S.F. 2060 Section 1. Section 321.20, subsection 1, Code 2009, is 1 amended by adding the following new paragraph: 2 NEW PARAGRAPH . g. If the vehicle is a motor vehicle, the 3 owner shall certify on the application that financial liability 4 coverage is in effect for the motor vehicle as required by 5 section 321.21. The application provided by the department 6 shall include a statement for the applicant to sign that 7 acknowledges the applicant’s knowledge of the requirement to 8 notify the county treasurer of a financial liability coverage 9 change. 10 Sec. 2. NEW SECTION . 321.21 Proof of financial liability 11 coverage required for motor vehicle registration —— penalties. 12 1. A motor vehicle shall not be registered unless financial 13 liability coverage, as defined in section 321.1, subsection 14 24B, is in effect for the motor vehicle at the time of 15 registration. If the form of financial liability coverage 16 is an owner’s policy of liability insurance, the owner shall 17 provide a description of the financial liability coverage as 18 noted on the proof of financial liability coverage card issued 19 for the motor vehicle. The department may require that the 20 owner’s insurance company verify that the financial liability 21 coverage is in effect for the motor vehicle at the time of 22 application for registration. 23 2. When the insurance carrier or other source of financial 24 liability coverage for a vehicle changes, the owner shall 25 notify the county treasurer within five days of obtaining the 26 new coverage. If liability insurance for the motor vehicle 27 is canceled or terminated at any time during the period of 28 registration for a reason other than transfer of ownership 29 of the motor vehicle, and new coverage is not obtained, the 30 owner shall immediately surrender the registration certificate 31 and registration plates for the motor vehicle to the county 32 treasurer. 33 3. An insurance company shall notify the department within 34 twenty business days of the cancellation or termination of 35 -1- LSB 5566XS (3) 83 dea/nh 1/ 5

S.F. 2060 an owner’s policy of liability insurance. However, notice 1 of cancellation is not required if the insurer cancels or 2 terminates the old policy, no lapse in coverage results, and 3 the insurer sends the certificate of insurance form for the new 4 policy to the department. 5 4. a. Upon receiving notice of a lapse in insurance 6 coverage for a motor vehicle, the department shall notify the 7 owner of the lapse in coverage and require the owner to do one 8 of the following within five days of the notification: 9 (1) Certify to the department that other financial 10 liability coverage was in effect prior to the date of 11 termination of the insurance coverage. 12 (2) If a lapse in coverage occurred, certify that new 13 financial liability coverage is in effect and, if the lapse was 14 for more than five business days, pay a civil penalty of fifty 15 dollars to the department. 16 (3) Surrender the registration receipt and registration 17 plates for the motor vehicle to the county treasurer. 18 b. Failure of the owner to certify that financial 19 liability coverage is in effect is prima facie evidence 20 that such coverage does not exist, and unless the owner has 21 surrendered the registration receipt and plates, the department 22 shall revoke the registration for the vehicle. A revoked 23 registration may be renewed after thirty days upon payment of 24 a $50 civil penalty to the department and certification that 25 financial liability coverage is in effect for the vehicle. 26 c. The department shall provide notice of a revoked 27 registration under this section to a peace officer verifying 28 the registration of a motor vehicle. 29 5. The department shall waive the civil penalties imposed 30 by this section for an owner who, at the time of notification 31 of a lapse in financial liability coverage, is in the military 32 service of the United States and has been deployed outside the 33 continental United States for a period of forty-five days or 34 more. Upon receiving notice of revocation of registration due 35 -2- LSB 5566XS (3) 83 dea/nh 2/ 5

S.F. 2060 to a lapse in coverage, the owner shall be allowed to transfer 1 the vehicle’s ownership and registration to the owner’s spouse 2 or child without penalty. 3 6. a. A person who falsely certifies as to financial 4 liability coverage required under this section commits a simple 5 misdemeanor. 6 b. The owner of a motor vehicle subject to registration who 7 permits the vehicle to be operated by another person without 8 having financial liability coverage in effect as required under 9 this section commits a simple misdemeanor. 10 Sec. 3. Section 321.30, Code 2009, is amended by adding the 11 following new subsection: 12 NEW SUBSECTION . 4. The department or the county treasurer 13 shall refuse registration of a motor vehicle if the owner does 14 not provide satisfactory certification that financial liability 15 coverage is in effect for the motor vehicle as required by 16 section 321.21. 17 Sec. 4. Section 321.40, Code Supplement 2009, is amended by 18 adding the following new subsection: 19 NEW SUBSECTION . 7A. A form for certification of financial 20 liability coverage shall accompany each renewal statement 21 sent to the owner of a motor vehicle under this section. The 22 county treasurer shall refuse to renew the registration of a 23 motor vehicle if the applicant does not submit certification of 24 financial liability coverage in effect for the motor vehicle 25 as required by section 321.21. 26 Sec. 5. NEW SECTION . 516B.4 Reports to state department of 27 transportation. 28 An insurance company transacting business in this state 29 shall provide certification of automobile liability policies 30 as required pursuant to section 321.21 within seven business 31 days of receiving a request from the state department of 32 transportation. An insurance company shall notify the 33 department of transportation within twenty business days of the 34 cancellation or termination of an automobile liability policy. 35 -3- LSB 5566XS (3) 83 dea/nh 3/ 5

S.F. 2060 EXPLANATION 1 This bill requires the owner of a motor vehicle to certify 2 that financial liability coverage is in effect for the vehicle 3 as a condition for registration of the vehicle. Certification 4 is required at the time of application for registration and 5 for registration renewal. The owner is required to notify 6 the county treasurer of any change in coverage within five 7 days of obtaining the new coverage. If coverage is canceled 8 or terminated and new coverage is not obtained, the owner is 9 required to surrender the vehicle’s registration certificate 10 and registration plates to the county treasurer. 11 The bill authorizes the department of transportation to 12 require an insurance carrier to verify financial liability 13 coverage certified by an owner, and requires an insurance 14 carrier to notify the department within 20 business days of the 15 cancellation or termination of an owner’s liability insurance 16 policy. The notification is not required if the insurance 17 carrier sends a new certificate of insurance form for a new 18 policy covering the vehicle to the department. 19 When the department is notified by an insurance carrier of 20 a lapse in coverage, the department shall provide notice to 21 the motor vehicle owner of the need to either certify that 22 other coverage was in effect prior to the termination of the 23 insurance policy; certify that new coverage is in effect 24 following the lapse, and if the lapse was for more than five 25 business days, pay a civil penalty of $50; or surrender the 26 registration receipt and plates for the motor vehicle to the 27 county treasurer. If the owner fails to certify financial 28 liability coverage or to surrender the registration receipt 29 and plates within five days of receipt of the notice, the 30 department shall revoke the motor vehicle registration. 31 Registration may be renewed after 30 days, upon certification 32 that financial liability coverage has been obtained and payment 33 of a $50 civil penalty to the department. 34 The bill requires the department to flag the registration 35 -4- LSB 5566XS (3) 83 dea/nh 4/ 5

S.F. 2060 information available to peace officers when a registration is 1 revoked due to a lapse in financial liability coverage. 2 The bill requires the department to waive any civil 3 penalties relating to a lapse in financial liability coverage 4 for a member of the military service of the United States who 5 has been deployed outside the continental United States for 6 45 days or more. Such an owner whose registration has been 7 revoked because of a lapse in insurance coverage shall be 8 allowed to transfer ownership and registration of the motor 9 vehicle to the owner’s spouse or child without penalty. 10 The bill provides that the owner of a motor vehicle commits 11 a simple misdemeanor if the owner permits the vehicle to be 12 operated by another person without having financial liability 13 coverage in effect for the vehicle. In addition, a person who 14 falsely certifies as to financial liability coverage required 15 for registration or renewal commits a simple misdemeanor. A 16 simple misdemeanor is punishable by confinement for no more 17 than 30 days or a fine of at least $65 but not more than $625, 18 or by both. 19 -5- LSB 5566XS (3) 83 dea/nh 5/ 5