H.F. 606 Section 1. Section 321.11, subsection 3, Code 2015, is 1 amended to read as follows: 2 3. Notwithstanding other provisions of this section to the 3 contrary, the department shall not release personal information 4 to a person, other than to an officer or employee of a law 5 enforcement agency, an employee of a federal or state agency 6 or political subdivision in the performance of the employee’s 7 official duties, a contract employee of the department of 8 inspections and appeals in the conduct of an investigation, or 9 a licensed private investigation agency or a licensed security 10 service or a licensed employee of either, if the information is 11 requested by the presentation of a registration plate number. 12 However, the department may release personal information to the 13 department’s designated agent for the purposes of chapter 321B. 14 In addition, an officer or employee of a law enforcement agency 15 may release the name, address, and telephone number of a motor 16 vehicle registrant to a person requesting the information by 17 the presentation of a registration plate number if the officer 18 or employee of the law enforcement agency believes that the 19 release of the information is necessary in the performance of 20 the officer’s or employee’s duties. 21 Sec. 2. NEW SECTION . 321B.1 Short title. 22 This chapter shall be known and may be cited as the “Motor 23 Vehicle Insurance Verification Act” . 24 Sec. 3. NEW SECTION . 321B.2 Definitions. 25 As used in this chapter, unless the context otherwise 26 requires: 27 1. “Database” means the motor vehicle insurance verification 28 database created under this chapter. 29 2. “Department” means the department of transportation. 30 3. “Designated agent” means the third party with which the 31 department contracts under section 321B.3. 32 4. “Financial institution” means financial institution as 33 defined in 18 U.S.C. §20. 34 5. “Motor vehicle” means motor vehicle as defined in section 35 -1- LSB 1042HZ (2) 86 ns/nh 1/ 11

H.F. 606 321.1. 1 6. “Program” means the motor vehicle insurance verification 2 program created under this chapter. 3 Sec. 4. NEW SECTION . 321B.3 Motor vehicle insurance 4 verification program. 5 1. A motor vehicle insurance verification program is 6 created within the department to be administered by the 7 department. The purposes of the program include all of the 8 following: 9 a. To establish a motor vehicle insurance verification 10 database to verify compliance with the requirements of section 11 321.20B. 12 b. To assist in reducing the number of uninsured motor 13 vehicles on the highways of the state. 14 c. To assist in increasing compliance with motor vehicle 15 registration requirements and for other law enforcement 16 purposes. 17 d. To assist in protecting the bona fide security interests 18 of financial institutions in motor vehicles. 19 2. The department shall contract with a third party to act 20 as the department’s designated agent for administration of this 21 chapter. The designated agent shall establish and maintain a 22 computer database containing the following information: 23 a. Information provided by insurers under section 321B.5. 24 b. Information provided by the department under subsection 25 5. 26 c. Any other information provided by the department pursuant 27 to this chapter. 28 3. The database shall be developed and maintained in 29 accordance with guidelines established by the department by 30 rule to allow authorized state and local law enforcement 31 agencies and financial institutions to efficiently access the 32 records of the database, including reports useful for the 33 implementation of this chapter. 34 a. Database reports shall be in a form and contain 35 -2- LSB 1042HZ (2) 86 ns/nh 2/ 11

H.F. 606 information approved by the department. 1 b. Database reports may be made available through the 2 department’s internet site or through other electronic media 3 if the department determines that sufficient security is 4 provided to ensure compliance with the provisions of this 5 chapter regarding limitations on disclosure of information in 6 the database. 7 4. At least twice monthly, the designated agent shall do the 8 following, using information provided by the department: 9 a. Update the database with motor vehicle insurance 10 information provided by insurers in accordance with section 11 321B.5. 12 b. Compare all current motor vehicle registrations against 13 the database. 14 5. On or before the seventh day of each calendar month, the 15 department shall provide the designated agent with the make, 16 model, year, and vehicle identification number of each vehicle 17 in the department’s motor vehicle database, and the name and 18 address of each person listed on each vehicle’s registration. 19 6. The department shall adopt rules in accordance with 20 chapter 17A establishing procedures for using the department’s 21 motor vehicle database for the purposes of administering and 22 enforcing this chapter. 23 7. a. The designated agent shall archive database files at 24 least semiannually for auditing purposes. 25 b. The department shall audit the program at least annually. 26 The audit shall include verification of: 27 (1) Billings made by the designated agent. 28 (2) The accuracy of the designated agent’s matching of 29 vehicle registration records with insurance data. 30 Sec. 5. NEW SECTION . 321B.4 Enforcement of financial 31 responsibility requirements —— penalty. 32 1. If records in the database indicate that a registered 33 motor vehicle is not covered under an owner’s policy of 34 liability insurance for three consecutive months, at the 35 -3- LSB 1042HZ (2) 86 ns/nh 3/ 11

H.F. 606 direction of the department, the designated agent shall provide 1 notice by first-class mail to the owner of the motor vehicle 2 that the owner has fifteen days from the date the notice was 3 mailed to provide one of the following: 4 a. Proof of financial liability coverage as defined in 5 section 321.1, subsection 24B. 6 b. Proof that the owner is exempt from the requirement to 7 maintain proof of financial liability coverage under section 8 321.20B. 9 2. If, after fifteen days, the owner of the motor vehicle 10 fails to provide satisfactory proof of financial liability 11 coverage, the designated agent shall provide a second notice 12 by first-class mail to the owner of the motor vehicle allowing 13 the owner an additional fifteen days from the date the second 14 notice was mailed to provide the information requested under 15 subsection 1. 16 3. a. The designated agent shall update the database 17 regarding each notice sent to a motor vehicle owner under 18 subsections 1 and 2, indicating the information provided by the 19 motor vehicle owner or the owner’s failure to provide proof of 20 financial liability coverage, as applicable. 21 b. If the owner of a motor vehicle provides proof to the 22 department or the designated agent that the owner’s motor 23 vehicle is covered by an acceptable form of financial liability 24 coverage described in section 321.1, subsection 24B, paragraph 25 “b” , “c” , or “d” , the information shall be recorded in the 26 database. 27 4. a. If the owner of a motor vehicle fails to provide 28 proof of financial liability coverage following receipt of the 29 second notice under subsection 2, the designated agent shall 30 notify the department, and the department shall revoke the 31 registration of the motor vehicle. 32 b. The department shall provide to the owner of the motor 33 vehicle appropriate notice of the revocation, order the owner 34 to surrender the registration plates and registration receipt 35 -4- LSB 1042HZ (2) 86 ns/nh 4/ 11

H.F. 606 for the vehicle to the county treasurer, advise the owner of 1 the legal consequences of operating a vehicle with revoked 2 registration and without financial liability coverage, and 3 instruct the owner on how to reinstate the vehicle registration 4 once the owner has obtained financial liability coverage for 5 the vehicle. 6 5. a. A person shall not provide a false or fraudulent 7 statement to the department or the department’s designated 8 agent in regard to proceedings under this chapter. 9 b. In addition to any other penalties, a person who violates 10 paragraph “a” is guilty of a simple misdemeanor. 11 6. A revocation of registration under this chapter is in 12 addition to any other penalty imposed by law. This chapter 13 does not affect other actions or penalties that may be taken or 14 imposed for a violation of section 321.20B or other law. 15 7. a. A registration that has been revoked under this 16 section shall not be reinstated and a new registration shall 17 not be issued to the holder of the revoked registration until 18 the person does all of the following: 19 (1) Pays to the department an administrative reinstatement 20 fee of one hundred dollars, in addition to any other penalty 21 imposed by law. 22 (2) Complies with the requirements of section 321.20B and 23 this chapter. 24 b. Reinstatement fees collected under this subsection 25 shall be retained by the department as repayment receipts as 26 defined in section 8.2 and shall be used exclusively to offset 27 the costs of administering the program. Fees collected by 28 the department that are in excess of the amount necessary for 29 administration of the program shall be transferred to the road 30 use tax fund annually on June 30. 31 Sec. 6. NEW SECTION . 321B.5 Motor vehicle insurance 32 reporting —— penalty. 33 1. a. Except as provided in paragraph “b” , each insurer 34 that issues a policy to a motor vehicle owner in this state 35 -5- LSB 1042HZ (2) 86 ns/nh 5/ 11

H.F. 606 that includes motor vehicle liability coverage, uninsured 1 motorist coverage, underinsured motorist coverage, or 2 personal injury coverage shall, on or before the seventh 3 and twenty-first days of each calendar month, submit to the 4 department’s designated agent a record of each motor vehicle 5 insurance policy that was issued by the insurer and in effect 6 for a vehicle registered or garaged in this state as of the 7 date of the previous submission. 8 b. An insurer is not required to provide a record of a motor 9 vehicle insurance policy under paragraph “a” if the policy 10 covers a vehicle that is registered under chapter 326. 11 c. This subsection does not preclude more frequent 12 reporting. 13 2. A record provided by an insurer under subsection 1, 14 paragraph “a” , shall include all of the following: 15 a. The name, date of birth, and driver’s license number, if 16 the insured provides a driver’s license number to the insurer, 17 of each insured owner or operator, and the address of the named 18 insured. 19 b. The make, year, and vehicle identification number of each 20 insured vehicle. 21 c. The policy number and effective date of each policy. 22 3. An insurer shall provide the information required under 23 this section via electronic means or via another means the 24 designated agent agrees to accept. 25 4. a. The department may assess a civil penalty of not more 26 than two hundred fifty dollars for each day an insurer fails to 27 comply with this section. 28 b. If an insurer shows that the failure to comply with this 29 section was inadvertent, accidental, or the result of excusable 30 neglect, the department may waive the civil penalty. 31 c. An insurer that discloses records to the department’s 32 designated agent in a reasonable, good-faith effort to comply 33 with the requirements of this section shall not be subject to a 34 civil penalty under paragraph “a” . 35 -6- LSB 1042HZ (2) 86 ns/nh 6/ 11

H.F. 606 Sec. 7. NEW SECTION . 321B.6 Disclosure of database 1 information —— penalty. 2 1. Information provided to the designated agent and 3 information contained in the database under this chapter are 4 confidential. Such information may not be disclosed, except 5 as follows: 6 a. For the purpose of investigating, litigating, or 7 enforcing the financial liability coverage requirements 8 of section 321.20B, the designated agent shall provide an 9 electronic record to a state or local government agency or 10 court verifying motor vehicle financial liability coverage 11 information. 12 b. For the purpose of investigating, litigating, or 13 enforcing the financial liability coverage requirements of 14 section 321.20B, the designated agent shall, upon request, 15 issue to any state or local government agency or court a 16 certificate documenting motor vehicle financial liability 17 coverage, according to the database, of a specific individual 18 or motor vehicle for the time period designated by the 19 government agency or court. 20 c. Upon request, the department or its designated agent 21 shall disclose whether an individual is covered under a motor 22 vehicle insurance policy and the insurance company name to: 23 (1) The individual or, if the individual is deceased, 24 any person who is an interested party in the estate of the 25 individual as provided under chapter 633. 26 (2) The parent or legal guardian of the individual if the 27 individual is an unemancipated minor. 28 (3) The legal guardian of the individual if the individual 29 is legally incapacitated. 30 (4) A person who has power of attorney for the individual. 31 (5) A person who submits a notarized release from the 32 individual dated no more than ninety days before the date the 33 request is made. 34 (6) A person suffering loss or injury in a motor vehicle 35 -7- LSB 1042HZ (2) 86 ns/nh 7/ 11

H.F. 606 accident in which the individual was involved, but only as part 1 of an accident report as authorized in section 321.271 relating 2 to access to accident reports. 3 d. For the purpose of investigating, enforcing, or 4 prosecuting laws or issuing citations, information related to a 5 motor vehicle owner or operator’s financial liability coverage 6 under section 321.20B may be provided to state or local law 7 enforcement agencies. 8 e. Upon request of a peace officer acting in an official 9 capacity under the provisions of paragraph “d” , the department 10 or the designated agent shall, upon request, disclose relevant 11 information contained in the database. 12 f. For the purpose of the state auditor conducting audits 13 of the program. 14 g. Upon request of a financial institution for the purpose 15 of protecting the financial institution’s bona fide security 16 interest in a motor vehicle. 17 2. a. The department may allow the designated agent to 18 prepare and deliver, upon request, a report on the insurance 19 information of a person or motor vehicle in accordance with 20 this section. The report may be in the form of: 21 (1) A certified copy that is considered admissible in any 22 court proceeding in the same manner as the original. 23 (2) Information accessible through the internet or through 24 another electronic medium if the department determines that 25 sufficient security is provided to ensure compliance with this 26 section. 27 b. The department may allow the designated agent to charge a 28 fee established by the department for each of the following: 29 (1) Authenticating a document, including preparation and 30 delivery of a certified copy. 31 (2) Accessing a record through the internet or through 32 another electronic medium. 33 (3) Providing a record to a financial institution under 34 subsection 1, paragraph “g” . 35 -8- LSB 1042HZ (2) 86 ns/nh 8/ 11

H.F. 606 3. Any person who knowingly releases or discloses 1 information from the database for a purpose other than those 2 authorized in this section or to a person who is not entitled 3 to such information is guilty of a class “D” felony. 4 4. Neither the state nor the department’s designated agent 5 is liable to any person for gathering, managing, or using the 6 information in the database in compliance with this chapter. 7 Sec. 8. EFFECTIVE DATE. This Act takes effect July 1, 2016. 8 EXPLANATION 9 The inclusion of this explanation does not constitute agreement with 10 the explanation’s substance by the members of the general assembly. 11 This bill establishes a motor vehicle insurance verification 12 program within the department of transportation. The 13 department is required to contract with a third party to act 14 as the department’s designated agent for administration of the 15 program. 16 The designated agent is required to establish and maintain a 17 database containing information from insurers relating to motor 18 vehicle insurance coverage for registered motor vehicles, motor 19 vehicle identification information, personal identification 20 information for registered owners of motor vehicles, and any 21 other information provided to the designated agent by the 22 department. 23 At least twice a month, the designated agent shall update the 24 database and compare current motor vehicle registrations with 25 updated insurance information. The files in the database shall 26 be archived semiannually and audited by the department at least 27 annually. The bill requires the department to adopt rules for 28 administration of the database. 29 If database records show that a registered motor vehicle 30 is not covered under an owner’s policy of liability insurance 31 for three months, the designated agent shall send a notice to 32 the owner requiring the owner to respond within 15 days by 33 providing proof of financial liability coverage or proof that 34 the owner is exempt from the requirement to maintain financial 35 -9- LSB 1042HZ (2) 86 ns/nh 9/ 11

H.F. 606 liability coverage. If the owner fails to respond, a second 1 notice will be sent. If the owner does not respond to the 2 second notice, the owner’s motor vehicle registration will be 3 revoked by the department and the owner will be required to 4 surrender the registration plates and registration receipt for 5 the vehicle to the county treasurer. In order to obtain a 6 new registration for the vehicle, the owner must comply with 7 financial responsibility requirements and pay an administrative 8 fee of $100. The fees are to be used by the department 9 exclusively to offset the costs of administering the program. 10 Any fees in excess of the amount needed for administration of 11 the program are to be transferred to the road use tax fund 12 annually on June 30. 13 The bill provides that if a motor vehicle is covered by a 14 form of financial liability coverage other than an insurance 15 policy, that fact shall be noted in the database. 16 The bill prohibits a person from providing false or 17 fraudulent information to the department or the department’s 18 designated agent in relation to the motor vehicle insurance 19 verification program. A violation is a simple misdemeanor. 20 The bill requires each insurer that issues a policy that 21 includes motor vehicle liability coverage, uninsured motorist 22 coverage, underinsured motorist coverage, or personal injury 23 coverage to the owner of a motor vehicle to provide, before the 24 7th and the 21st of each month, to the department’s designated 25 agent a record of each motor vehicle insurance policy issued by 26 the insurer and in effect for vehicles registered or garaged in 27 this state as of the date of the previous submission. Vehicles 28 subject to apportioned registration are not included in this 29 requirement. Insurers that fail to comply with the reporting 30 requirement may be assessed a civil penalty of $250 per day. 31 However, the department may waive the penalty upon a showing 32 that the failure was inadvertent, accidental, or the result 33 of excusable neglect. An insurer that discloses records to 34 the department’s designated agent in a reasonable, good-faith 35 -10- LSB 1042HZ (2) 86 ns/nh 10/ 11

H.F. 606 effort to comply with the bill is not subject to the penalty. 1 Information contained in the database is confidential, 2 but the bill provides exceptions for disclosures to state or 3 local government agencies and courts for specified purposes; 4 to individuals and certain other authorized persons; for 5 purposes of an accident investigation; to law enforcement 6 agencies and peace officers for certain official purposes; 7 to the state auditor; and to financial institutions with a 8 security interest in a motor vehicle. The designated agent 9 may be authorized to provide certified copies or electronic 10 records, as appropriate, and to charge a fee for the provision 11 of records and authentication of documents. 12 A person who knowingly releases or discloses information 13 from the database for a purpose other than those authorized in 14 the bill or to a person who is not entitled to such information 15 is guilty of a class “D” felony. 16 The bill provides that the state and the department’s 17 designated agent are not liable to any person for gathering, 18 managing, or using the information in the database in 19 compliance with the bill. 20 The bill provides for an effective date of July 1, 2016. 21 -11- LSB 1042HZ (2) 86 ns/nh 11/ 11