Risk Management and Liability Flashcards

A taxi driver notices the brakes feel soft before starting a shift. The safest and legally correct action is to:

Answer: Inform dispatch and remove the vehicle from service until inspected

Operating a vehicle with a known mechanical defect is negligent; the vehicle must be taken out of service immediately to prevent accidents and liability.

Which document is essential for a taxi driver to carry at all times to limit liability exposure during a traffic stop or accident?

Answer: Proof of commercial insurance, driver's license, and vehicle registration

Commercial insurance proof, a valid license, and registration are legally required and demonstrate compliance, protecting the driver in any stop or incident.

A passenger verbally threatens the driver during a trip. What risk management step should the driver take FIRST?

Answer: Stop the vehicle immediately in the nearest safe location and contact dispatch/police

Stopping safely and contacting authorities is the correct first step to de-escalate the situation and create an official record of the threat.

What is the primary purpose of a 'hold harmless' clause that some taxi companies include in driver contracts?

Answer: To shift liability from the company to the driver for certain claims

Hold harmless clauses contractually transfer liability to the driver, meaning the company may not be responsible for claims arising from the driver's conduct.

Under FTC and state consumer protection rules, a taxi driver who uses a rigged meter that overcharges passengers faces:

Answer: Criminal fraud charges, license revocation, and civil liability

Deliberately overcharging passengers with a tampered meter constitutes fraud, which can lead to criminal prosecution, loss of licensure, and civil lawsuits.

How does maintaining a clean driving record directly benefit a taxi driver's risk management posture?

Answer: It keeps insurance premiums lower and demonstrates a history of safe operation

A clean record signals low risk to insurers, resulting in lower premiums, and supports the driver's credibility if a liability dispute arises.

A driver knowingly picks up a passenger who appears intoxicated and that passenger injures a bystander. Which liability concept MOST applies to the driver?

Answer: Contributory negligence for knowingly transporting a foreseeable risk

A driver who knowingly creates a foreseeable risk by transporting a visibly dangerous passenger may share liability for resulting harm through contributory negligence.