By Gutierrez, West, Cuellar, Thompson, H.B. No. 2793
76R8833 WP-F
A BILL TO BE ENTITLED
1-1 AN ACT
1-2 relating to motor vehicle insurance verification and creating the
1-3 motor vehicle insurance verification program; providing
1-4 administrative and criminal penalties.
1-5 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
1-6 SECTION 1. Chapter 601, Transportation Code, is amended by
1-7 adding Subchapter N to read as follows:
1-8 SUBCHAPTER N. MOTOR VEHICLE INSURANCE VERIFICATION PROGRAM;
1-9 INSURER REPORTING
1-10 Sec. 601.440. DEFINITIONS. In this subchapter:
1-11 (1) "Database" means the motor vehicle insurance
1-12 verification database established under this subchapter.
1-13 (2) "Designated agent" means a third party
1-14 administering the program under contract with the department.
1-15 (3) "Program" means the Motor Vehicle Insurance
1-16 Verification Program established under this subchapter.
1-17 Sec. 601.441. ESTABLISHMENT OF PROGRAM. (a) The department
1-18 shall establish the Motor Vehicle Insurance Verification Program to
1-19 verify compliance with this chapter.
1-20 (b) The department by rule shall administer the program with
1-21 the assistance of a designated agent.
1-22 (c) The program must comply with the Driver's Privacy
1-23 Protection Act of 1994 (18 U.S.C. Section 2721 et seq.).
1-24 Sec. 601.442. DESIGNATED AGENT; MAINTENANCE OF DATABASE.
2-1 (a) The department shall contract with a third party to act as the
2-2 department's designated agent under this subchapter. The contract
2-3 may be awarded under a competitive bid procedure as provided by
2-4 department rule. The contract may not obligate the department to
2-5 pay more money than is determined by the public safety director
2-6 from fees collected under Section 502.1715.
2-7 (b) The designated agent shall develop and maintain a
2-8 computer database to manage and provide access to information
2-9 provided under Sections 601.444, 601.445, and 601.446.
2-10 (c) The database shall be developed, maintained, and
2-11 administered in accordance with guidelines established by the
2-12 department to permit efficient access by courts and state and local
2-13 law enforcement agencies.
2-14 Sec. 601.443. VERIFICATION; NOTICE FOR NONCOMPLIANCE.
2-15 (a) With information provided by the department and the Texas
2-16 Department of Transportation, the designated agent shall, at least
2-17 monthly:
2-18 (1) update the database with the motor vehicle
2-19 insurance information provided by insurers under Section 601.444;
2-20 and
2-21 (2) compare all current motor vehicle registrations
2-22 provided by the Texas Department of Transportation against the
2-23 database.
2-24 (b) If a comparison under this section shows that a motor
2-25 vehicle is not insured, the department may direct that the
2-26 designated agent mail a notice to the owner of the motor vehicle
2-27 stating that the owner has 45 days to provide:
3-1 (1) proof of the owner's financial responsibility in a
3-2 form described by Section 601.053;
3-3 (2) a letter from an insurance agent or company
3-4 verifying that the person had the required motor vehicle insurance
3-5 coverage on the date of action specified by the database query;
3-6 (3) proof of an exemption from the owner's financial
3-7 responsibility under Section 601.052; or
3-8 (4) proof that the owner of the motor vehicle is
3-9 insured by an insurance company located in another state because
3-10 the owner is a member of the United States armed forces, a student
3-11 attending an educational institution in this state and residing in
3-12 this state, or a faculty member of an educational institution in
3-13 this state who is residing in this state.
3-14 (c) If an owner of a motor vehicle has not provided proof of
3-15 financial responsibility to the designated agent by the 45th day
3-16 after the date the notice is sent, the department may direct the
3-17 designated agent to provide an additional notice.
3-18 Sec. 601.444. INFORMATION PROVIDED BY INSURANCE COMPANY.
3-19 (a) Each insurance company providing motor vehicle liability
3-20 policies in this state shall provide the designated agent a record
3-21 of each motor vehicle insurance policy, including:
3-22 (1) the insurance policy number, effective date, and
3-23 expiration date of the policy;
3-24 (2) the name, address, date of birth, and driver's
3-25 license number of each driver insured by the policy; and
3-26 (3) the make, model, year, and vehicle identification
3-27 number of each vehicle covered by the policy.
4-1 (b) Each insurance company shall provide information
4-2 required by Subsection (a) to the designated agent in an electronic
4-3 submission monthly or more frequently as prescribed by the public
4-4 safety director.
4-5 (c) If information provided by an insurance company to the
4-6 designated agent is incorrect, the insurance company shall provide
4-7 corrected information to the designated agent in a timely manner as
4-8 prescribed by the public safety director after the date the
4-9 insurance company receives notice of the error from the designated
4-10 agent.
4-11 (d) Information provided by an insurance company under this
4-12 section remains the property of the insurance company and may not
4-13 be sold or made available except to enforce a state law.
4-14 Sec. 601.445. INFORMATION PROVIDED BY DEPARTMENT. (a) The
4-15 department shall provide the designated agent the following
4-16 information on each Texas driver's license holder:
4-17 (1) the holder's name, address, and date of birth; and
4-18 (2) the driver's license number and expiration date.
4-19 (b) For each motor vehicle covered by a bond filed under
4-20 Section 601.121, a deposit made under Section 601.123, or a
4-21 certificate of self-insurance issued under Section 601.124, the
4-22 department shall provide to the designated agent:
4-23 (1) the owner's name, address, and date of birth; and
4-24 (2) the owner's driver's license number and expiration
4-25 date.
4-26 (c) The department shall notify the designated agent of:
4-27 (1) the cancellation of a bond filed under Section
5-1 601.121;
5-2 (2) the cancellation of a deposit filed under Section
5-3 601.123; or
5-4 (3) the termination of a certificate of self-insurance
5-5 issued under Section 601.124.
5-6 (d) This section does not require the department to provide
5-7 to the designated agent information that is not in the possession
5-8 of the department.
5-9 (e) The department shall provide the information under this
5-10 section in an electronic submission to the designated agent in a
5-11 timely manner as prescribed by the public safety director.
5-12 (f) The department is not liable to any person for damages
5-13 arising as a result of providing information as required by this
5-14 section.
5-15 Sec. 601.446. INFORMATION PROVIDED BY TEXAS DEPARTMENT OF
5-16 TRANSPORTATION. (a) The Texas Department of Transportation shall
5-17 provide the department or its designated agent the following
5-18 information for each vehicle to which this chapter applies, to the
5-19 extent the information is in the Texas Department of
5-20 Transportation's records:
5-21 (1) the owner's name and address;
5-22 (2) the make, model, and year of the vehicle;
5-23 (3) the vehicle identification number and vehicle
5-24 license plate number; and
5-25 (4) the date the certificate of title was issued for
5-26 the vehicle.
5-27 (b) The Texas Department of Transportation is not required
6-1 to provide information under this section about a vehicle
6-2 registered under Subchapter G, Chapter 502.
6-3 (c) The Texas Department of Transportation shall provide the
6-4 information under this section and each change to information
6-5 previously provided under this section in a report that includes
6-6 the information for registrations and changes occurring during the
6-7 week preceding the date of the report.
6-8 (d) The Texas Department of Transportation shall provide by
6-9 electronic submission to the department or its designated agent any
6-10 information required under this section in a timely manner as
6-11 prescribed by the public safety director.
6-12 Sec. 601.447. RULES. (a) The department may adopt rules as
6-13 necessary to implement this subchapter.
6-14 (b) The department shall consult with the Texas Department
6-15 of Transportation about rules that affect the reporting of
6-16 information relating to vehicle registrations.
6-17 (c) The department by rule may waive a requirement that
6-18 particular information be provided to the designated agent if the
6-19 department finds that the information is not useful for enforcing
6-20 this chapter or that the burden of collecting or reporting the
6-21 information is not justified by its value in enforcing this
6-22 chapter.
6-23 Sec. 601.448. INFORMATION REMAINS PROPERTY OF AGENCIES.
6-24 (a) Information provided by the department under Section 601.445
6-25 and information provided by the the Texas Department of
6-26 Transportation under Section 601.446 remains the property of each
6-27 agency and may not be sold or made available except to enforce a
7-1 state law.
7-2 (b) Information provided by the department under Section
7-3 601.445 and information provided by the Texas Department of
7-4 Transportation under Section 601.446 is confidential and not
7-5 subject to disclosure under Chapter 552, Government Code.
7-6 Sec. 601.449. LIABILITY OF CERTAIN OFFICERS, EMPLOYEES, AND
7-7 AGENTS. An officer or employee of an insurance company, an
7-8 officer, employee, or agent of the department, or an officer,
7-9 employee, agent, or statutory agent of the Texas Department of
7-10 Transportation is not liable in a civil action for an act
7-11 performed in good faith in providing information in compliance with
7-12 this subchapter.
7-13 Sec. 601.450. VIOLATION; ADMINISTRATIVE SANCTIONS.
7-14 (a) Violation by an insurance company of this subchapter is a
7-15 ground for an administrative sanction by the commissioner of
7-16 insurance under Articles 1.10 and 1.10E, Insurance Code, including
7-17 the revocation of the company's certificate of authority to engage
7-18 in the business of insurance in this state. The commissioner of
7-19 insurance may assess an administrative penalty against that
7-20 insurance company in an amount not to exceed $250 for each policy
7-21 involved for each day of noncompliance.
7-22 (b) Not later than the 10th day after the date the
7-23 commissioner determines a violation has occurred, the commissioner
7-24 shall send by certified mail a notice of the determination to the
7-25 insurance company involved with a statement of the right of the
7-26 insurance company to a hearing relating to the alleged violation
7-27 and the amount of the penalty.
8-1 (c) Not later than the 20th day after the date the report is
8-2 sent, the insurance company may make a written request for a
8-3 hearing or may remit the amount of the administrative penalty to
8-4 the Texas Department of Insurance. Failure to request a hearing or
8-5 to remit the amount of the administrative penalty within the time
8-6 provided by this subsection waives the right to a hearing under
8-7 this subsection. Not later than the 30th day after the date the
8-8 notice is received, the insurance company charged shall pay the
8-9 administrative penalty in full or, if the insurance company wishes
8-10 to contest the amount of the penalty or the violation, forward the
8-11 amount of the penalty assessed to the Texas Department of Insurance
8-12 for deposit in an escrow account.
8-13 (d) If after the hearing or judicial review it is determined
8-14 that a violation did not occur or that the amount of the penalty
8-15 should be reduced, the Texas Department of Insurance shall return
8-16 the appropriate amount to the insurance company charged with the
8-17 violation not later than the 30th day after the date the
8-18 determination becomes final.
8-19 Sec. 601.451. VIOLATION; CRIMINAL PENALTY. (a) A person
8-20 commits an offense if the person knowingly releases information
8-21 maintained by the department or its designated agent under this
8-22 subchapter except to enforce a state law.
8-23 (b) An offense under this section is a Class A misdemeanor.
8-24 SECTION 2. Section 502.104, Transportation Code, is amended
8-25 to read as follows:
8-26 Sec. 502.104. DISPOSITION OF CERTAIN SPECIAL FEES. Each
8-27 Monday a county assessor-collector shall send to the department an
9-1 amount equal to collections for the preceding week for:
9-2 (1) each transfer fee collected under Section 502.175;
9-3 and
9-4 (2) each fee collected under Section 502.169(b),
9-5 502.1715, or 502.279.
9-6 SECTION 3. Subchapter D, Chapter 502, Transportation Code,
9-7 is amended by adding Section 502.1715 to read as follows:
9-8 Sec. 502.1715. ADDITIONAL FEE FOR EVIDENCE OF FINANCIAL
9-9 RESPONSIBILITY SYSTEM. (a) In addition to other fees imposed for
9-10 registration of a motor vehicle at the time of application for
9-11 registration or renewal of registration of a motor vehicle for
9-12 which the owner is required to submit evidence of financial
9-13 responsibility under Section 502.153, the applicant shall pay a fee
9-14 of $3.
9-15 (b) Fees collected under this section shall be deposited to
9-16 the credit of the state highway fund. The department shall use
9-17 money appropriated from the state highway fund that represents
9-18 those fees to administer Subchapter N, Chapter 601, and to
9-19 reimburse the Department of Public Safety for expenses in
9-20 administering that subchapter.
9-21 (c) The department and the Department of Public Safety shall
9-22 adopt rules and develop forms necessary to administer this section.
9-23 SECTION 4. This Act takes effect September 1, 1999.
9-24 SECTION 5. (a) As soon as practicable after the effective
9-25 date of this Act, the Department of Public Safety shall appoint a
9-26 technical advisory committee to assist the department in developing
9-27 the initial rules required for implementation of Subchapter N,
10-1 Chapter 601, Transportation Code, as added by this Act. The
10-2 technical advisory committee must include representatives of the
10-3 affected insurance companies and representatives of the Texas
10-4 Department of Transportation.
10-5 (b) The technical advisory committee shall prepare
10-6 recommended rules for consideration by the Department of Public
10-7 Safety not later than April 1, 2000.
10-8 (c) This section expires and the technical advisory
10-9 committee is abolished September 1, 2000.
10-10 SECTION 6. (a) Not later than September 1, 2000:
10-11 (1) the Department of Public Safety shall contract
10-12 with an entity to serve as designated agent under Subchapter N,
10-13 Chapter 601, Transportation Code, as added by this Act; and
10-14 (2) the Department of Public Safety shall adopt any
10-15 rules necessary to implement Subchapter N, Chapter 601,
10-16 Transportation Code, as added by this Act.
10-17 (b) Except as provided by Subsection (c) of this section, a
10-18 motor vehicle insurance company is not required to report under
10-19 Section 601.444, Transportation Code, as added by this Act, before
10-20 September 1, 2000.
10-21 (c) The Department of Public Safety by rule may designate,
10-22 by market share, premium volume, or another similar characteristic,
10-23 smaller motor vehicle insurance companies that are not required to
10-24 report under Section 601.444, Transportation Code, as added by this
10-25 Act, before September 1, 2001.
10-26 (d) The Department of Public Safety is not required to
10-27 report under Sections 601.445(b) and (c), Transportation Code, as
11-1 added by this Act, before September 1, 2000.
11-2 SECTION 7. The importance of this legislation and the
11-3 crowded condition of the calendars in both houses create an
11-4 emergency and an imperative public necessity that the
11-5 constitutional rule requiring bills to be read on three several
11-6 days in each house be suspended, and this rule is hereby suspended.
11-7 COMMITTEE AMENDMENT NO. 1
11-8 Amend House Bill 2793, page 1, between lines 5 and 6, insert
11-9 the following by number section and renumber subsequent sections
11-10 appropriately:
11-11 SECTION 1. Sec. 601.053, Transportation Code, is amended to
11-12 read as follows:
11-13 Sec. 601.053. EVIDENCE OF FINANCIAL RESPONSIBILITY. (a) (2)
11-14 a standard proof of motor vehicle liability insurance form produced
11-15 by the department [Texas Department of Insurance] under Section
11-16 601.081 and issued by a liability insurer for the motor vehicle;
11-17 SECTION 2. Sec. 601.081, Transportation Code, is amended to
11-18 read as follows:
11-19 Sec. 601.081. STANDARD PROOF OF MOTOR VEHICLE LIABILITY
11-20 INSURANCE FORM. (a) The department shall provide for the
11-21 production of a standardized proof of motor vehicle liability
11-22 insurance form for use by insurers. The department is authorized
11-23 to contract with a third party for the production of the standard
11-24 proof of motor vehicle liability insurance form.
11-25 (b) Insurers shall complete and distribute to insured the
11-26 standard proof of motor vehicle liability insurance form that is
11-27 produced by the department. Insurers and insurance agents are
12-1 prohibited from producing or contracting with a third party to
12-2 produce a standardized proof of motor vehicle liability insurance
12-3 form.
12-4 (c) The department is authorized to establish rules for the
12-5 implementation of this section including the use of security
12-6 features for the standardized form.
12-7 (d) The [A] standard proof of motor vehicle liability
12-8 insurance form prescribed by the Texas Department of Insurance and
12-9 the department must include:
12-10 (1) the name of the insurer;
12-11 (2) the insurance policy number;
12-12 (3) the policy period;
12-13 (4) the name and address of each insured;
12-14 (5) the policy limits or a statement that the coverage
12-15 of the policy complies with the minimum amounts of motor vehicle
12-16 liability insurance required by this chapter; and
12-17 (6) the make and model of each covered vehicle.
12-18 Moreno of Harris