Calif. PUC Issues Proposed Resolution Involving Commission General Orders, Insurance Certificate Form PL-914, Insurance Endorsement Form PL-912

SACRAMENTO, California, Feb. 10 -- The California Public Utilities Commission issued the following proposed resolution (No. TL-19147) on Feb. 9, 2024:

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Resolution Amending Commission General Orders 101-E And 115-G, Insurance Certificate Form PL-914, And Insurance Endorsement Form PL-912 Incorporating Insurance Requirements For Contract Crew Transportation Vehicles Pursuant To Senate Bill 757 And Clarifying Calculation Of Seating Capacity And Approval To Self-Insure

SUMMARY

This Resolution amends Commission General Orders 101-E and 115-G, Insurance Certificate Form PL-914, and Insurance Endorsement Form PL-912 to adopt the new insurance requirements for [Railroad] Contract Crew Transportation Vehicles established by Senate Bill 757 (Archuleta: 2023). This Resolution also clarifies the calculation of vehicle seating capacity for purposes of required minimum amounts of liability insurance coverage and replaces references to the defunct "Interstate Commerce Commission" with the "Federal Motor Carrier Safety Administration" as the agency that grants carriers the approval to self-insure.

BACKGROUND

State law establishes the insurance requirements for Passenger Stage Corporations (PSCs) and Transportation Charter-Party Carriers (TCPs) in California Public Utilities (Pub. Util.) Code Sec.Sec. 1040 and 5391,/1 respectively, and for Transportation Network Companies (TNCs) in Pub. Util. Code Sec. 5433./2 The Commission has adopted these statutory requirements into Commission General Order (GO) Series 101 for PSCs and Series 115 for TCPs and TNCs. Commission Resolution TL-19105/3 requires that insurance information be filed electronically./4 Pursuant to the GO Series 101 and 115 and Resolution TL-19105, the insurance carriers of applicants and carriers must certify to the terms of the "MOTOR CARRIER AUTOMOBILE BODILY INJURY LIABILITY AND PROPERTY DAMAGE LIABILITY CERTIFICATE OF INSURANCE" (Form PL-914) when filing the insurance policy information with the Commission./5 By certifying to the terms found in Insurance Certificate Form PL-914, the insurance company stipulates that:

1. the Motor Carrier Automobile Bodily Injury Liability and Property Damage (PL&PD) insurance policy is amended by the attachment of Insurance Endorsement Form PL912;

2. by attachment, the insurance policy provides liability protection as required by Pub. Util. Code Sec.Sec. 1040, 5391 or 5391.2, or 5433 where applicable; by General Order 101 Series and/or General Order 115 Series, and by the pertinent rules, orders, and regulations of the Commission;

3. the protection of the insurance policy extends to the operation, maintenance, or use of any vehicle requiring a Commission certificate of permit although such vehicle may not be specifically described in the policy;

4. upon request the insurance company will provide the Commission a copy of the insurance policy and all endorsements; and

5. the insurance policy cannot be cancelled without thirty (30) days prior notice to the Commission.

Furthermore, when filing an insurance policy electronically, the insurance company certifies that the Standard Form of Endorsement Prescribed by the Public Utilities Commission of the State of California (Form PL-912) is attached to the policy which includes, in part, the following terms and conditions:

1. That the policy to which the PL-912 is attached is amended to ensure compliance of the insured as to their operations as a PSC or TCP to provide the liability protection as required by Pub. Util. Code Sec.Sec. 1040, 5391 or 5391.2, or 5433 where applicable, by General Order Series 101 and/or General Order Series 115, and by the pertinent rules, orders, and regulations of the Commission;

2. That in consideration of the policy's premium, the insurance company agrees to pay any final judgment against the insured for bodily injury to or death of any person, or loss of or damage to property to others, with specific exclusions;

3. That there are no conditions or limitations in the policy to this endorsement;

4. That the limitations in coverage apply separately to each accident, and that any payment for any one accident will not reduce the liability of the insurance company for any other accident; and

5. That a schedule of insurance limits based upon the seating capacity of each motor vehicle is included.

SB 757 (ARCHULETA: 2023)

On October 7, 2023, Governor Newsom approved Senate Bill (SB) 757 (Archuleta), which adds Section 5384.3 to the Public Utilities Code. The new Pub. Util. Code Sec. 5384.3 establishes insurance requirements for [Railroad] "Crew Transportation Operators"/6 that operate "Contract Crew Transportation Vehicles,"/7 defined in Pub. Util. Code Sec. 5384.3(a)(2) and Sec. 5384.3(a)(1), respectively. Pub. Util. Code Sec. 5384.3(c) requires that the [Railroad] Crew Transportation Operators furnish evidence of insurance to the Commission that there is in force: (1) at least $5,000,000 combined single limit bodily injury and property damage insurance and (2) at least $1,000,000 uninsured and underinsured motorist coverage.

To fully protect the public, Pub. Util. Code Sec. 5384.3, along with its insurance requirements, should be incorporated by the Commission into Forms PL-914, PL-912, and Commission General Order Series 101 and 115.

VEHICLE SEATING CAPACITY

The amount of liability coverage required by the Commission is determined by vehicle seating capacity. The exceptions to this are transportation network companies, carriers that operate under TCP "C" Certificates, and the newly created Crew Transportation Operators.

Currently, in the calculation of vehicle seating capacity, GO 101-E and GO 115-G refer to the number of "passengers" in the vehicle without accounting for the "driver" of the vehicle. Commission staff have received occasional inquiries from carriers, insurance companies, and insurance brokers as to whether the driver of the vehicle counts as a passenger. The description of vehicle seating capacities is inconsistent between the Public Utilities Code, Code of Federal Regulations (CFR), Commission General Orders, and the Insurance Endorsement Form PL-912. This Resolution proposes to create consistency in these descriptions through the applicable Commission GOs and supporting Insurance Endorsement and the Public Utilities Code.

Insurance requirements for PSCs and TCPs are found in Pub. Util. Code Sec. 1040,/8 which requires that the insurance levels not be set at an amount less than the amount set by the Federal Bus Regulatory Reform Act of 1982 (P.L. 97-261), as amended, and not more than $750,000 for "...vehicles designed to carry not more than eight persons, including the driver..."/9 (emphasis added)

49 CFR Sec. 387.33T/10 sets the minimum insurance requirements as:

Vehicle seating capacity ...Minimum limits

(a) Any vehicle with a seating capacity of 16 passengers or more, including the driver ...$5,000,000

(b) Any vehicle with a seating capacity of 15 passengers or less, including the driver ...$1,500,000

In one of its definitions of "commercial motor vehicle," 49 CFR Sec. 387.33T describes it as "designed or used to transport more than 8 passengers (including the driver) for compensation..." However, as previously stated, Pub. Util. Code Sec. 1040 clarifies the $750,000 insurance requirement for vehicles that seat up to eight persons and explicitly includes the driver in the calculation of vehicle seating capacity.

While the CFR and Pub. Util. Code specifically mention the driver (e.g., "Any vehicle with a seating capacity of 16 passengers or more, including the driver" requires $5,000,000 of insurance coverage), GOs 101 and 115 and the Insurance Endorsement Form PL-912 do not contain any reference to including the driver (e.g., "Any vehicle with a seating capacity of 16 passengers or more" requires $5,000,000 of insurance coverage). GO series 101 and 115 and Insurance Forms PL-912 and PL-914 do not use consistent terminology when referring to vehicle seating capacity and insurance requirements. They state that "[a]ny vehicle with a seating capacity of 7 passengers or less" requires $750,000 of coverage. However, Pub. Util. Code Sec. 1040 specifically states that that level is for vehicle with a seating capacity of eight passengers, including the driver.

To be consistent and clear, GOs 101 and 115 and Insurance Endorsement Form PL-912 should be updated to match the descriptions in the CFR and Pub. Util. Code by specifying that the driver is included in the calculation of vehicle seating capacity.

SELF-INSURANCE

GOs 101-E and 115-G require that carriers that opt to be self-insured be qualified as a selfinsurer with the Interstate Commerce Commission (ICC). Both GOs state:

(6) Any charter-party carrier of passengers engaged in interstate or intrastate operations within the State of California, which is and becomes qualified as a self-insurer with the Interstate Commerce Commission promulgated thereunder, shall be exempt, so long as such qualification remains effective, from the foregoing provisions of this General Order. Proof of the existence and continuation of such exempt status shall be filed with the Commission annually. Such proof of such qualification shall be filed in such form and at such times as the Commission may require.

(7) Each charter-party carrier of passengers desiring to become qualified as a self-insurer, or to have orders or certificates issued by the Interstate Commerce Commission authorizing self-insurance accepted by this Commission, or to have other securities or agreements of indemnity accepted in lieu of the bond or insurance hereinabove provided, shall make application therefore to this Commission stating all of the facts which shall be required by the Commission with respect thereto. If such application is approved, such charter-party carrier of passengers, while such order of approval shall remain effective, shall be exempt from furnishing a certificate of insurance or bond hereinabove provided.

The ICC was abolished with the ICC Termination Act of 1995 (Public Law No. 104-88, 109 Stat. 803)./11 The Motor Carrier Safety Improvement Act of 1999 created the "Federal Motor Carrier Safety Administration" (FMCSA)./12 The FMCSA has taken over granting carriers that authority to self-insure./13 GOs 101 and 115 should be updated to reflect the FMCSA's role in qualifying carriers to self-insure.

COMMENTS

Public Utilities Code Sec. 311(g)(1) provides that this Resolution must be served on all parties and subject to at least 30 days public review. Any comments are due within 20 days of the date of its mailing and publication on the Commission's website and in accordance with any instructions accompanying the notice. Section 311(g)(2) provides that this 30-day review period and 20-day comment period may be reduced or waived upon the stipulation of all parties in the proceeding.

The 30-day review and 20-day comment period for the draft of this Resolution is neither waived nor reduced. Accordingly, this draft Resolution was emailed to all licensed PSCs and TCPs along with all insurance companies with active accounts in the Commission's Transportation Carrier Portal for comments and will be placed on the Commission's agenda no earlier than 30 days from today.

FINDINGS OF FACT

1. Insurance requirements for PSCs are set forth in Pub. Util. Code Sec. 1040.

2. Insurance requirements for TCPs are set forth in Pub. Util. Code Sec.Sec. 1040 and 5391.

3. The insurance filing requirements for PSCs and TCPs are set forth in Commission General Order Series 101 and 115.

4. Commission Resolution TL-19105 requires an insurance company to electronically file an insurance certificate for the policies they insure.

5. When an insurance company files the required insurance policy electronically, they must also file a "MOTOR CARRIER AUTOMOBILE BODILY INJURY LIABILITY AND PROPERTY DAMAGE LIABILITY CERTIFICATE OF INSURANCE" (Form PL-914), which states in part that the insurance company of the passenger carrier certifies that the insurance policy has been amended by the attachment of "STANDARD FORM OF ENDORSEMENT PRESCRIBED BY THE PUBLIC UTILITIES COMMISSION OF THE STATE OF CALIFORNIA" (Form PL-912).

6. Form PL-912 ensures compliance of the PSC and/or TCP carrier with Pub. Util. Code Sec.Sec. 1040 and 5391, where applicable, and GO 101 Series and/or GO 115 Series, and the pertinent rules, orders, and regulations of the California Public Utilities Commission.

7. SB 757 set new insurance requirements for [Railroad] Crew Transportation Operators that operate Contract Crew Transportation Vehicles.

8. Commission staff have received inquiries regarding if a driver is counted as a passenger when determining the minimum required level of insurance.

9. Passenger carriers can satisfy insurance requirements under GOs Series 101 and 115 by showing that they have been qualified as self-insurers by the Federal Government.

10. The Interstate Commerce Commission (ICC) was abolished with the ICC Termination Act of 1995 (Public Law 104-88).

11. The Federal Motor Carrier Safety Administration now qualifies carriers to self-insure pursuant to CFR Title 49 Sec. 13906.

12. GOs Series 101 and 115 and Forms PL-912 and PL-914 should be updated to include insurance requirements of SB 757, clarify vehicle seating capacity requirements, and identify the FMCSA as the current agency that qualifies passenger carriers to selfinsure.

THEREFORE, IT IS ORDERED THAT:

1. Amended Commission General Orders 101-E and 115-G, and Commission Insurance Forms PL-912 and PL-914, as found in Appendices 1 through 4 of this Resolution, shall be adopted.

2. The Executive Director shall cause a copy of this Resolution to be served on all licensed Passenger Stage Corporations and Charter-Party Carriers and insurance companies with active accounts in the Commission's Transportation Carrier Portal.

3. This Resolution is effective today.

I hereby certify that this Resolution was adopted by the California Public Utilities Commission at its regular meeting on ______________. The following Commissioners approved it:

Rachel Peterson, Executive Director

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Original text here: https://docs.cpuc.ca.gov/PublishedDocs/Published/G000/M525/K127/525127604.pdf