H.F. 604 Section 1. Section 321.11, subsection 3, Code 2017, 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. “Advisory council” means the group established pursuant 28 to section 321B.3, subsection 2. 29 2. “Database” means the motor vehicle insurance verification 30 database created under this chapter. 31 3. “Department” means the department of transportation. 32 4. “Designated agent” means the third party with which the 33 department contracts under section 321B.3. 34 5. “Financial institution” means financial institution as 35 -1- LSB 2632HV (3) 87 ns/nh 1/ 14

H.F. 604 defined in 18 U.S.C. §20. 1 6. “Motor vehicle” means motor vehicle as defined in section 2 321.1. 3 7. “Program” means the motor vehicle insurance verification 4 program created under this chapter. 5 8. “Real-time internet services model” means an electronic 6 service established by insurers through the internet, the 7 world wide web, or a similar proprietary or common carrier 8 electronic system that complies with the specifications and 9 standards of the insurance industry committee on motor vehicle 10 administration and that is available twenty-four hours per 11 day, seven days per week, subject to reasonable allowances for 12 scheduled maintenance or temporary system failures. 13 Sec. 4. NEW SECTION . 321B.3 Motor vehicle insurance 14 verification program —— advisory council. 15 1. A motor vehicle insurance verification program is 16 created within the department to be administered by the 17 department. The purposes of the program include all of the 18 following: 19 a. To establish a motor vehicle insurance verification 20 database to verify compliance with the requirements of section 21 321.20B. 22 b. To assist in reducing the number of uninsured motor 23 vehicles on the highways of the state. 24 c. To assist in increasing compliance with motor vehicle 25 registration requirements and for other law enforcement 26 purposes. 27 d. To assist in protecting the bona fide security interests 28 of financial institutions in motor vehicles. 29 2. a. The department shall establish an advisory council, 30 chaired by the director of the department or a representative 31 of the department appointed by the director, consisting of 32 six members including the director of the department or the 33 representative of the department appointed by the director, 34 a representative of the department of public safety, an 35 -2- LSB 2632HV (3) 87 ns/nh 2/ 14

H.F. 604 insurance company representative appointed by the commissioner 1 of insurance, an insurance agent appointed by the commissioner 2 of insurance, a representative of a trade association of 3 property and casualty insurers appointed by the commissioner 4 of insurance, and a representative of a vendor with experience 5 implementing real-time internet services models and databases 6 similar to the database created under this chapter appointed by 7 the director of the department. 8 b. The advisory council shall do all of the following: 9 (1) Make recommendations to the department on the best 10 methods and practices for implementing a real-time internet 11 services model for insurance verification. 12 (2) Assist in the development of a guide for insurers 13 detailing the data fields and other information necessary for 14 compliance with this chapter. 15 (3) Provide an annual report to the department detailing the 16 improvements and implementation efforts relating to insurance 17 verification in other states for consideration in improving 18 compliance and operations in this state. 19 3. Following the competitive bidding procedures as provided 20 in chapter 8A, subchapter III, the department shall contract 21 with a third party to act as the department’s designated agent 22 for administration of this chapter. For the period of the 23 contract, the designated agent shall establish and maintain a 24 computer database containing the following information: 25 a. Information provided by insurers under section 321B.5. 26 b. Information provided by the department under subsection 27 6. 28 c. Information obtained using a real-time internet services 29 model. 30 d. Any other information provided by the department pursuant 31 to this chapter. 32 4. The database shall be developed and maintained, and 33 access to a real-time internet services model shall be 34 provided, in accordance with guidelines established by the 35 -3- LSB 2632HV (3) 87 ns/nh 3/ 14

H.F. 604 department by rule to allow authorized state and local law 1 enforcement agencies and financial institutions to efficiently 2 access the records of the database and real-time internet 3 services model, including reports useful for the implementation 4 of this chapter, twenty-four hours per day, seven days 5 per week, subject to reasonable allowances for scheduled 6 maintenance or temporary system failures. 7 a. Database reports shall be in a form and contain 8 information approved by the department. 9 b. Database reports may be made available through the 10 department’s internet site or through other electronic media 11 if the department determines that sufficient security is 12 provided to ensure compliance with the provisions of this 13 chapter regarding limitations on disclosure of information in 14 the database. 15 c. The department shall consult with the chief information 16 officer appointed under section 8B.2 for the purpose of 17 developing network security requirements for the database. 18 5. At least twice monthly, the designated agent shall do the 19 following, using information provided by the department: 20 a. Update the database with motor vehicle insurance 21 information provided by insurers in accordance with section 22 321B.5. 23 b. Compare all current motor vehicle registrations against 24 the database. If records in the database indicate that a 25 registered motor vehicle is not covered under an owner’s 26 policy of liability insurance, the designated agent shall 27 use a real-time internet services model to determine if the 28 registered motor vehicle is covered under an owner’s policy of 29 liability insurance. 30 6. On or before the seventh day of each calendar month, the 31 department shall provide the designated agent with the make, 32 model, year, and vehicle identification number of each vehicle 33 in the department’s motor vehicle database, and the name and 34 address of each person listed on each vehicle’s registration. 35 -4- LSB 2632HV (3) 87 ns/nh 4/ 14

H.F. 604 7. The department shall adopt rules in accordance with 1 chapter 17A establishing procedures for the use of the 2 department’s motor vehicle database for the purposes of 3 administering and enforcing this chapter. 4 8. a. The designated agent shall archive database files at 5 least semiannually for auditing purposes. 6 b. The department shall audit the program at least annually. 7 The audit shall include verification of: 8 (1) Billings made by the designated agent. 9 (2) The accuracy of the designated agent’s matching of 10 vehicle registration records with insurance data. 11 Sec. 5. NEW SECTION . 321B.4 Enforcement of financial 12 responsibility requirements —— penalty. 13 1. If records in the database and the real-time internet 14 services model used by the designated agent indicate that a 15 registered motor vehicle is not covered under an owner’s policy 16 of liability insurance for three consecutive months, at the 17 direction of the department the designated agent shall provide 18 notice by first-class mail to the owner of the motor vehicle 19 that the owner has fifteen days from the date the notice was 20 mailed to provide one of the following: 21 a. Proof of financial liability coverage as defined in 22 section 321.1, subsection 24B. 23 b. Proof that the owner is exempt from the requirement to 24 maintain proof of financial liability coverage under section 25 321.20B. 26 2. If, after fifteen days, the owner of the motor vehicle 27 fails to provide satisfactory proof of financial liability 28 coverage, the designated agent shall provide a second notice 29 by first-class mail to the owner of the motor vehicle allowing 30 the owner an additional fifteen days from the date the second 31 notice was mailed to provide the information requested under 32 subsection 1. 33 3. a. The designated agent shall update the database 34 regarding each notice sent to a motor vehicle owner under 35 -5- LSB 2632HV (3) 87 ns/nh 5/ 14

H.F. 604 subsections 1 and 2, indicating the information provided by the 1 motor vehicle owner or the owner’s failure to provide proof of 2 financial liability coverage, as applicable. 3 b. If the owner of a motor vehicle provides proof to the 4 department or the designated agent that the owner’s motor 5 vehicle is covered by an acceptable form of financial liability 6 coverage described in section 321.1, subsection 24B, paragraph 7 “b” , “c” , or “d” , the information shall be recorded in the 8 database. 9 c. If the designated agent determines the motor vehicle 10 is appropriately insured using a real-time internet services 11 model, the information shall be recorded in the database. 12 4. a. If the owner of a motor vehicle fails to provide 13 proof of financial liability coverage following receipt of the 14 second notice under subsection 2, the designated agent shall 15 notify the department, and the department shall suspend the 16 registration of the motor vehicle. 17 b. The department shall provide to the owner of the motor 18 vehicle appropriate notice of the suspension, order the owner 19 to surrender the registration plates and registration receipt 20 for the vehicle to the county treasurer, advise the owner of 21 the legal consequences of operating a vehicle with a suspended 22 registration and without financial liability coverage, and 23 instruct the owner on how to reinstate the vehicle registration 24 once the owner has obtained financial liability coverage for 25 the vehicle. 26 5. a. A person shall not provide a false or fraudulent 27 statement to the department or the department’s designated 28 agent in regard to proceedings under this chapter. 29 b. In addition to any other penalties, a person who violates 30 paragraph “a” is guilty of a simple misdemeanor. 31 6. A suspension of registration under this chapter is in 32 addition to any other penalty imposed by law. This chapter 33 does not affect other actions or penalties that may be taken or 34 imposed for a violation of section 321.20B or other law. 35 -6- LSB 2632HV (3) 87 ns/nh 6/ 14

H.F. 604 7. a. A registration that has been suspended under this 1 section shall not be reinstated and a registration shall not be 2 issued to the holder of the suspended registration until the 3 person does all of the following: 4 (1) Pays to the department an administrative reinstatement 5 fee of one hundred dollars, in addition to any other penalty 6 imposed by law. 7 (2) Complies with the requirements of section 321.20B and 8 this chapter. 9 b. Reinstatement fees collected under this subsection shall 10 be retained by the department as repayment receipts as defined 11 in section 8.2 and shall be used exclusively to offset the 12 costs of administering the program, including payments made by 13 the department to the department’s designated agent. 14 Sec. 6. NEW SECTION . 321B.5 Motor vehicle insurance 15 reporting —— penalty. 16 1. a. Except as provided in paragraph “b” , each insurer 17 that issues a policy to a motor vehicle owner in this state 18 that includes motor vehicle liability coverage, uninsured 19 motorist coverage, underinsured motorist coverage, or 20 personal injury coverage shall, on or before the seventh 21 and twenty-first days of each calendar month, submit to the 22 department’s designated agent a record of each motor vehicle 23 insurance policy that was issued by the insurer and in effect 24 for a vehicle registered or garaged in this state as of the 25 date of the previous submission. 26 b. An insurer is not required to provide a record of a motor 27 vehicle insurance policy under paragraph “a” if the policy 28 covers a vehicle that is registered under chapter 326. 29 c. This subsection does not preclude more frequent 30 reporting. 31 2. A record provided by an insurer under subsection 1, 32 paragraph “a” , shall include all of the following: 33 a. The name, date of birth, and driver’s license number, if 34 the insured provides a driver’s license number to the insurer, 35 -7- LSB 2632HV (3) 87 ns/nh 7/ 14

H.F. 604 of each insured owner or operator, and the address of the named 1 insured. 2 b. The make, year, and vehicle identification number of each 3 insured vehicle. 4 c. The policy number and effective date of each policy. 5 3. An insurer shall provide the information required under 6 this section via electronic means or via another means the 7 designated agent agrees to accept. 8 4. a. The department may assess a civil penalty of not more 9 than two hundred fifty dollars for each day an insurer fails to 10 comply with this section. 11 b. If an insurer shows that the failure to comply with this 12 section was inadvertent, accidental, or the result of excusable 13 neglect, the department may waive the civil penalty. 14 c. An insurer that discloses records to the department’s 15 designated agent in a reasonable, good-faith effort to comply 16 with the requirements of this section shall not be subject to a 17 civil penalty under paragraph “a” . 18 Sec. 7. NEW SECTION . 321B.6 Disclosure of database 19 information —— penalty. 20 1. Information provided to the designated agent and 21 information contained in the database under this chapter are 22 confidential and subject to the provisions and penalties of 18 23 U.S.C. §2721. Such information may not be disclosed, except 24 as follows: 25 a. For the purpose of investigating, litigating, or 26 enforcing the financial liability coverage requirements 27 of section 321.20B, the designated agent shall provide an 28 electronic record to a state or local government agency or 29 court verifying motor vehicle financial liability coverage 30 information. 31 b. For the purpose of investigating, litigating, or 32 enforcing the financial liability coverage requirements of 33 section 321.20B, the designated agent shall, upon request, 34 issue to any state or local government agency or court a 35 -8- LSB 2632HV (3) 87 ns/nh 8/ 14

H.F. 604 certificate documenting motor vehicle financial liability 1 coverage, according to the database, of a specific individual 2 or motor vehicle for the time period designated by the 3 government agency or court. 4 c. Upon request, the department or its designated agent 5 shall disclose whether an individual is covered under a motor 6 vehicle insurance policy, proof of the insurance coverage 7 policy, and the insurance company name to: 8 (1) The individual or, if the individual is deceased, 9 any person who is an interested party in the estate of the 10 individual as provided under chapter 633. 11 (2) The parent or legal guardian of the individual if the 12 individual is an unemancipated minor. 13 (3) The legal guardian of the individual if the individual 14 is legally incapacitated. 15 (4) A person who has power of attorney for the individual. 16 (5) A person who submits a notarized release from the 17 individual dated no more than ninety days before the date the 18 request is made. 19 (6) A person suffering loss or injury in a motor vehicle 20 accident in which the individual was involved, but only as part 21 of an accident report as authorized in section 321.271 relating 22 to access to accident reports. 23 d. For the purpose of investigating, enforcing, or 24 prosecuting laws or issuing citations, information related to a 25 motor vehicle owner or operator’s financial liability coverage 26 under section 321.20B may be provided to state or local law 27 enforcement agencies. 28 e. Upon request of a peace officer acting in an official 29 capacity under the provisions of paragraph “d” , the department 30 or the designated agent shall, upon request, disclose relevant 31 information contained in the database. 32 f. For the purpose of the state auditor conducting audits 33 of the program. 34 g. Upon request of a financial institution for the purpose 35 -9- LSB 2632HV (3) 87 ns/nh 9/ 14

H.F. 604 of protecting the financial institution’s bona fide security 1 interest in a motor vehicle. 2 2. a. The department may allow the designated agent to 3 prepare and deliver, upon request, a report on the insurance 4 information of a person or motor vehicle in accordance with 5 this section. The report may be in the form of: 6 (1) A certified copy that is considered admissible in any 7 court proceeding in the same manner as the original. 8 (2) Information accessible through the internet or through 9 another electronic medium if the department determines that 10 sufficient security is provided to ensure compliance with this 11 section. 12 b. The department may allow the designated agent to charge a 13 fee established by the department for each of the following: 14 (1) Authenticating a document, including preparation and 15 delivery of a certified copy. 16 (2) Accessing a record through the internet or through 17 another electronic medium. 18 (3) Providing a record to a financial institution under 19 subsection 1, paragraph “g” . 20 3. The designated agent or any other person who knowingly 21 releases or discloses information from the database for a 22 purpose other than those authorized in this section or to a 23 person who is not entitled to such information is guilty of a 24 class “D” felony. 25 4. Neither the state nor the department’s designated agent 26 shall be liable to any person for gathering, managing, or 27 using the information in the database in compliance with this 28 chapter. 29 5. The designated agent shall be responsible for 30 maintaining and securing the information in the database 31 provided by the department and insurers under sections 321B.3 32 and 321B.5. 33 6. An insurer acting in compliance with this chapter shall 34 not be liable to any person for the disclosure of information 35 -10- LSB 2632HV (3) 87 ns/nh 10/ 14

H.F. 604 supplied to the department or designated agent. The designated 1 agent shall indemnify an insurer against any loss arising from 2 the disclosure of information supplied to the department or 3 designated agent, provided the insurer supplied the information 4 to the department or designated agent in a manner that complies 5 with this chapter and rules adopted pursuant to this chapter. 6 Records provided by an insurer under this chapter shall be 7 deemed evidence of insurance and not a guarantee of insurance. 8 Sec. 8. EFFECTIVE DATE. This Act takes effect July 1, 2019. 9 EXPLANATION 10 The inclusion of this explanation does not constitute agreement with 11 the explanation’s substance by the members of the general assembly. 12 This bill establishes a motor vehicle insurance verification 13 program to be administered by the department of transportation 14 (DOT). Following the appropriate competitive bidding 15 procedures, the DOT is required to contract with a third party 16 to act as the DOT’s designated agent for administration of the 17 program. 18 The bill requires the DOT to establish an advisory council 19 to make recommendations to the DOT on the best methods and 20 practices for implementing a real-time internet services model 21 for insurance verification, to assist in the development of 22 a guide for insurers detailing the data fields and other 23 information necessary for compliance with the bill, and to 24 provide an annual report to the DOT detailing the improvements 25 and implementation efforts relating to insurance verification 26 in other states for consideration in improving compliance and 27 operations in this state. 28 The designated agent is required to establish and maintain a 29 database containing information from insurers relating to motor 30 vehicle insurance coverage for registered motor vehicles, motor 31 vehicle identification information, personal identification 32 information for registered owners of motor vehicles, and any 33 other information provided to the designated agent by the DOT. 34 At least twice per month, the designated agent must update the 35 -11- LSB 2632HV (3) 87 ns/nh 11/ 14

H.F. 604 database and compare current motor vehicle registrations with 1 updated insurance information. If records in the database 2 indicate that a registered motor vehicle is not covered under 3 an owner’s policy of liability insurance, the bill requires the 4 designated agent to use a real-time internet services model 5 to determine if the registered motor vehicle is covered under 6 an owner’s policy of liability insurance. The files in the 7 database must be archived semiannually and audited by the DOT 8 at least annually. 9 If database records and the real-time internet services 10 model show that a registered motor vehicle is not covered under 11 an owner’s policy of liability insurance for three consecutive 12 months, the designated agent is required to send a notice 13 to the owner requiring the owner to respond within 15 days 14 by providing proof of financial liability coverage or proof 15 that the owner is exempt from the requirement to maintain 16 financial liability coverage. If the owner fails to respond, 17 a second notice must be sent. If the owner does not respond 18 to the second notice, the owner’s motor vehicle registration 19 must be suspended by the DOT and the owner is required to 20 surrender the registration plates and registration receipt for 21 the vehicle to the county treasurer. In order to reinstate 22 the registration for the vehicle, the owner must comply with 23 financial responsibility requirements and pay an administrative 24 fee of $100. The fees collected are to be used by the DOT 25 exclusively to offset the costs of administering the program, 26 including payments made to the designated agent. 27 The bill provides that if a motor vehicle is covered by a 28 form of financial liability coverage other than an insurance 29 policy, or if a real-time internet services model indicates a 30 vehicle is appropriately insured, that fact shall be noted in 31 the database. 32 The bill prohibits a person from providing false or 33 fraudulent information to the DOT or the DOT’s designated 34 agent in relation to the motor vehicle insurance verification 35 -12- LSB 2632HV (3) 87 ns/nh 12/ 14

H.F. 604 program. A violation of this provision is a simple 1 misdemeanor. 2 The bill requires each insurer that issues a policy to the 3 owner of a motor vehicle that includes motor vehicle liability 4 coverage, uninsured motorist coverage, underinsured motorist 5 coverage, or personal injury coverage to, before the 7th and 6 the 21st of each month, provide the DOT’s designated agent with 7 a record of each motor vehicle insurance policy issued by the 8 insurer and in effect for vehicles registered or garaged in 9 the state as of the date of the previous submission. Vehicles 10 subject to apportioned registration under Code chapter 326 are 11 not included in this requirement. Insurers that fail to comply 12 with the reporting requirement may be assessed a civil penalty 13 of $250 per day. However, the DOT may waive the penalty upon a 14 showing that the failure was inadvertent, accidental, or the 15 result of excusable neglect. An insurer that discloses records 16 to the DOT’s designated agent in a reasonable, good-faith 17 effort to comply with the bill is not subject to the penalty. 18 Information contained in the database is confidential, but 19 the bill provides exceptions for certain disclosures, including 20 disclosures to state or local government agencies and courts 21 for specified purposes, to individuals and certain other 22 authorized persons, for purposes of an accident investigation, 23 to law enforcement agencies and peace officers for certain 24 official purposes, to the state auditor, and to financial 25 institutions with a security interest in a motor vehicle. 26 The designated agent may be authorized by the DOT to provide 27 certified copies or electronic records, as appropriate, and to 28 charge a fee for the provision of records and authentication 29 of documents. 30 A person, including the designated agent, who knowingly 31 releases or discloses information from the database for a 32 purpose other than those authorized in the bill or to a person 33 who is not entitled to such information is guilty of a class 34 “D” felony. 35 -13- LSB 2632HV (3) 87 ns/nh 13/ 14

H.F. 604 The bill provides that the state and the DOT’s designated 1 agent are not liable to any person for gathering, managing, or 2 using the information in the database in compliance with the 3 bill. The bill further provides that the designated agent is 4 responsible for maintaining and securing the information in the 5 database provided by the DOT and insurers, and insurers acting 6 in compliance with the bill are not liable to any person for 7 the disclosure of information supplied to the DOT or designated 8 agent. The designated agent is required to indemnify an 9 insurer against any loss arising from a disclosure, provided 10 the insurer supplied the information in compliance with the 11 bill. 12 The bill takes effect July 1, 2019. 13 -14- LSB 2632HV (3) 87 ns/nh 14/ 14