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78R1684 DWS-F
By: Gutierrez H.B. No. 814
A BILL TO BE ENTITLED
AN ACT
relating to requirements regarding motor vehicle insurance and
motor vehicle insurance verification; providing penalties.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:
ARTICLE 1. FINANCIAL RESPONSIBILITY REQUIREMENTS
SECTION 1.01. Chapter 601, Transportation Code, is amended
by adding Subchapter N to read as follows:
SUBCHAPTER N. VERIFICATION OF COMPLIANCE WITH AND ENFORCEMENT OF
FINANCIAL RESPONSIBILITY REQUIREMENTS
Sec. 601.441. DEFINITIONS. In this subchapter:
(1) "Database" means the motor vehicle insurance
verification database established under this subchapter.
(2) "Designated agent" means a person administering
the program under a contract with the department.
(3) "Program" means the motor vehicle insurance
verification program established under this subchapter.
(4) "Verification date" means the date the Texas
Department of Transportation mails a written request to an owner of
a motor vehicle requiring the owner to state whether the owner has
established financial responsibility in accordance with Section
601.051.
Sec. 601.442. ESTABLISHMENT OF FINANCIAL RESPONSIBILITY
THROUGH RANDOM SAMPLING. (a) The Texas Department of
Transportation or an agent designated by that department shall
randomly select samples of registrations of motor vehicles subject
to this chapter, and may select samples of owners of motor vehicles
subject to this chapter, to verify whether an owner who is selected
or whose motor vehicle is selected has established financial
responsibility in accordance with Section 601.051. The department
shall provide the Texas Department of Transportation access to any
information that will allow the Texas Department of Transportation
to comply with this subsection.
(b) A sample selected under this section may not be
classified on the basis of the owner's race, color, religion, sex,
national origin, age, marital status, physical or mental
disability, economic status, or geographic location.
(c) In addition to the general random sampling of motor
vehicle registrations, the Texas Department of Transportation may
randomly select other persons who own a registered motor vehicle to
verify that the person has established financial responsibility,
including a person:
(1) who, during the four-year period preceding the
date of selection, has been convicted of a violation of Section
601.191 or 601.195, or of Section 601.196 as it existed before
repeal, including a violation that occurred while the person was
operating a motor vehicle owned by another person; or
(2) whose driver's license or motor vehicle
registration has been suspended during the four-year period
preceding the date of selection.
(d) The Texas Department of Transportation or the agent
designated by the Texas Department of Transportation shall send to
the owner of a randomly selected motor vehicle, or to a randomly
selected motor vehicle owner, a request for information about the
motor vehicle and the owner's method of establishing financial
responsibility. The request must require the owner to state
whether the owner has, as of the verification date, established
financial responsibility in accordance with Section 601.051.
(e) The Texas Department of Transportation:
(1) shall adopt rules as necessary to implement this
subchapter; and
(2) by rule shall:
(A) establish the frequency of sample selection;
and
(B) prescribe:
(i) the methods employed for the random
selection of samples and the procedures necessary for
implementation of the verification process, including the method of
sending the verification request, which may include certified mail,
return receipt requested;
(ii) the form for verification of financial
responsibility; and
(iii) the information to be requested in
the prescribed form.
(f) The Texas Department of Transportation may require the
information provided by an owner to include a statement by the owner
that the owner had, as of the verification date, established
financial responsibility:
(1) through liability insurance under Subchapter D,
including:
(A) the name and address of the insurer;
(B) the number of the insurance policy; and
(C) the expiration date of the insurance
coverage;
(2) by filing a surety bond with the department under
Section 601.121, including:
(A) the name and address of the company issuing
the bond;
(B) the identification number of the bond; and
(C) the expiration date of the bond;
(3) by depositing cash or securities with the
comptroller under Section 601.122, including a copy of the
certificate issued by the comptroller showing compliance;
(4) by depositing cash or a cashier's check with the
county judge of the county in which the motor vehicle is registered
under Section 601.123, including a copy of the certificate issued
by the county judge showing compliance; or
(5) through self-insurance under Section 601.124,
including a copy of the certificate of self-insurance issued by the
department.
(g) Not later than the 30th day after the verification date,
the owner to whom the notice is sent shall furnish the requested
information to the Texas Department of Transportation in the form
prescribed by the Texas Department of Transportation, accompanied
by the owner's signed affirmation that the information is true and
correct.
(h) If the owner responds to the request for information by
asserting that the owner had, as of the verification date,
established financial responsibility in accordance with a method
authorized by Section 601.051, the Texas Department of
Transportation, or an agent designated by the Texas Department of
Transportation, may conduct a verification investigation as
provided by Section 601.445.
Sec. 601.443. ESTABLISHMENT OF VERIFICATION PROGRAM. (a)
The department shall establish a motor vehicle insurance
verification program to verify compliance with this chapter.
(b) The department by rule shall administer the program with
the assistance of a designated agent.
(c) The program must comply with the Driver's Privacy
Protection Act of 1994 (18 U.S.C. Section 2721 et seq.), as amended.
Sec. 601.444. DESIGNATED AGENT: MAINTENANCE OF DATABASE.
(a) The department's designated agent shall assist the Texas
Department of Transportation to randomly select samples of
registrations of motor vehicles or samples of owners of motor
vehicles subject to this chapter as provided by Section 601.442.
(b) The department shall contract with a person to act as
the department's designated agent under this subchapter. The
contract may be awarded under a competitive bid procedure as
provided by department rule. The contract may not obligate the
department to pay more money than the public safety director
determines will be available from fees collected under Section
502.1715.
(c) The designated agent shall develop and maintain a
computer database to manage and provide access to information
provided under Sections 601.446, 601.447, and 601.448.
(d) The database shall be developed, maintained, and
administered in accordance with guidelines established by the
department to permit efficient access by courts and state and local
law enforcement agencies.
Sec. 601.445. VERIFICATION: NOTICE FOR NONCOMPLIANCE. (a)
With information provided by the department and the Texas
Department of Transportation, the designated agent shall, at least
monthly:
(1) update the database with the motor vehicle
insurance information provided by insurers under Section 601.446;
and
(2) compare all current motor vehicle registrations,
provided by the Texas Department of Transportation, including
information received from the random selection, against the
database.
(b) If a comparison under this section shows that a motor
vehicle is not insured, the department may direct that the
designated agent mail a notice to the owner of the motor vehicle
stating that the owner has 30 days to provide:
(1) proof of the owner's financial responsibility in a
form described by Section 601.053;
(2) a letter from an insurance agent or company
verifying that the person had the required motor vehicle insurance
coverage on the date of action specified by the database query;
(3) proof of an exemption from the owner's financial
responsibility under Section 601.052; or
(4) proof that the owner of the motor vehicle is
insured by an insurance company located in another state because
the owner is a member of the United States armed forces, a student
attending an educational institution in this state and residing in
this state, or a faculty member of an educational institution in
this state who is residing in this state.
(c) If an owner of a motor vehicle has not provided proof of
financial responsibility to the designated agent before the 31st
day after the date the notice is sent, the department may direct the
designated agent to provide an additional notice.
Sec. 601.446. INFORMATION PROVIDED BY INSURANCE COMPANY.
(a) Each insurance company providing motor vehicle liability
policies in this state shall provide the designated agent a record
of each motor vehicle insurance policy, including:
(1) the insurance policy number, effective date, and
expiration date;
(2) the name, address, and driver's license number of
each driver insured by the policy; and
(3) the make, model, year, and vehicle identification
number of each vehicle covered by the policy.
(b) Each insurance company shall provide information
required by Subsection (a) to the designated agent in an electronic
submission monthly or more frequently as prescribed by the public
safety director.
(c) If information provided by an insurance company to the
designated agent is incorrect, the insurance company shall provide
corrected information to the designated agent in a timely manner as
prescribed by the public safety director after the date the
insurance company receives notice of the error from the designated
agent.
(d) Information provided by an insurance company under this
section remains the property of the insurance company and may not be
sold or made available except to enforce a state law.
Sec. 601.447. INFORMATION PROVIDED BY DEPARTMENT. (a) The
department shall provide to the designated agent the following
information for each Texas driver's license holder:
(1) the holder's name and address; and
(2) the driver's license number and expiration date.
(b) For each motor vehicle covered by a bond filed under
Section 601.121, a deposit made under Section 601.123, or a
certificate of self-insurance issued under Section 601.124, the
department shall provide to the designated agent:
(1) the owner's name and address; and
(2) the owner's driver's license number and expiration
date.
(c) The department shall notify the designated agent of:
(1) the cancellation of a bond filed under Section
601.121;
(2) the cancellation of a deposit filed under Section
601.123; or
(3) the termination of a certificate of self-insurance
issued under Section 601.124.
(d) This section does not require the department to provide
to the designated agent information that is not in the possession of
the department.
(e) The department shall provide to the designated agent the
information under this section in an electronic submission in a
timely manner as prescribed by the public safety director.
(f) The department is not liable to any person for damages
arising as a result of providing information as required by this
section.
Sec. 601.448. INFORMATION PROVIDED BY TEXAS DEPARTMENT OF
TRANSPORTATION. (a) The Texas Department of Transportation shall
provide the department or the department's designated agent the
following information for each motor vehicle to which this chapter
applies, to the extent the information is in the Texas Department of
Transportation's records:
(1) the owner's name and address;
(2) the make, model, and year of the vehicle;
(3) the vehicle identification number and vehicle
license plate number; and
(4) the date the certificate of title was issued for
the vehicle.
(b) The Texas Department of Transportation is not required
to provide information under this section about a vehicle
registered under Subchapter G, Chapter 502.
(c) The Texas Department of Transportation shall provide
the information under this section and each change to information
previously provided under this section in a weekly report that
includes the information for registrations and changes occurring
during the week preceding the date of the report.
(d) The Texas Department of Transportation shall provide by
electronic submission to the department or the department's
designated agent any information required under this section in a
timely manner as prescribed by the public safety director.
Sec. 601.449. RULES. (a) The department may adopt rules as
necessary to implement this subchapter.
(b) The department shall consult with the Texas Department
of Transportation about rules that affect the reporting of
information relating to vehicle registrations.
(c) The department by rule may waive a requirement that
particular information be provided to the designated agent if the
department finds that the information is not useful for enforcing
this chapter or that the burden of collecting or reporting the
information is not justified by its value in enforcing this
chapter.
(d) The Texas Department of Insurance shall adopt rules for
enforcing compliance for insurance companies reporting under
Section 601.446.
Sec. 601.450. INFORMATION REMAINS PROPERTY OF AGENCIES.
(a) Information provided by the department under Section 601.447
and information provided by the Texas Department of Transportation
under Section 601.448 remains the property of each agency and may
not be sold or made available except to enforce a state law.
(b) Information provided by the department under Section
601.447 and information provided by the Texas Department of
Transportation under Section 601.448 is confidential and not
subject to disclosure under Chapter 552, Government Code.
Sec. 601.451. LIABILITY OF CERTAIN OFFICERS, EMPLOYEES, AND
AGENTS. An officer or employee of an insurance company, an officer,
employee, or agent of the department, or an officer, employee,
agent, or statutory agent of the Texas Department of Transportation
is not liable in a civil action for an act performed in good faith in
providing information in compliance with this subchapter.
Sec. 601.452. VIOLATION; CRIMINAL PENALTY. (a) A person
commits an offense if the person knowingly releases information
maintained by the department or its designated agent under this
subchapter except to enforce a state law.
(b) An offense under this section is a Class A misdemeanor.
Sec. 601.453. REVIEW OF PROGRAM. (a) After January 1,
2009, and before September 1, 2009, the department shall review the
effectiveness of the program and determine the amount by which
compliance with this chapter has increased between September 1,
2003, and the date of the review. The department may coordinate
with the Texas Department of Insurance to conduct the review.
Before November 1, 2009, the department shall file copies of the
review with the governor, the lieutenant governor, the speaker of
the house of representatives, and the Texas Legislative Council and
file a summary of the review with the secretary of state for
publication in the Texas Register. If the department determines
that compliance has not increased by at least eight percent during
that period, this subchapter and Section 502.1715 expire September
2, 2009.
(b) This section expires September 2, 2009.
ARTICLE 2. PROOF OF INSURANCE CARDS
SECTION 2.01. Section 601.053(a), Transportation Code, is
amended to read as follows:
(a) As a condition of operating in this state a motor
vehicle to which Section 601.051 applies, the operator of the
vehicle on request shall provide to a peace officer, as defined by
Article 2.12, Code of Criminal Procedure, or a person involved in an
accident with the operator evidence of financial responsibility by
exhibiting:
(1) a motor vehicle liability insurance policy
covering the vehicle that satisfies Subchapter D or a photocopy of
the policy;
(2) a standard proof of motor vehicle liability
insurance form prescribed by the department [Texas Department of
Insurance] under Section 601.081 and issued by a liability insurer
for the motor vehicle;
(3) an insurance binder that confirms the operator is
in compliance with this chapter;
(4) a surety bond certificate issued under Section
601.121;
(5) a certificate of a deposit with the comptroller
covering the vehicle issued under Section 601.122;
(6) a copy of a certificate of a deposit with the
appropriate county judge covering the vehicle issued under Section
601.123; or
(7) a certificate of self-insurance covering the
vehicle issued under Section 601.124 or a photocopy of the
certificate.
SECTION 2.02. Section 601.081, Transportation Code, is
amended to read as follows:
Sec. 601.081. STANDARD PROOF OF MOTOR VEHICLE LIABILITY
INSURANCE FORM. (a) The department shall provide for the
production of a standard proof of motor vehicle liability insurance
form for use by insurers. The department may contract with another
person for production of the form.
(b) Each insurer issuing a standard proof of motor vehicle
liability insurance form shall use a form produced by the
department.
(c) The department may adopt rules to implement this
section, including rules relating to the use of security features
for the form.
(d) The [A] standard proof of motor vehicle liability
insurance form prescribed by the department [Texas Department of
Insurance] must include:
(1) the name of the insurer;
(2) the insurance policy number;
(3) the policy period;
(4) the name and address of each insured;
(5) the policy limits or a statement that the coverage
of the policy complies with the minimum amounts of motor vehicle
liability insurance required by this chapter; and
(6) the make and model of each covered vehicle.
SECTION 2.03. Sections 601.371(d) and (e), Transportation
Code, are amended to read as follows:
(d) Except as provided by Subsection (e), an offense under
this section is a misdemeanor punishable by[:
[(1)] a fine of not less than $100 or more than $750
[$500; and
[(2) confinement in county jail for a term of not less
than 72 hours or more than six months].
(e) If it is shown on the trial of an offense under this
section that the person has previously been convicted two or more
times of an offense under this section or under Section 521.457, the
offense is punishable as a Class B [A] misdemeanor.
ARTICLE 3. FEE FOR MOTOR VEHICLE INSURANCE VERIFICATION PROGRAM
SECTION 3.01. Section 502.104, Transportation Code, is
amended to read as follows:
Sec. 502.104. DISPOSITION OF CERTAIN SPECIAL FEES. Each
Monday a county assessor-collector shall send to the department an
amount equal to collections for the preceding week for:
(1) each transfer fee collected under Section 502.175;
and
(2) each fee collected under Section 502.169(b),
502.1715, or 502.279.
SECTION 3.02. Subchapter D, Chapter 502, Transportation
Code, is amended by adding Section 502.1715 to read as follows:
Sec. 502.1715. ADDITIONAL FEE FOR MOTOR VEHICLE INSURANCE
VERIFICATION PROGRAM. (a) In addition to other fees imposed for
registration of a motor vehicle, at the time of application for
registration or renewal of registration of a motor vehicle for
which the owner is required to submit evidence of financial
responsibility under Section 502.153, the applicant shall pay a fee
of $1.
(b) Fees collected under this section shall be deposited to
the credit of the state highway fund. The department shall use
money appropriated from the state highway fund that represents
those fees to administer Subchapter N, Chapter 601, and to
reimburse the Department of Public Safety for expenses in
administering that subchapter.
(c) The department and the Department of Public Safety shall
adopt rules and develop forms necessary to administer this section.
ARTICLE 4. EFFECTIVE DATE; TRANSITION
SECTION 4.01. This Act takes effect September 1, 2003.
SECTION 4.02. (a) As soon as practicable after the
effective date of this Act, the Department of Public Safety shall
appoint a technical advisory committee to assist the department in
developing the initial rules required for implementation of
Subchapter N, Chapter 601, Transportation Code, as added by this
Act. The technical advisory committee must include representatives
of the affected insurance companies and representatives of the
Texas Department of Transportation.
(b) The technical advisory committee shall prepare
recommended rules for consideration by the Department of Public
Safety not later than March 1, 2004.
(c) This section expires and the technical advisory
committee is abolished September 1, 2004.
SECTION 4.03. (a) Not later than September 1, 2004:
(1) the Department of Public Safety shall contract
with an entity to serve as the designated agent under Subchapter N,
Chapter 601, Transportation Code, as added by this Act; and
(2) the Department of Public Safety shall adopt any
rules necessary to implement Subchapter N, Chapter 601,
Transportation Code, as added by this Act.
(b) Except as provided by Subsection (c) of this section, a
motor vehicle insurance company is not required to report under
Section 601.446, Transportation Code, as added by this Act, before
September 1, 2004.
(c) The Department of Public Safety by rule may designate,
by market share, premium volume, or another similar characteristic,
smaller motor vehicle insurance companies that are not required to
report under Section 601.446, Transportation Code, as added by this
Act, before September 1, 2005.
(d) The Department of Public Safety is not required to
report under Sections 601.447(b) and (c), Transportation Code, as
added by this Act, before September 1, 2004.
SECTION 4.04. (a) The change in law made by this Act to
Section 601.371, Transportation Code, applies only to an offense
committed on or after the effective date of this Act. For the
purposes of this section, an offense is committed before the
effective date of this Act if any element of the offense occurs
before that date.
(b) An offense committed before the effective date of this
Act is governed by the law in effect when the offense was committed,
and the former law is continued in effect for that purpose.