Governor Signs Cabaldon bill reducing fares for customers on Uber, Lyft
SACRAMENTO— Today, Governor Gavin Newsom signed Senate Bill 371, a bill authored by Senator Cabaldon to address the costs of transportation services such as Uber and Lyft. Governor Newsom had previously announced his support for SB 371 as part of a legislative package to benefit both riders and drivers.
“I am incredibly grateful for Governor Newsom’s commitment to addressing affordability and lowering the costs of rides,” Senator Cabaldon said. “My interest in carrying this legislation was to lower fares for people who use rideshare for necessary transportation to their jobs, school, or medical appointments. The Governor’s signature on this legislation accomplishes that goal. These efforts will also provide rideshare drivers the choice to join a union and negotiate for better wages, benefits, and protections, creating a more robust and thriving industry for riders and drivers.”
SB 371 will reduce the cost of rideshare services for Californians by adjusting the requirement that rideshare drivers carry $1 million in coverage for accidents caused by other drivers who are uninsured or under-insured – a cost that today is passed on to riders in fees. The bill lowers the required coverage to $60,000 in uninsured and under-insured motorist coverage per individual and $300,000 per accident.
The insurance requirements for rideshare companies were established more than a decade ago when the industry was in its infancy. Ten years of claims data have demonstrated that they are far higher than needed.
According to Uber, the outsized insurance coverage currently required for rideshare vehicles has led to higher costs for riders in California. In Los Angeles, for instance, 45 percent of a typical ride fare in May 2025 went to pay for government-mandated insurance. Additionally, Lyft has calculated that an average of $6 of each ride in California goes to insurance – double the national average.
By comparison, taxis, buses and limos are not required to carry uninsured and under-insured motorist coverage.