Philadelphia taxis carry much less insurance coverage than cabs in many other cities, providing less protection for passengers, pedestrians, or other motorists in case of accidents.
The minimum insurance requirement for taxis in Philadelphia and the rest of Pennsylvania is $15,000 per injured person and $30,000 for all people injured in any incident. That requirement, the same as for private motorists, has not changed since 1974.
It compares with minimums of $20,000 and $40,000 for taxis in Boston, $30,000 and $60,000 in Baltimore, $100,000 and $300,000 in New York City and Los Angeles, $350,000 in Chicago, and $500,000 in Dallas. Washington has lower insurance requirements than Philadelphia, at $10,000 and $20,000.
And victims of taxi accidents in Philadelphia often find it difficult to collect even the minimum amounts, as taxi insurers and risk-retention groups balk at paying, victims and their lawyers say.
That was the case for Tiffany Springman, 29, of Northeast Philadelphia, who was hurt in February 2012 when the taxi in which she was a passenger struck a utility pole on Frankford Avenue. Her hospital bills totaled $58,531 for surgery on her hip and other injuries.
Only after filing suit against Yellow Cab a year later was she able to collect $15,000, said Marc Simon, her lawyer.
Simon, who said he has handled about a thousand cases involving taxis in five years, blamed the "archaic and outdated limits," and added that "the whole system is set up to provide the minimum coverage possible."
The state of taxi insurance has drawn new attention as regulators and legislators face the arrival of ride-share services such as Uber and Lyft. The recent failure of a major insurer of Philadelphia taxis attracted additional scrutiny.
The emergence of Uber and other ride-share services "has raised some very good questions about insurance for all taxi services, whether they're part-time like Uber and Lyft or full-time regular taxis," said Samuel Marshall, president of the Insurance Federation of Pennsylvania.
In Harrisburg, State Sen. Vincent Hughes (D., Phila.) sponsored a bill to raise minimum insurance requirements for personal autos, and he said lawmakers also would need to examine taxis' insurance coverage when the legislature reconvenes next year.
"We're going to have to look at it all," Hughes said, noting that coverage limits "don't match up with reality anymore."
"If anyone is hurt, $15,000 barely covers anything," said Andrew Neuwirth, a personal-injury attorney in West Conshohocken who has represented victims of accidents involving taxis. "The injured people are getting screwed."
Richard Teitell, a personal-injury lawyer in Bala Cynwyd, criticized regulators such as the Philadelphia Parking Authority and the Pennsylvania Public Utility Commission for singling out Uber as lacking adequate insurance requirements.
"It seems hypocritical to me," Teitell said.
"If the PUC and PPA were really interested in proper insurance coverage, those mandatory minimum-coverage limits would be higher, and the processing and payment of amounts owed by the insurers would be more closely monitored," he said. "Although I think the PUC and PPA should make sure Uber customers are protected by adequate insurance, to me it's a pot-calling-the-kettle-black situation."
Everett Abitbol, co-owner of Freedom Taxi, which owns about 200 cabs, said the low insurance requirements are a symptom of problems hampering the Philadelphia taxi industry.
Abitbol said many of his competitors in the taxi business rely on cheap insurance from underfunded companies that prove unable to pay claims.
"If you have crap cars and crap service and lousy insurance, you're just creating a superhighway for Uber and Lyft and Sidecar," said Abitbol, who also owns cabs in New York, Chicago, and New Orleans.
One major insurer of Philadelphia taxis, First Keystone Risk Retention Group Inc., collapsed in insolvency last month. That prompted the Parking Authority to temporarily ground 478 of Philadelphia's 1,600 taxis until they found new insurance.
And it triggered the launch of the UberX ride-share service in Philadelphia in defiance of a ban by the PPA. Uber Technologies Inc. cited the "emergency" created by First Keystone's collapse for its move into Philadelphia on Oct. 24.
Marshall, of the Insurance Federation, said regulators and lawmakers should consider the costs of increasing coverage limits.
"You also need to weigh in how much that is going to increase my rates," he said. "There is a balance. I always want more coverage, but I don't have unlimited funds to pay for it."