Cab Firm Must Beef Up Insurance, Panel Says
A Los Angeles city panel voted 6 to 0 Thursday to require Valley Cab Co. to strengthen its insurance coverage and gave the embattled company, which is being forced to defend its monopoly in the San Fernando Valley, until Oct. 1 to meet the new conditions. If the conditions are not met, the firm’s franchise could be revoked.
The new rules should assure that Valley Cab is “properly protecting the public by having adequate insurance,” said Ken Cude, head of the taxicab unit in the city’s Department of Transportation.
But Thomas Hefferan, Valley Cab general manager, said the firm already has enough insurance and will be able to comply with the new rules.
The rules emerged amid questions about the firm’s self-insurance coverage first raised by Babaeian Transportation Co., a Burbank-based firm seeking permission to break Valley Cab’s monopoly. The changes require Valley Cab to keep its account for paying insurance claims in a California bank, making it easier for claimants to collect. The firm’s account is now in Nevada.
The rules also require Valley Cab to file timely reports about accidents involving its drivers and to set aside sufficient cash to cover outstanding insurance claims in addition to a $350,000 insurance reserve.
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