Has the city of Dallas showed favoritism towards the Yellow Cab Co. versus the other cab & rideshare companies?
Even when ignoring the Uber controversy, recent news may leave you with serious questions.
Dallas-Fort Worth is quite a busy Metroplex, filled with people trying to commute from place to place. Therefore (as you can imagine), the use of taxis, buses, and rideshares are very popular in Dallas. Probably the most popular cab company in Dallas is the Yellow Cab Company.
Within the rules for the city of Dallas, it is stated that a cab company CANNOT act as its own insurance company — or in other words, a cab company cannot be self-insured. This helps to ensure that a taxi company cannot simply deny passengers’ car accident claims themselves in order to save money.
Yellow Cab Has Been Self-Insuring
Here is where calls of favoritism come into play. During an investigation, it was discovered that Yellow Cab is self-insured for the first $250,000 of its $500,000 policy. For ten (10) years, the Yellow Cab Company has been self-insuring its company, and the city of Dallas has allowed it!
Self-insuring saves them a lot of money, and could be what has allowed Yellow Cab to beat out its competition. Ambassador Cab was upset to hear that Yellow Cab self-insured because in 2011, Yellow Cab paid insurance premiums per car of approximately $650, while Ambassador Cab paid insurance premiums and deductibles per car of approximately $1,500. Ambassador Cab pays approximately 130 percent more for insurance than Yellow Cab does.
Of course members of other cab companies weren’t too happy to hear this, but heads turned when a Dallas City Council member also had something to say about the issue. These are thoughts form Dallas City Council member Sandy Greyson about why the Yellow Cab being able to self-insure is not fair and should be put to a stop. “People who self-insure versus paying for their insurance have an inherent advantage, and they can make a lot of money that other companies can’t because they have to spend it on their insurance premiums. We need a level playing field.”
Playing by the Rules?
Due to the unfair favoritism given to Yellow Cab by the city of Dallas, Dallas Interim City Manager, A.C. Gonzalez had given Yellow Cab 30 days to follow the standard rules for a cab company in the city of Dallas. As of 11/19/2013, Yellow Cab Co. has so far failed to convince Dallas officials that its taxis are legally insured, according to the city attorney’s office.