California’s 2026 Rideshare Insurance Reform: What Adjusters Should Know

By: Garrett E. Zagrodzky, Straus Meyers LLP

The insurance landscape for rideshare accidents in California changed significantly on January 1, 2026, when Senate Bill 371 (SB 371) took effect. Chapter 314 of the legislation modifies the insurance requirements for transportation network companies (TNCs), such as Uber and Lyft, and may significantly impact claims professionals handling auto liability and uninsured/underinsured motorist claims.

Before 2026, California law required rideshare companies to maintain $1,000,000 in uninsured/underinsured motorist (UM/UIM) coverage for passengers from the moment a passenger entered a rideshare vehicle until the ride ended. This coverage served as an important safety net in situations where the at-fault driver had little or no insurance coverage.

The $1,000,000 requirement helped ensure that catastrophic injury claims, such as those involving traumatic bodily injury claims, had sufficient insurance coverage available for compensation. Rideshare companies were required to maintain $1,000,000 in third party liability coverage for accidents caused by the rideshare driver during an active trip.

SB 371, Chapter 314 significantly reduces the UM/UIM insurance coverage that rideshare companies must provide. Under the new legislation, the mandatory coverage limits are:

• $60,000 per individual
• $300,000 per accident

This represents approximately a 94% reduction from the previous $1,000,000 requirement.

The legislation was signed by Governor Gavin Newsom in October 2025 as part of a legislative compromise addressing rideshare insurance obligations and rideshare worker labor rights. Supporters argue that the reduced coverage requirements may help lower operating costs for transportation network companies and potentially make rides more affordable for consumers.

For insurance adjusters, the reduction in UM/UIM coverage may significantly impact how rideshare accident claims are evaluated. Lower policy limits may increase reliance on personal auto UM/UIM policies carried by passengers or drivers to supplement damages that exceed the reduced rideshare coverage limits.

Rideshare claims will also continue to require careful evaluation of the driver’s operational status within the rideshare application. Coverage often depends on whether the driver was logged into the app, waiting for a ride request, en route to pick up a passenger, or actively transporting a passenger at the time of the accident.

As rideshare services continue to expand across California, the reduction in required UM/UIM coverage under SB 371 represents a meaningful shift in risk allocation and may increase the complexity of evaluating rideshare accident claims.