Have you been injured in a taxi accident in Chicago?
While traveling by taxi may be unusual in the suburbs and in rural areas, taxis are a common sight in Chicago’s downtown business district. Further, the Chicago taxicab accident lawyers at our office are well aware that collisions involving these vehicles are common as well.
Taxi cab service is a government-controlled trade within the City of Chicago. The supply of taxis is regulated very strictly through the issuance of city-authorized taxi medallions.
There are almost 7,000 Chicago taxi medallions. These official, numbered, metal license plaques are affixed to the top right hood of the vehicles being operated as cabs.
Taxi medallions in the not so distant past were a valuable investment. The average sales price of a single medallion was averaging around $340,000 as of 2013. However, with the arrival of Uber and Lyft, there are estimates that the value is now down around $30,000.
Taxi Liability Insurance Coverage in Chicago
Trying to recover from a taxi driver or cab company whose driver has caused an injury can be extremely difficult. Even worse, despite the degree of control the Chicago city government exercises with respect to carrying on the cab trade, the City of Chicago has done very little to protect parties injured in accidents caused by taxi operators. Finally, taxicab insurance carriers are notoriously difficult to deal with on claims.
However, there is one bright spot. Under Chicago ordinances, taxicabs are required to carry automobile liability insurance limits of $350,000. This ordinance also applies to limousine services.
This is not as much insurance as you would hope to cover a business, however it is greater than your average auto insurance policy.
$350,000 is sufficient to cover damages in many accidents, but sometimes it’s still inadequate. This is particularly true in accidents with pedestrian and bicycle collisions, where personal injury damages are likely to be significant.
In particular, pedestrians with serious injuries due to negligent taxi drivers have found it difficult to recover damages caused by cab drivers cab companies. This is especially disturbing when you stop to consider that in downtown Chicago, in one recent year more than one out of every four pedestrian crashes involved a taxi.
Injuries from Taxi Cab Accidents
Taxis are notorious for driving aggressively, and Chicago is no exception. Cab drivers can maximize their revenues by carrying more fares. To do this, they often speed during each journey to fit as many fares as possible into a given work day.
They will also work extended hours in order to take more fares. Further, in Illinois, cab passengers riding in the rear seat are exempted from Illinois seat belt laws.
Cabs are susceptible to the same types of accidents as any other vehicle. Further, cab drivers, cab passengers, and pedestrians are subject to the same types of injuries.
However, in addition to the normal risks associated with driving, cabbies have financial incentives to drive more recklessly. Also, unbelted passengers can slam into partitions or otherwise be thrown around the interior of the vehicle in the event of an accident.
When you factor in aggressive driving, speeding, traffic, pedestrians, and tired drivers, the result is that numerous accidents involving taxicabs are bound to happen. Also, as our taxicab crash attorneys know too well, these collisions will inevitably result in some very serious injuries.
Accident Claims Against a Taxi Driver or Cab Company Can be Difficult
The Chicago Sun-Times once published an article entitled, “Badly Injured in a Cab Crash? Good Luck Collecting Much.” The article was about accident and injury victims trying to seek compensation from Chicago cabbies. It was discouraging, to say the least.
As noted above, taxicabs are in many accidents and, often, it is the cab drivers who are at fault. Unfortunately, many people do not think twice about climbing into the back of a cab. And, it is not surprising to see taxi drivers recklessly speeding by.
They also may believe that taxi companies will behave responsibly if something goes wrong. After all, they are all required to carry minimum insurance, and they are part of large, profitable concerns, so they should be able easily to shoulder the costs of any damages they cause, shouldn’t they?
Cab Companies Attempt to Shelter Assets
As the Chicago Sun-Times article points out, the answer is not that simple. Unfortunately, many taxi companies have become experts at protecting their assets. And further, at protecting themselves from paying out insurance claims.
How? Well, one way is by creating multiple corporate sub-entities. This, with the intent to virtually guarantee that there are few assets that can be reached by injured parties after an accident.
For example, the corporate owner of multiple taxi medallions may create a separate corporation. Or, many separate small corporations. The corporations then turn around and lease the medallions out to individual cab drivers.
The leasing companies then treat individual cab drivers as “independent businessmen”. On paper they have no direct employment connection to the leasing company, let alone to the company that actually owns the medallions.
When an accident occurs, these companies treat the cabbies as if they are on their own. Further, these cabbies often have almost no assets that will allow injured parties to recover amounts that exceed insurance limits.
And let’s say a plaintiff can get to the next level above the cabbie, the leasing company. He may find that that particular sub-entity only operates three or four cabs. Further, it does not itself own any of the valuable medallions.
Also, the companies that own the medallions may use the medallions as collateral for loans. This leaves the medallions themselves so saddled with debt that they are almost worthless assets in themselves.
At most, accident victims may only be able to recover from the insurance companies. Meaning, the total amount of compensation available is $350,000. While this is more insurance than most people purchase, it is hardly sufficient when an accident causes a permanent injury or causes a person to become unable to earn an income.
Abels & Annes Represents Those Injured in Taxi Cab Accidents
It’s like a “shell game” some cab companies are playing. It’s no wonder that accident victims of negligent Chicago cab drivers sometimes find themselves getting nowhere.
It can be overwhelming when they try to pursue compensation for their injuries from cab companies. Many people simply give up, or settle for a small fraction of the damages to which they should receive.
That is why it is critical to work with a taxi accident attorney in Chicago if in an accident with a cab driver. A lawyer can help guide you, handle the insurance carrier, while letting you focus on recovering from your injuries.
The injury attorneys at Abels & Annes know how the cab companies operate. These businesses shouldn’t make enormous profits from a taxi businesses without paying for the damages they cause in auto accidents. We do our best to hold these businesses accountable when they cause harm to individuals.
Contact a Chicago Taxicab Accident Lawyer
If you sustain injuries from an accident caused by a Chicago taxicab driver, you are likely to get nowhere on your own. You need the assistance of a qualified and experienced car accident attorney.