Text: HF00776 Text: HF00778 Text: HF00700 - HF00799 Text: HF Index Bills and Amendments: General Index Bill History: General Index
PAG LIN 1 1 HOUSE FILE 777 1 2 1 3 AN ACT 1 4 RELATING TO THE LIMITED LICENSURE OF MOTOR VEHICLE RENTAL 1 5 COMPANIES BY AUTHORIZING MOTOR VEHICLE RENTAL COMPANIES TO 1 6 OFFER AND SELL CERTAIN TYPES OF INSURANCE WITH THE RENTAL 1 7 OF VEHICLES, PROVIDING FOR LICENSURE OF COUNTER EMPLOYEES, 1 8 RELATING TO THE USE OF QUALIFIED VENDOR FOR PURPOSES OF 1 9 ADMINISTERING EXAMINATIONS, AND PROVIDING FOR A FEE FOR 1 10 LICENSE ISSUANCE. 1 11 1 12 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 1 13 1 14 Section 1. NEW SECTION. 522A.1 PURPOSE. 1 15 The purpose of this chapter is to provide for the limited 1 16 licensing of rental companies when a motor vehicle rental 1 17 company sells travel or automobile-related insurance products 1 18 or coverage in connection with and incidental to the rental of 1 19 vehicles. 1 20 Sec. 2. NEW SECTION. 522A.2 DEFINITIONS. 1 21 As used in this chapter, unless the context otherwise 1 22 requires: 1 23 1. "Commissioner" means the commissioner of insurance 1 24 appointed pursuant to section 505.2. 1 25 2. "Counter employee" means any employee at least eighteen 1 26 years of age employed by a rental company that offers the 1 27 products described in this chapter. 1 28 3. "Limited licensee" means a person at least eighteen 1 29 years of age or an entity authorized to sell certain insurance 1 30 coverages relating to the rental of vehicles. 1 31 4. "Rental agreement" means any written agreement setting 1 32 forth the terms and conditions governing the use of a vehicle 1 33 provided by a rental company for rental. 1 34 5. "Rental company" means any person or entity in the 1 35 business of primarily providing vehicles intended for the 2 1 private transportation of passengers to the public under a 2 2 rental agreement for a period not to exceed ninety days. 2 3 6. "Rental period" means the term of the rental agreement. 2 4 7. "Renter" means any person obtaining the use of a 2 5 vehicle from a rental company under the terms of a rental 2 6 agreement for a period not to exceed ninety days. 2 7 8. "Vehicle" means a motor vehicle under section 321.1 2 8 used for the private transportation of passengers, including 2 9 passenger vans, minivans, and sport utility vehicles, or used 2 10 for the transportation of cargo with a gross vehicle weight of 2 11 less than twenty-six thousand and one pounds and not requiring 2 12 the operator to possess a commercial driver's license, 2 13 including cargo vans, pickup trucks, and trucks. 2 14 Sec. 3. NEW SECTION. 522A.3 LIMITED LICENSES. 2 15 1. Notwithstanding the provisions of chapter 522, the 2 16 commissioner may issue a limited license to a rental company 2 17 that has complied with the requirements of this chapter. The 2 18 limited license shall authorize the limited licensee to offer 2 19 or sell insurance with the rental of vehicles. 2 20 2. As a prerequisite for issuance of a limited license 2 21 under this section, a written application for a limited 2 22 license, which is signed by an officer of the applicant, shall 2 23 be filed with the commissioner. The application shall be in a 2 24 form and contain information prescribed by the commissioner. 2 25 The application shall include a list of all rental locations 2 26 where the rental company intends to conduct business. An 2 27 updated list shall be provided to the commissioner within 2 28 thirty business days from any date on which the list is 2 29 amended. 2 30 3. If a provision of this section is violated by a limited 2 31 licensee, the commissioner may, after notice and a hearing, 2 32 revoke or suspend a limited license issued under this section, 2 33 or impose any other penalties, including suspending permission 2 34 for the transaction of insurance offers or sales at specific 2 35 rental locations where violations of this section have 3 1 occurred, as the commissioner deems to be necessary or 3 2 convenient to carry out the purposes of this section. 3 3 4. A rental company licensed pursuant to this section may 3 4 offer or sell insurance issued by an insurance carrier 3 5 authorized to do business in this state and only in connection 3 6 with and incidental to the rental of a vehicle. A renter 3 7 shall not be required to purchase coverage in order to rent a 3 8 vehicle. The type of insurance offered or sold by a limited 3 9 licensee, whether at the rental office or by preselection of 3 10 coverage in a master, corporate, group rental, or individual 3 11 agreement, may be in any of the following general categories: 3 12 a. Personal accident insurance covering the risks of 3 13 travel, including, but not limited to, accident and health 3 14 insurance that provides coverage, as applicable, to a renter 3 15 and other rental vehicle occupants for accidental death or 3 16 dismemberment and reimbursement for medical expenses resulting 3 17 from an accident that occurs during the rental period. 3 18 b. Liability insurance that provides coverage, as 3 19 applicable, to a renter and other authorized drivers of rental 3 20 vehicles for liability arising from the operation of the 3 21 rental vehicle. 3 22 c. Personal effects insurance that provides coverage, as 3 23 applicable, to a renter and other vehicle occupants for the 3 24 loss of, or damage to, personal effects that occurs during the 3 25 rental period. 3 26 d. Roadside assistance and emergency sickness protection 3 27 programs. 3 28 5. Insurance shall only be sold by a limited licensee 3 29 pursuant to this section if all of the following apply: 3 30 a. The rental period of the rental agreement does not 3 31 exceed ninety consecutive days. 3 32 b. At every rental location where a rental agreement is 3 33 executed, brochures or other written materials are readily 3 34 available to a prospective renter that include all of the 3 35 following information: 4 1 (1) A clear and correct summary of the material terms of 4 2 coverage offered to renters, including the identity of the 4 3 insurer. 4 4 (2) A disclosure that the coverage offered by the rental 4 5 company may provide a duplication of coverage already provided 4 6 by a renter's personal automobile insurance policy, 4 7 homeowner's insurance policy, personal liability insurance 4 8 policy, or other source of coverage. 4 9 (3) A statement that the purchase by a renter of the types 4 10 of coverage specified in this section is not required in order 4 11 to rent a vehicle. 4 12 (4) A description of the process for filing a claim in the 4 13 event a renter elects to purchase coverage and in the event of 4 14 a claim. 4 15 c. Evidence of coverage in the rental agreement is 4 16 provided to every renter who elects to purchase such coverage. 4 17 d. A fee, compensation, or commission is not paid to an 4 18 employee by a rental company dependent based solely on the 4 19 sale of insurance under any limited license issued pursuant to 4 20 this section. 4 21 6. Any limited license issued under this section shall 4 22 authorize a counter employee of the limited licensee to act 4 23 individually on behalf, and under the supervision, of the 4 24 limited licensee with respect to the offer and sale of 4 25 coverage specified in this section. 4 26 7. A rental company counter employee must successfully 4 27 pass an examination covering the insurance products offered 4 28 for sale by the rental company in connection with and 4 29 incidental to the rental of vehicles by the rental company. 4 30 The examination shall be approved and administered by the 4 31 insurance division or a vendor approved by the insurance 4 32 division pursuant to section 522A.6. The counter employee 4 33 shall file an application with the commissioner for an 4 34 individual license. Any application shall be deemed approved 4 35 unless the commissioner notifies the rental company of the 5 1 denial or rejection of the application within thirty days of 5 2 receiving the application. An application shall not include 5 3 requirements greater in scope than defined in this section. 5 4 8. A limited licensee pursuant to this section shall not 5 5 be required to treat moneys collected from renters purchasing 5 6 insurance when renting vehicles as moneys received in a 5 7 fiduciary capacity, provided that the charges for coverage are 5 8 itemized and are ancillary to a rental agreement. The offer 5 9 or sale of insurance not in conjunction with a rental 5 10 agreement shall not be permitted. 5 11 9. A limited licensee under this section shall not 5 12 advertise, represent, or otherwise hold itself out or hold any 5 13 of its employees out as licensed insurers, insurance agents, 5 14 or insurance brokers. 5 15 10. A limited licensee shall not engage in this state in 5 16 any of the following: 5 17 a. A trade practice defined in chapter 507B as, or 5 18 determined pursuant to section 507B.6 to be, an unfair method 5 19 of competition or an unfair or deceptive act or practice in 5 20 the business of insurance. 5 21 b. An illegal sales practice or unfair trade practice as 5 22 defined in rules adopted pursuant to chapter 17A by the 5 23 commissioner. 5 24 11. An individual license, authorization, and 5 25 certification to offer or sell insurance products under this 5 26 chapter shall expire when the counter employee's employment 5 27 terminates with the rental company. 5 28 Sec. 4. NEW SECTION. 522A.4 TERM OF LIMITED LICENSE. 5 29 A limited license issued pursuant to this chapter is valid 5 30 for three years and may be renewed without examination if the 5 31 renewal application is received in a timely manner. 5 32 Sec. 5. NEW SECTION. 522A.5 FEES. 5 33 The fee for a counter employee license shall be fifty 5 34 dollars per counter employee. In no case shall any combined 5 35 fees exceed one thousand dollars in any calendar year for any 6 1 one rental company or limited license or licensee or renewal 6 2 license. 6 3 Sec. 6. NEW SECTION. 522A.6 VENDOR QUALIFICATIONS. 6 4 If a qualified vendor is available, the commissioner shall 6 5 utilize the qualified vendor closest in proximity to where the 6 6 counter employee is employed to meet the requirements in 6 7 section 522A.3. A vendor shall have at least two years 6 8 teaching experience relating to the topic of the products 6 9 described in this chapter. For purposes of this section, the 6 10 commissioner may approve a rental company that meets the 6 11 requirements of this section as a qualifying vendor to 6 12 administer the requirements in section 522A.3. 6 13 Sec. 7. NEW SECTION. 522A.7 RULES. 6 14 The commissioner shall adopt rules necessary for the 6 15 administration of this chapter. 6 16 6 17 6 18 6 19 BRENT SIEGRIST 6 20 Speaker of the House 6 21 6 22 6 23 6 24 MARY E. KRAMER 6 25 President of the Senate 6 26 6 27 I hereby certify that this bill originated in the House and 6 28 is known as House File 777, Seventy-eighth General Assembly. 6 29 6 30 6 31 6 32 ELIZABETH ISAACSON 6 33 Chief Clerk of the House 6 34 Approved , 1999 6 35 7 1 7 2 7 3 THOMAS J. VILSACK 7 4 Governor
Text: HF00776 Text: HF00778 Text: HF00700 - HF00799 Text: HF Index Bills and Amendments: General Index Bill History: General Index
© 1999 Cornell College and League of Women Voters of Iowa
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