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Text: HF00317                           Text: HF00319
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House File 318

Partial Bill History

Bill Text

PAG LIN
  1  1    Section 1.  Section 321.1, Code 1995, is amended by adding
  1  2 the following new subsections:
  1  3    NEW SUBSECTION.  34A.  "Liability insurance coverage" means
  1  4 any of the following:
  1  5    a.  An owner's policy of liability insurance which is
  1  6 issued by an insurance company authorized to do business in
  1  7 Iowa to or for the benefit of the person named in the policy
  1  8 as insured, and insuring the person named as insured and any
  1  9 person using an insured motor vehicle with the express or
  1 10 implied permission of the named insured against loss from
  1 11 liability imposed by law for damages arising out of the
  1 12 ownership, maintenance, or use of an insured motor vehicle
  1 13 within the United States of America or the Dominion of Canada,
  1 14 but subject to minimum limits, exclusive of interest and
  1 15 costs, in the amounts specified in section 321A.21 or
  1 16 specified in another provision of the Code, whichever is
  1 17 greater.
  1 18    b.  A bond filed with the director pursuant to section
  1 19 321A.24.
  1 20    c.  A valid certificate of deposit of money or security
  1 21 issued by the treasurer of state pursuant to section 321A.25.
  1 22    d.  A valid certificate of self-insurance issued by the
  1 23 director pursuant to section 321A.34.
  1 24    NEW SUBSECTION.  54A.  "Proof of insurance card" means
  1 25 either a liability insurance card issued under section
  1 26 321.20A, bond insurance card issued under section 321A.24,
  1 27 security insurance card issued under section 321A.25, or self-
  1 28 insurance card issued under section 321A.34.
  1 29    Sec. 2.  Section 321.20, Code 1995, is amended by adding
  1 30 the following new subsection:
  1 31    NEW SUBSECTION.  6.  Proof of liability insurance coverage
  1 32 if the registration is for a motor vehicle.
  1 33    Sec. 3.  NEW SECTION.  321.20A  PROOF OF LIABILITY
  1 34 INSURANCE COVERAGE.
  1 35    1.  Notwithstanding chapter 321A, which requires certain
  2  1 persons to maintain proof of financial responsibility, a
  2  2 person shall not drive a motor vehicle on the highways of this
  2  3 state unless liability insurance coverage as defined in
  2  4 section 321.1, subsection 34A, is in effect for the motor
  2  5 vehicle and unless the driver has in the motor vehicle the
  2  6 proof of insurance card issued for the motor vehicle.
  2  7    2.  An insurance company transacting business in this state
  2  8 shall issue to its insured owners of motor vehicles registered
  2  9 in this state a liability insurance card for each insured
  2 10 issued a motor vehicle license.  The liability insurance card
  2 11 shall be in accordance with rules adopted by the commissioner
  2 12 of insurance pursuant to chapter 17A after consultation with
  2 13 the state department of transportation.  Each liability
  2 14 insurance card shall identify the motor vehicle license number
  2 15 of the insured and shall indicate the expiration date of the
  2 16 applicable liability insurance coverage.  The liability
  2 17 insurance card shall also contain the name and address of the
  2 18 insured and insurer.
  2 19    3.  If the liability insurance coverage for a person issued
  2 20 a motor vehicle license in this state is canceled or
  2 21 terminated effective prior to the expiration date indicated on
  2 22 the liability insurance card issued for the person, the person
  2 23 shall return the liability insurance card to the insurer which
  2 24 issued the card.
  2 25    4.  An insurance company transacting business in this state
  2 26 shall notify the state department of transportation and the
  2 27 sheriff of the county of the person's last known address of a
  2 28 cancellation of an insurance policy issued to that person
  2 29 within forty-five days after the policy's cancellation.  The
  2 30 notification shall be in a manner prescribed by the
  2 31 commissioner of insurance after consultation with the state
  2 32 department of transportation.
  2 33    5.  An owner or driver of a motor vehicle who is charged
  2 34 with violating subsection 1 shall not be convicted if the
  2 35 person produces in court, within a reasonable time, proof that
  3  1 liability insurance coverage was in effect for the person at
  3  2 the time of the person's arrest.
  3  3    6.  The director of transportation and the commissioner of
  3  4 insurance shall adopt rules pursuant to chapter 17A to
  3  5 implement this section.
  3  6    Sec. 4.  Section 321.177, Code 1995, is amended by adding
  3  7 the following new subsection:
  3  8    NEW SUBSECTION.  10.  To any person who does not at the
  3  9 time of application provide proof of liability insurance
  3 10 coverage as required in section 321.20A.
  3 11    Sec. 5.  Section 321.492, unnumbered paragraph 1, Code
  3 12 1995, is amended to read as follows:
  3 13    Any A peace officer is authorized to stop any a vehicle to
  3 14 require exhibition of the driver's motor vehicle license, to
  3 15 require exhibition of the proof of insurance card issued for
  3 16 the driver, to serve a summons or memorandum of traffic
  3 17 violation, to inspect the condition of the vehicle, to inspect
  3 18 the vehicle with reference to size, weight, cargo, log book,
  3 19 bills of lading or other manifest of employment, tires, and
  3 20 safety equipment, or to inspect the registration certificate,
  3 21 the compensation certificate, travel order, or permit of the
  3 22 vehicle.
  3 23    Sec. 6.  Section 321A.17, subsections 1 through 3, Code
  3 24 1995, are amended to read as follows:
  3 25    1.  Whenever When the department, under any a law of this
  3 26 state, suspends or revokes the license of any a person upon
  3 27 receiving record of a conviction or a forfeiture of bail or
  3 28 revokes the license of any a person pursuant to chapter 321J,
  3 29 the department shall also suspend the registration for all
  3 30 motor vehicles registered in the name of the person, except
  3 31 that the department shall not suspend the registration, unless
  3 32 otherwise required by law, if the person has previously given
  3 33 or immediately gives and thereafter maintains proof of
  3 34 financial responsibility liability insurance coverage, as
  3 35 defined in section 321.1, subsection 34A, with respect to all
  4  1 motor vehicles registered by the person.
  4  2    2.  Such The license and registration shall remain
  4  3 suspended or revoked and shall not at any time thereafter be
  4  4 renewed nor shall any and a license shall not be thereafter
  4  5 issued to such the person, nor shall any motor vehicle be
  4  6 thereafter registered in the name of such person until
  4  7 permitted under the motor vehicle laws of this state and not
  4  8 then unless and until the person shall give gives and
  4  9 thereafter maintain maintains proof of financial
  4 10 responsibility liability insurance coverage, as defined in
  4 11 section 321.1, subsection 34A.
  4 12    3.  If a person is not licensed, but by final order or
  4 13 judgment is convicted of or forfeits any bail or collateral
  4 14 deposited to secure an appearance for trial for any offense
  4 15 requiring the suspension or revocation of license, or for
  4 16 operating an unregistered motor vehicle upon the highways, no
  4 17 a license shall not be thereafter issued to such that person
  4 18 and no motor vehicle shall continue to be registered or
  4 19 thereafter be registered in the name of such person until the
  4 20 person shall give gives and thereafter maintain maintains
  4 21 proof of financial responsibility liability insurance
  4 22 coverage, as defined in section 321.1, subsection 34A.
  4 23    Sec. 7.  Section 321A.24, subsection 1, Code 1995, is
  4 24 amended to read as follows:
  4 25    1.  Proof of financial responsibility liability insurance
  4 26 coverage, as defined in section 321.1, subsection 34A, may be
  4 27 evidenced by the bond of a surety company duly authorized to
  4 28 transact business within this state, or a bond with at least
  4 29 two individual sureties each owning real estate within this
  4 30 state, and together having equities equal in value to at least
  4 31 twice the amount of the bond, which real estate shall be
  4 32 scheduled in the bond approved by a judge or clerk of a the
  4 33 district court of record, and which said bond shall be
  4 34 conditioned for payment of the amounts specified in section
  4 35 321A.1, subsection 10.  Such The bond shall be filed with the
  5  1 department and shall is not be cancelable except after ten
  5  2 days' written notice to the department.  Such The department
  5  3 shall issue to the person filing the bond a bond insurance
  5  4 card.  The bond insurance card shall state the name and
  5  5 address of the person to whom the card is issued.  The bond
  5  6 shall constitute constitutes a lien in favor of the state upon
  5  7 the real estate so scheduled of any surety, which lien shall
  5  8 exist exists in favor of any holder of a final judgment
  5  9 against the person who has filed such the bond, for damages,
  5 10 including damages for care and loss of services, because of
  5 11 bodily injury to or death of any a person, or for damage
  5 12 because of injury to or destruction of property, including the
  5 13 loss of use thereof of the property, resulting from the
  5 14 ownership, maintenance, use, or operation of a motor vehicle
  5 15 after such the bond was filed, upon the filing of notice to
  5 16 that effect by the department in the office of the proper
  5 17 clerk of the district court of the county where such the real
  5 18 estate shall be is located.  Any An individual surety so
  5 19 scheduling real estate security shall furnish satisfactory
  5 20 evidence of title thereto to the property and the nature and
  5 21 extent of all encumbrances thereon on the property and the
  5 22 value of the surety's interest therein in the property, in
  5 23 such the manner as the judge or clerk of the district court of
  5 24 record approving the bond may require requires.  The notice
  5 25 filed by the department shall contain, in addition to any
  5 26 other matters deemed by the department to be pertinent,
  5 27 contain a legal description of the real estate so scheduled,
  5 28 the name of the holder of the record title, the amount for
  5 29 which it stands as security, and the name of the person in
  5 30 whose behalf proof is so being made.  Upon the filing of such
  5 31 the notice the clerk of the district court of such county
  5 32 shall retain the same notice as part of the records of such
  5 33 the court and enter upon the encumbrance book the date and
  5 34 hour of filing, the name of the surety, the name of the record
  5 35 titleholder, the description of the real estate, and the
  6  1 further notation that a lien is charged on such the real
  6  2 estate pursuant to the filed notice filed hereunder.  From and
  6  3 after the entry of the foregoing notice upon the encumbrance
  6  4 book all persons whomsoever shall be are charged with notice
  6  5 thereof of it.
  6  6    If the bond is cancelled, the person who filed the bond
  6  7 shall surrender to the department all bond insurance cards
  6  8 issued to the person.
  6  9    Sec. 8.  Section 321A.25, subsection 1, Code 1995, is
  6 10 amended to read as follows:
  6 11    1.  With respect to accidents occurring on or after January
  6 12 1, 1981, and before January 1, 1983, proof of financial
  6 13 responsibility may be evidenced by the certificate of the
  6 14 state treasurer that the person named in the certificate has
  6 15 deposited with the treasurer forty thousand dollars in cash,
  6 16 or securities such as may legally be purchased by a state bank
  6 17 or for trust funds of a market value of forty thousand
  6 18 dollars; and with respect to accidents occurring on or after
  6 19 January 1, 1983, proof Proof of financial responsibility
  6 20 liability insurance coverage, as defined in section 321.1,
  6 21 subsection 34A, may be evidenced by the certificate of the
  6 22 state treasurer of state that the person named in the
  6 23 certificate has deposited with the treasurer of state fifty-
  6 24 five thousand dollars in cash, or securities such as which may
  6 25 legally be purchased by a state bank or for trust funds of a
  6 26 market value of fifty-five thousand dollars.  The treasurer of
  6 27 state shall promptly notify the state department of
  6 28 transportation of the name and address of the person to whom
  6 29 the certificate has been issued.  Upon receipt of the
  6 30 notification, the department shall issue to the person a
  6 31 security insurance card.  The security insurance card shall
  6 32 state the name and address of the person and the motor vehicle
  6 33 license number of the person.  The state treasurer of state
  6 34 shall not accept a deposit and issue a certificate for it and
  6 35 the department shall not accept the certificate unless
  7  1 accompanied by evidence that there are no unsatisfied
  7  2 judgments of any character against the depositor in the county
  7  3 where the depositor resides.
  7  4    Sec. 9.  Section 321A.32, subsection 3, Code 1995, is
  7  5 amended to read as follows:
  7  6    3.  Any A person who shall forge forges or, without
  7  7 authority, sign any signs a notice provided for under section
  7  8 321A.5 that a policy or bond is in effect, or any evidence of
  7  9 proof of financial responsibility, or any evidence of
  7 10 liability insurance coverage as defined in section 321.1,
  7 11 subsection 34A, or who files or offers for filing any such
  7 12 notice or evidence of proof knowing or having reason to
  7 13 believe that it is forged or signed without authority, shall
  7 14 be is guilty of a serious misdemeanor.
  7 15    Sec. 10.  Section 321A.34, subsections 2 and 3, Code 1995,
  7 16 are amended to read as follows:
  7 17    2.  The department may, in the department's discretion,
  7 18 upon the application of such a person, issue a certificate of
  7 19 self-insurance when if the department is satisfied that such
  7 20 the person is possessed has and will continue to be possessed
  7 21 of have the ability to pay judgments obtained against such the
  7 22 person for damages arising out of the ownership, maintenance,
  7 23 or use of any vehicle owned by such the person.  The director
  7 24 shall issue to each person who has in effect a valid
  7 25 certificate of self-insurance, a self-insurance card.  The
  7 26 card shall state the name and address of the person and shall
  7 27 state the motor vehicle license number of the person to whom
  7 28 the card is issued.
  7 29    3.  Upon not less than five days' notice and a hearing
  7 30 pursuant to such the notice, the department may upon
  7 31 reasonable grounds cancel a certificate of self-insurance.
  7 32 Failure to pay any a judgment for damages arising out of the
  7 33 ownership, maintenance, or use of any a vehicle owned by such
  7 34 the self-insurer within thirty days after such the judgment
  7 35 shall have become becomes final shall constitute constitutes a
  8  1 reasonable ground for the cancellation of a certificate of
  8  2 self-insurance.  Upon the cancellation of a certificate of
  8  3 self-insurance, the person who was issued the certificate
  8  4 shall surrender to the director all self-insurance cards
  8  5 issued to the person.
  8  6    Sec. 11.  Section 805.8, subsection 2, Code 1995, is
  8  7 amended by adding the following new paragraph:
  8  8    NEW PARAGRAPH.  z.  If, in connection with a motor vehicle
  8  9 accident, a person is charged and found guilty of a violation
  8 10 of section 321.20A, subsection 1, the scheduled fine is five
  8 11 hundred dollars, otherwise the scheduled fine for a violation
  8 12 of section 321.20A, subsection 1, is one hundred dollars.
  8 13    Sec. 12.  EFFECTIVE AND IMPLEMENTATION DATES.  Sections 1
  8 14 through 11 of this Act take effect January 1, 1996.  However,
  8 15 in order to implement this Act, the insurance division of the
  8 16 department of commerce and the director of transportation
  8 17 shall each adopt rules as required under this Act by October
  8 18 1, 1995, to be effective by January 1, 1996.  The treasurer of
  8 19 state shall notify the director of transportation of the names
  8 20 and addresses of persons who are issued valid certificates
  8 21 under section 321A.25, subsection 1, Code 1995, by November 1,
  8 22 1995, and after that date the treasurer of state shall notify
  8 23 the director of transportation as required under section 8 of
  8 24 this Act.  Insurance carriers authorized to do business in
  8 25 this state and the director of transportation shall distribute
  8 26 proof of insurance cards as required under this Act by
  8 27 December 1, 1995.  
  8 28                           EXPLANATION
  8 29    This bill prohibits a person from obtaining a motor vehicle
  8 30 license in this state unless liability insurance coverage is
  8 31 in effect for the person's motor vehicle registered in this
  8 32 state.  A violation is subject to a $500 scheduled fine if the
  8 33 violation is in connection with a motor vehicle accident,
  8 34 otherwise the scheduled fine is $100.
  8 35    The driver of the motor vehicle is also subject to a
  9  1 conviction for a violation if the driver does not have in the
  9  2 motor vehicle a proof of insurance card issued for the motor
  9  3 vehicle.  However, a person charged with not having in the
  9  4 motor vehicle a proof of insurance card will not be convicted
  9  5 if the person produces in court, within a reasonable time,
  9  6 proof that the person had liability insurance coverage at the
  9  7 time of the driver's arrest.  Under the bill, liability
  9  8 insurance coverage includes either liability insurance, the
  9  9 filing of a bond, the deposit of money or securities, or a
  9 10 certification of self-insurance.
  9 11    The bill requires insurance companies transacting business
  9 12 in this state to notify the state department of transportation
  9 13 and the sheriff of the county in which the motor vehicle is
  9 14 registered of a cancellation of an insurance policy issued to
  9 15 a person who has been issued a motor vehicle license in this
  9 16 state within 45 days after the policy's cancellation.
  9 17    The bill creates and internally cites new section 321.20A
  9 18 and new subsection 34A of section 321.1.
  9 19    The bill generally takes effect January 1, 1996, but
  9 20 certain administrative actions are required prior to that date
  9 21 to allow for the bill's implementation.
  9 22    The bill may create a state mandate as defined in chapter
  9 23 25B.  
  9 24 LSB 2413HH 76
  9 25 mj/sc/14
     
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