Is Uber’s Insurance Inferior To Big Taxi’s Insurance? No. They are all lying.

Here’s an excerpt detailing the HORROR of Big Taxi’s insurance from the Part 2 of the Boston Globe Spotlight team’s expose of the taxi industry beginning in March 2013.

The movie Spotlight profiled the team’s work on the sex abuse scandal. The taxi series resulted in a federal investigation of Eddie Tutunjian owner of 372 medallions – 21% of all of Boston’s.

“…Each accident happened in an instant. Elizabeth Rideout was standing on the sidewalk at Logan Airport, fresh from a Florida vacation, when a taxi hurtling out of control jumped the curb and plowed into her and a fellow traveler.

Michael Metcalf, a Massachusetts Turnpike Authority worker, sat in a parked tow truck in the Callahan Tunnel, his emergency lights flashing. Suddenly, a cab struck it from behind with a powerful jolt.

Marijke Rijsberman and her 19-year-old daughter were riding in a taxi to the Isabella Stewart Gardner Museum. The cabbie lost control and drove into a guardrail, hurling them face-first into the plexiglass divider.

The results of the accidents, which occurred over a span of six years, varied: One person killed, another left in a coma for 18 days, two suffering facial and dental injuries, and one severe back problems.

But all three accidents shared a common denominator: Boston Cab.

Owned by Edward J. Tutunjian, Boston Cab has by far the biggest taxi fleet in the city, controlling 1 in 5 of the 1,825 licensed taxis. With taxi licenses, or medallions, worth more than $220 million, he has the deepest pockets in the taxi trade and the largest potential legal exposure as his trademark brown-and-white cabs zip around town.

But when it comes to insurance claims, the game is rigged in favor of Tutunjian and some other taxi fleet owners — and against accident victims. The Spotlight Team reviewed scores of personal injury claims against Tutunjian and his cabs and found that, as is the case with so much else in the world of Boston’s cab industry, financial priorities are upside down. The owner’s interests are zealously protected. The passenger and the public come last.

For one thing, Tutunjian and most other taxi owners buy far too little insurance to cover serious injuries.

The three cabs involved in the accidents, like about 80 percent of the other taxis in Massachusetts, were operating with the state minimum bodily injury coverage of $20,000. That’s a fraction of what most motorists buy for their own cars, even though, according to the state Division of Insurance, cabs have seven times the accident rate of ordinary vehicles.

That coverage is less than half the $50,000 required of bicycle messenger services in Boston. It’s also a tiny percentage of the $1 million coverage mandated at Logan International Airport for unmarked black cars known as livery vehicles.

And it’s allowed because the Legislature has repeatedly ignored proposals to mandate more insurance for taxis.

Mark Jenkins, a Peabody software entrepreneur whose girlfriend suffered a permanent brain injury in a 1994 accident with a Revere taxi that had only $20,000 in coverage, said he has testified at the State House four times since 2001 in favor of raising the minimum required cab insurance.

Legislators “seem just as flabbergasted as I was by the whole thing,” Jenkins said. “But then it’s, ‘Thank you for showing up. Have a nice day.’ ’’

Tutunjian takes this unlevel playing field and tilts it even further in his favor. Relying on a little-used provision of state law, he self-insures his cabs by depositing money in interest-bearing state accounts to cover his fleet, instead of paying premiums.

Like many other fleet owners in Boston and elsewhere, he also divvies up his 372 valuable taxi medallions into dozens of corporations, which makes some potential litigants think that a cab in an accident belongs to a small business with modest assets rather than a transportation giant.

In addition, Tutunjian denies any responsibility for the errors or negligence of the people who drive his taxis, because he and other fleet owners consider cabbies “independent contractors’’ rather than employees.

“He leases a cab to be independent, be his own boss, go make money on streets,” Tutunjian testified of drivers in a deposition in February. He added, “I have no control [over] what they do.’’

The result of all this is plain: Accountability is minimized. People injured in or by a Boston Cab face a forbidding legal thicket. People like Marion Rideout and her mom.

Rideout, whose 68-year-old mother was trapped under the rear axle of the taxi at Logan International Airport in 2003 and spent eight months hospitalized, said the company initially offered her family $8,000, then grudgingly increased the offer to no more than $20,000 to cover Elizabeth Rideout’s massive injuries.

“I said, ‘Twenty thousand dollars? My mother’s in a coma at the [intensive care unit] at Mass. General,’ ’’ recalled Rideout. “And they said, ‘Well, that’s all we’re liable for.’ ’’

But unlike some accident victims who accept a woefully insufficient insurance payout, Marion Rideout refused to take “that’s all” as a final answer. She joined battle with Tutunjian — a battle that would continue for two nightmarish years.

In her desperation and determination, she has some company — others who refused to accept the company’s terms and went to court to fight Boston Cab. Among them:

The family of Anna Makrokanis, a 79-year-old woman who was killed getting out of a Boston Cab taxi in 1997 when the driver allegedly took his foot off the brake.

Mariano C. Lozano, a taxi driver who lost both his legs when the Boston Cab taxi behind him in line at Logan rolled into him, also in 1997.

Daniel Fitzgerald, a Boston police officer who allegedly suffered neck and back injuries when a Boston Cab taxi struck him while he was directing rush-hour traffic in the Financial District in 2009. The cabbie said his foot slipped from the brake onto the gas pedal. A trial is scheduled for May.

Dr. Merton Bernfield, who said he had his hand on a Boston Cab taxi as he spoke to the driver outside Children’s Hospital in 2001. When the driver sped away, Bernfield alleged, he fell and dislocated his shoulder. The 62-year-old professor of pediatrics and cell biology at Harvard Medical School had Parkinson’s disease, and his widow believes the fall led to a cascade of medical setbacks that hastened his death 13 months later.

It is legal and common for business owners to form corporations to limit their liability, but lawyers for accident victims contend that Tutunjian exploits corporate protections to put his assets out of reach. They say he uses the power of his deep-pocketed corporations to solicit riders and attract taxi drivers, then denies those corporations have anything to do with his small medallion-owning companies when a cab is involved in an accident…”

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