact decides which insurance regime applies:
- Period 0: app off. Only the driver's personal auto policy responds, and personal policies routinely exclude livery use.
- Period 1: app on, no ride accepted. Contingent liability applies, and UM/UIM coverage is thin or absent.
- Period 2 and 3: ride accepted or passenger aboard. The reduced TNC UM/UIM now governs, alongside the intact $1 million at-fault policy.
Telematics and app data fix the period with precision. Send a preservation letter for the trip record early, because the carrier will use the same data to argue the period that minimizes its exposure.
Where stacking comes back into play
With the TNC floor slashed, a passenger's own coverage often becomes the larger source of recovery. Three sources deserve a hard look on every file:
- The passenger's personal UM/UIM policy. A passenger injured as an occupant of a rideshare vehicle is generally still an insured under their own auto policy for UM/UIM purposes. California permits recovery from a claimant's own UIM coverage as excess once the at-fault and TNC sources are exhausted, subject to the policy's offset language.
- Resident relative policies. California's household and resident-relative rules can pull in a spouse's or parent's UM/UIM coverage when the injured passenger lives in the same home, expanding the pool beyond a single policy.
- The at-fault driver's liability limits. Even a minimal outside policy should be tendered and documented, because UIM analysis turns on the gap between that driver's limits and the claimant's available underinsured coverage.
Anti-stacking clauses are where carriers concentrate their resistance. California enforces validly drafted anti-stacking language within a single policy, but coverage across separate policies issued to different named insureds is a different question, and the offset sequence matters. Read every declarations page, not just the client's.
Carrier pushback and the arguments that hold
Expect three moves. First, the TNC carrier will argue its reduced UM/UIM is the only first-party source and that personal coverage is barred by an other-insurance clause. Second, the passenger's own carrier will assert that the TNC policy is primary and that its UIM does not drop down until the full TNC limit plus the tortfeasor's limit are paid. Third, both will fight over offsets so that the same dollar is credited twice.
The durable counter is sequencing. Establish the order of priority on paper before negotiating numbers: the at-fault driver's liability first, the TNC UM/UIM second as primary first-party coverage, then the passenger's UIM as true excess. Calculate each offset against the policy that actually paid, not against the gross settlement. When a carrier's other-insurance clause conflicts with a competing clause, California's mutual-repugnancy approach can require proration rather than a clean escape for either insurer.
Practice points
- Run a coverage census at intake: TNC tower, at-fault driver, client's personal policy, and every resident-relative policy in the household.
- Preserve trip and telematics data immediately to lock the period and defeat a period downgrade.
- Document the underinsured gap with specials and a damages model before tendering, so the UIM drop-down is not premature.
- Coordinate the rideshare recovery with any medical lien strategy early, because reduced policy limits compress what is left for providers and the client. Our coverage of lien resolution and settlement accounting tracks how those reductions play out at disbursement.
SB 371 did not eliminate value in rideshare cases. It moved the value off a single large policy and spread it across a stack that the practitioner has to build deliberately. For more on coverage strategy in collision files, see our ongoing auto accident litigation coverage, and for the commercial-policy parallels that arise when a delivery or trucking carrier is involved, our truck and motorcycle section.