THE SENATE

S.B. NO.

495

TWENTY-SEVENTH LEGISLATURE, 2013

S.D. 2

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT

 

 

RELATING TO INSURANCE.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


PART I

     SECTION 1.  (a)  There is established a working group to assist in the development of a program to identify uninsured motor vehicles in the State using web-based technology.  The working group shall be attached to the department of commerce and consumer affairs for administrative purposes.

     (b)  The purpose of the working group, as described in subsection (c), shall be to provide recommendations regarding:

     (1)  The development of a request for proposals from qualified vendors to perform all services necessary to develop and operate the motor vehicle insurance verification program; provided that the program shall include the following:

         (A)  Adherence to established industry standards for real-time automotive liability insurance verifications, as prescribed by the Insurance Industry Committee on Motor Vehicle Administration;

         (B)  Sending of notification letters to uninsured motorists, specifically targeting repeat offenders, with additional checks;

         (C)  Providing for suspension of motor vehicle registration upon failure to respond to notification letters; and

         (D)  Implementation of the program by January 1, 2015;

     (2)  The selection of a qualified vendor;

     (3)  Ways to exclude commercial vehicles from the motor vehicle insurance verification program;

     (4)  Providing for an alternative means for small insurers to fulfill reporting requirements; and

     (5)  Appropriate benchmarking criteria and reporting requirements to determine program efficacy and measure the proportion of uninsured motor vehicles to insured motor vehicles.

     (c)  The working group shall comprise the following members or the members' designee:

     (1)  The insurance commissioner;

     (2)  The deputy chief court administrator of the district court of the first circuit;

     (3)  The court administrator of the traffic violations bureau of the district court of the first circuit;

     (4)  The administrator of the motor vehicle and licensing division of the city and county of Honolulu;

     (5)  A representative of the Honolulu police department, traffic division;

     (6)  A representative of the Hawaii Insurers Council;

     (7)  A representative of the Property Casualty Insurers Association of America;

     (8)  A representative of the department of information technology of the city and county of Honolulu;

     (9)  A representative of the commerce and economic development division of the department of the attorney general; and

    (10)  Other members, as deemed appropriate by the chair of the working group.

The insurance commissioner shall serve as chair of the working group.

     (d)  The working group shall cease to exist on January 1, 2015.

PART II

     SECTION 2The Hawaii Revised Statutes is amended by adding a new section to be appropriately designated and to read as follows:

     "§   -A  Motor vehicle insurance verification program.  (a)  The department of commerce and consumer affairs shall develop and operate a program to identify uninsured motor vehicles in the State.

     (b)  The allocated portion of motor vehicle registration fees provided for by section 249-31 shall be deposited by the director of finance, as defined in section 249-1, to the credit of the compliance resolution fund established pursuant to section 26‑9(o).  The allocated portion of fines provided for by section 431:10C-117 shall be deposited into the general fund."

     SECTION 3.  Section 249-31, Hawaii Revised Statutes, is amended to read as follows:

     "§249-31  State registration fee.  (a)  All vehicles and motor vehicles in the State as defined in section 249-1, including antique motor vehicles, except as otherwise provided in sections 249-4 and 249-6, shall be subject to a [$45] $           annual vehicle registration fee.  The fee shall be paid each year together with all other taxes and fees levied by this chapter on a staggered basis as established by each county as authorized by section 286-51, and the state registration for that county shall likewise be staggered so that the state registration fee is due and payable at the same time and shall be collected together with the county fee.  The state registration fee shall be deemed delinquent if not paid with the county registration fee.  The respective counties shall collect this fee together with the vehicle registration tax collected for the county and shall transfer the moneys collected under this section to the State.

     (b)  From each annual motor vehicle registration fee, the director shall deposit $40 into the state highway fund [and], $5 into the emergency medical services special fund[.], and $           into the compliance resolution fund."

     SECTION 4.  Section 431:10C-117, Hawaii Revised Statutes, is amended by amending subsection (a) to read as follows:

     "(a) (1)  Any person subject to this article in the capacity of the operator, owner, or registrant of a motor vehicle operated in this State, or registered in this State, who violates any applicable provision of this article, shall be subject to citation for the violation by any county police department in a form and manner approved by the traffic violations bureau of the district court of the first circuit;

     (2)  Notwithstanding any provision of the Hawaii Penal Code:

         (A)  Each violation shall be deemed a separate offense and shall be subject to a fine of not less than $100 nor more than $5,000 which shall not be suspended except as provided in subparagraph (B); and

         (B)  If the person is convicted of not having had a motor vehicle insurance policy in effect at the time the citation was issued, the fine shall be $500 for the first offense and a minimum of $1,500 for each subsequent offense that occurs within a five-year period from any prior offense; provided that the judge:

              (i)  Shall have the discretion to suspend all or any portion of the fine if the defendant provides proof of having a current motor vehicle insurance policy; provided further that upon the defendant's request, the judge may grant community service in lieu of the fine, of not less than seventy-five hours and not more than one hundred hours for the first offense, and not less than two hundred hours nor more than two hundred seventy-five hours for the second offense; and

             (ii)  May grant community service in lieu of the fine for subsequent offenses at the judge's discretion;

     (3)  In addition to the fine in paragraph (2), the court shall either:

         (A)  Suspend the driver's license of the driver or of the registered owner for:

              (i)  Three months for the first conviction; and

             (ii)  One year for any subsequent offense within a five-year period from a previous offense;

              provided that the driver or the registered owner shall not be required to obtain proof of financial responsibility pursuant to section 287‑20; or

         (B)  Require the driver or the registered owner to keep a nonrefundable motor vehicle insurance policy in force for six months;

     (4)  Any person cited under this section shall have an opportunity to present a good faith defense, including but not limited to lack of knowledge or proof of insurance.  The general penalty provision of this section shall not apply to:

         (A)  Any operator of a motor vehicle owned by another person if the operator's own insurance covers such driving;

         (B)  Any operator of a motor vehicle owned by that person's employer during the normal scope of that person's employment; or

         (C)  Any operator of a borrowed motor vehicle if the operator holds a reasonable belief that the subject vehicle is insured;

     (5)  In the case of multiple convictions for driving without a valid motor vehicle insurance policy within a five-year period from any prior offense, the court, in addition to any other penalty, shall impose the following penalties:

         (A)  Imprisonment of not more than thirty days;

         (B)  Suspension or revocation of the motor vehicle registration plates of the vehicle involved;

         (C)  Impoundment, or impoundment and sale, of the motor vehicle for the costs of storage and other charges incident to seizure of the vehicle, or any other cost involved pursuant to section 431:10C-301; or

         (D)  Any combination of those penalties; [and]

     (6)  Any violation as provided in subsection (a)(2)(B) shall not be deemed to be a traffic infraction as defined by chapter 291D[.]; and

     (7)  $           of any fine imposed under this subsection shall be deposited into the general fund."

PART III

     SECTION 5.  Section 286-26, Hawaii Revised Statutes, is amended to read as follows:

     "§286-26  Certificates of inspection.  (a)  The following vehicles shall be certified as provided in subsection (e) once every year:

     (1)  Trucks, truck-tractors, semitrailers, and pole trailers having a gross vehicle weight rating of more than 10,000 pounds;

     (2)  Buses;

     (3)  Rental or U-drive motor vehicles two years of age or older; and

     (4)  Taxicabs.

Ambulances shall be certified as provided in subsection (e) once every six months.

     (b)  All other vehicles, including motorcycles, trailers, semitrailers, and pole trailers having a gross vehicle weight rating of 10,000 pounds or less, and antique motor vehicles as defined in section 249-1, except those in subsections (c) and (d), shall be certified as provided in subsection (e) every twelve months; provided that any vehicle to which this subsection applies shall not require inspection within two years of the date on which the vehicle was first sold.

     (c)  Any vehicle that has been involved in an accident shall be certified as provided in subsection (e) before it is operated again if:

     (1)  It is determined by a police officer or an insurer that the vehicle's equipment has been damaged so as to render the vehicle unsafe; or

     (2)  It is rebuilt or restored.

     (d)  Every vehicle shall be certified prior to the issuance of a temporary or permanent registration by the director of finance and prior to the transfer of any registration; provided that this requirement shall not apply to a subsequent transfer of registration in a vehicle that carries a current certificate of inspection.

     (e)  Upon application for a certificate of inspection to be issued for a vehicle, an inspection as prescribed by the director under subsection (g) shall be conducted on the vehicle, and if the vehicle is found to be in a safe operating condition, a certificate of inspection shall be issued upon payment of a fee to be determined by the director.  [The certificate shall state the effective date, the termination date, the name of the issuing insurance carrier, and the policy number of the motor vehicle insurance identification card for the inspected motor vehicle as specified by section 431:10C-107 or state the information contained in the proof of insurance card as specified by section 431:10G-106.]  A sticker, authorized by the director, shall be affixed to the vehicle at the time a certificate of inspection is issued.  An inspection sticker which has been lost, stolen, or destroyed shall be replaced without reinspection by the inspection station that issued the original inspection sticker upon presentation of the vehicle's current certificate of inspection; provided that the current certificate of inspection and inspection sticker shall not have expired at the time the replacement is requested.  The director shall adopt rules to determine the fee for replacement of lost, stolen, or destroyed inspection stickers.

     (f)  The operator of an official inspection station shall pay, from the fee in subsection (e), an amount to be determined by rules adopted pursuant to chapter 91 to the director of transportation.  This amount shall be expended only for administration and enforcement of the periodic motor vehicle inspection program.  The funds collected pursuant to this subsection shall be deposited into the highway special fund.

     (g)  The director of transportation shall adopt necessary rules for the administration of inspections and the issuance of certificates of inspection.

     (h)  This section shall not apply to:

     (1)  Any motor vehicle which is covered by part XI, governing safety of motor carrier vehicle operation and equipment; provided that the rules adopted pursuant to part IA impose standards of inspection at least as strict as those imposed under subsection (g) and that certification is required at least as often as provided in subsections (a), (b), (c), and (d); and

     (2)  Aircraft servicing vehicles that are being used exclusively on lands set aside to the department of transportation for airport purposes.

     [(i)  As part of the inspection required by this section, the owner of the vehicle to be inspected shall produce and display the motor vehicle insurance identification card for the inspected motor vehicle required by section 431:10C-107 or the proof of insurance card required by section 431:10G-106.  If no card is displayed, then the sticker authorized by the director shall not be affixed to the vehicle and the certificate of inspection shall not be issued.]"

     SECTION 6.  Section 286-108, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

     "(d)  As part of the examination required by this section, [the applicant for a driver's license shall produce and display a valid motor vehicle or liability insurance identification card for the motor vehicle required by sections 431:10C-107 and 431:10G-106, when the applicant demonstrates the ability to operate a motor vehicle to the satisfaction of the examiner of drivers.  If no valid motor vehicle or liability insurance identification card is displayed, the examiner of drivers shall not issue a driver's license to the applicant.] the examiner of drivers shall confirm that the vehicle to be used by the applicant to demonstrate the ability to operate a motor vehicle is insured via the motor vehicle insurance verification program established under section     -A.  If the motor vehicle insurance verification program indicates that the vehicle is not insured, the examiner of drivers shall not permit the applicant to use the uninsured vehicle to demonstrate the ability to operate a motor vehicle."

     SECTION 7.  Section 431:10C-107, Hawaii Revised Statutes, is amended to read as follows:

     "§431:10C-107  Verification of insurance:  motor vehicles.  (a)  Every insurer shall issue to its insureds a motor vehicle insurance identification card for each motor vehicle for which the basic motor vehicle insurance coverage is written.  The identification card shall contain the following:

     (1)  Name of make and factory or serial number of the motor vehicle; provided that insurers of five or more motor vehicles which are under common registered ownership and used in the regular course of business shall not be required to indicate the name of make and the factory or serial number of each motor vehicle;

     (2)  Policy number;

     (3)  Names of the insured and the insurer; and

     (4)  Effective dates of coverage including the expiration date.

     (b)  The identification card shall be in the insured motor vehicle at all times and shall be exhibited to a law enforcement officer upon demand.

     [(c)  The identification card shall be resistant to forgery by whatever means appropriate.  The commissioner shall approve the construction, form, and design of the identification card to ensure that the card is forgery resistant.

     (d)] (c)  The commissioner shall issue a certificate of self-insurance periodically, as necessary, for use in each motor vehicle insured under section 431:10C-105.

     [(e)] (d)  The identification card issued by an insurer shall not be issued for a period exceeding the period for which premiums have been paid or earned; provided that this subsection shall apply only to the first application of a person for a motor vehicle insurance policy and shall not apply to applications for commercial vehicles and fleet vehicles."

     SECTION 8.  Section 805-13, Hawaii Revised Statutes, is amended by amending subsection (d) to read as follows:

     "(d)  Upon subsequent hearing ordered by the court or upon the driver's or registered owner's motion, the court may, in its discretion, terminate any judgment previously entered under subsection (c) upon finding that the registered owner and the driver, as applicable, have complied with chapter 287 with respect to any prior accident as evidenced by a form properly validated by a police department and:

     (1)  Complied with all requirements under chapter 431:10C as evidenced by a motor vehicle insurance identification card and the insurance policy issued by a licensed insurer; or

     (2)  Complied with all requirements under chapter 431:10C as evidenced by a certificate of self-insurance issued by the insurance commissioner pursuant to section [431:10C-107(d).] 431:10C-107(c)."

PART IV

     SECTION 9.  In codifying the new section added by section 2 of this Act, the revisor of statutes shall substitute an appropriate section number for the letter used in designating the new section in this Act.

     SECTION 10.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 11.  This Act shall take effect on July 1, 2050; provided that:

     (1)  Part III shall take effect on January 1, 2015; and

     (2)  This Act shall be repealed on June 30, 2020, and sections 249-31, 286-26, 286-108(d), 431:10C-107, 431:10C-117(a), and 805-13(d), Hawaii Revised Statutes, shall be reenacted in the form in which they read on the day before the effective date of this Act.


 


 

Report Title:

Insurance Verification Working Group; Motor Vehicle Insurance; Uninsured Motorists; Department of Commerce and Consumer Affairs

 

Description:

Implements the recommendations of the motor vehicle insurance verification working group.  Establishes a working group attached to DCCA to assist in development of requests for proposals and vendor selection for a motor vehicle insurance verification program.  Increases annual motor vehicle registration fee.  Removes duplicative and unnecessary requirements for insurance identification cards and safety inspection requirements.  Requires the allocated portion of motor vehicle registration fees to be deposited to the credit of the compliance resolution fund and the allocated portion of fines to be deposited into the general fund.  Effective 07/01/2050.  Sunsets 06/30/2020.  (SD2)

 

 

 

The summary description of legislation appearing on this page is for informational purposes only and is not legislation or evidence of legislative intent.