Following threats to take their business out of Kansas if the legislature passed a bill they strongly opposed, Uber has done just that. After losing their bid to keep the bill, entitled SB 117, from becoming law, the ride-sharing company left the state in a huff, shutting down its operations. And, although background checks seemed to be at the heart of the Uber’s contentious behavior, auto insurance requirements also appeared to be a thorny issue.
Ironically, the measure was not aimed at Uber alone, but also at Lyft, its ride-sharing service competitor. Both would be affected by required background checks for all their drivers operating in the state – which means every new driver of the two companies would be subject to these background checks.
The law further mandates that auto insurance policies include “$1,000,000 liability insurance for death, bodily injury and property damage” while drivers actively transport passengers around, but stipulations also apply when drivers are logged into a ride-sharing network and have no assigned commuters.
By using a mobile app, Uber connects people seeking a ride to private drivers. Riders pay a fee to Uber, who then pays their drivers. Because the drivers use their private vehicles to go pick people up and take them where they want to go, the law was implemented to require new Uber drivers to pass in-depth background checks through the Kansas Bureau of Investigation, in addition to carrying comprehensive insurance and collision insurance.
Leading up to the vote, Uber contended they do their own background checks and the insurance was unnecessary. But, others disagreed and pushed for new legislation to put more controls on ride-sharing companies. Interestingly, Uber was not the only dissenter to the law. In fact, Governor Sam Brownback was also opposed and vetoed it. However, the legislature managed to force Uber’s hand to shut down and leave the state by overriding Brownback’s veto.
According to Brownback, the reason for his veto was due in part to his belief that background checks fall under the category of over-regulation, which would stifle future job creation and innovative development in Kansas. Furthermore, he also felt the legislation was premature.
So, for the time being, Kansas residents who have one too many, will have to hail a cab to take them home – at least until Uber rethinks its hasty decision and tries to make a comeback.
As a motorist, you don’t have the option to leave a state in a huff or otherwise because of your auto insurance. Wherever you go – you are required to have it if you want to operate a vehicle on the nation’s highways. Why not make sure you’ve got the best auto insurance rates by getting a free auto insurance quote today?
Do you think Uber was unfairly singled out? Should they have left the state of Kansas? Feel free to share your thoughts in the comments section below.