Dallas mayor pledges to resolve taxi insurance problem

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by DAVID SCHECHTER

Bio | Email | Follow: @davidschechter

WFAA

Posted on November 11, 2013 at 11:29 PM

Updated Tuesday, Nov 12 at 12:31 AM

NEWS 8 INVESTIGATES

DALLAS — There are more than 800 Yellow Cabs in the Dallas area, allegedly driving around without the insurance coverage required by the City of Dallas to protect injured passengers. That’s what a News 8 investigation found.

In response, the City of Dallas says it will fix the problem within 30 days.

Mayor Mike Rawlings said 30 days is enough time, despite the fact that Yellow — the biggest company around — sometimes uses hard-nosed tactics to deny the claims of injured people.

Under city rules designed to protect customers, all claims are to be handled by insurance companies — not the cab companies.

In an interview Monday, Dallas Mayor Mike Rawlings was asked if the city is putting passengers at risk by letting Yellow continue to operate without the required insurance coverage.

“We’re going to work through every one of those details,” Rawlings said.

In Dallas, cab companies are required to carry $500,000 worth of insurance. Every dollar of an injury claim must be paid through an insurance policy — not by the cab company. There is no self-insurance allowed.

The rule is supposed to eliminate the temptation for a cab company to save its cash by denying legitimate injury claims.

But unlike every other licensed cab company in the city, records obtained by News 8 show Yellow is self-insured up to $250,000. This effectively turns Yellow from a cab company into it’s own insurance company.

In January, a taxi operated by the parent company of Yellow Cab plowed through a red light, totaling the car of Mel Stockwell. “They’ve been threatening. They’ve been abusive,” Stockwell said.

Yellow paid for his car to be replaced. But Stockwell said Yellow refused to reimburse for cab expenses he incurred while without his car, and $48,000 in medical bills and lost wages.

Stockwell went to discuss his medical bills with Jeff Finkel, one of the owners and managers of Yellow Cab. Stockwell made this audio recording of Finkel's response:

“I tell you what. We made an offer. You can accept the offer or get an attorney. But we are done, sir. We provided your car instantly. And you want us to pay for cabs also? You’re being ludicrous. You have a good day. I need to ask you to leave my property.”

Ten months later, Stockwell said Yellow has not paid his medical claims

“I think citizens should know that,” Mayor Rawlings said about Yellow’s reliance on self-insurance to pay claims. “They’ll have 30 days to get into compliance as far as we’re concerned.

The city said the situation emerged because of reliance on a 2003 City Hall memo obtained by News 8 through an open records request. It’s a status report for City Council members, updating the state of taxicab insurance requirements.

On the line about “self-insurance” it says “allowed” when it should have said “not allowed."  It’s an obvious mistake in direct conflict with city ordinance in a document with no legal significance.

“I want to make sure all the ordinances in the City of Dallas are in place. And we must review the reviewer at times, and I don’t think that happened in this case,” Rawlings said.

An attorney for Yellow tells News 8 the company is in compliance with the insurance ordinance, and believes it is allowed to self-insure. Yellow does have an insurance policy that covers claims above the $250,000 level. The attorney was not familiar with Stockwell's injury claim.

E-mail dschechter@wfaa.com

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