House File 606 - Reprinted HOUSE FILE 606 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 514) (SUCCESSOR TO HSB 97) (As Amended and Passed by the House April 8, 2015 ) A BILL FOR An Act establishing a motor vehicle insurance verification 1 program, establishing fees, and including penalty and 2 effective date provisions. 3 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 4 HF 606 (3) 86 ns/nh/md

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- HF 606 (3) 86 ns/nh/md 1/ 9

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 for a period of four years. For the period of the 22 contract, the designated agent shall establish and maintain a 23 computer database containing the following information: 24 a. Information provided by insurers under section 321B.5. 25 b. Information provided by the department under subsection 26 5. 27 c. Any other information provided by the department pursuant 28 to this chapter. 29 3. The database shall be developed and maintained in 30 accordance with guidelines established by the department by 31 rule to allow authorized state and local law enforcement 32 agencies and financial institutions to efficiently access the 33 records of the database, including reports useful for the 34 implementation of this chapter. 35 -2- HF 606 (3) 86 ns/nh/md 2/ 9

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

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

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

H.F. 606 motorist coverage, underinsured motorist coverage, or 1 personal injury coverage shall, on or before the seventh 2 and twenty-first days of each calendar month, submit to the 3 department’s designated agent a record of each motor vehicle 4 insurance policy that was issued by the insurer and in effect 5 for a vehicle registered or garaged in this state as of the 6 date of the previous submission. 7 b. An insurer is not required to provide a record of a motor 8 vehicle insurance policy under paragraph “a” if the policy 9 covers a vehicle that is registered under chapter 326. 10 c. This subsection does not preclude more frequent 11 reporting. 12 2. A record provided by an insurer under subsection 1, 13 paragraph “a” , shall include all of the following: 14 a. The name, date of birth, and driver’s license number, if 15 the insured provides a driver’s license number to the insurer, 16 of each insured owner or operator, and the address of the named 17 insured. 18 b. The make, year, and vehicle identification number of each 19 insured vehicle. 20 c. The policy number and effective date of each policy. 21 3. An insurer shall provide the information required under 22 this section via electronic means or via another means the 23 designated agent agrees to accept. 24 4. a. The department may assess a civil penalty of not more 25 than two hundred fifty dollars for each day an insurer fails to 26 comply with this section. 27 b. If an insurer shows that the failure to comply with this 28 section was inadvertent, accidental, or the result of excusable 29 neglect, the department may waive the civil penalty. 30 c. An insurer that discloses records to the department’s 31 designated agent in a reasonable, good-faith effort to comply 32 with the requirements of this section shall not be subject to a 33 civil penalty under paragraph “a” . 34 Sec. 7. NEW SECTION . 321B.6 Disclosure of database 35 -6- HF 606 (3) 86 ns/nh/md 6/ 9

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

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

H.F. 606 information from the database for a purpose other than those 1 authorized in this section or to a person who is not entitled 2 to such information is guilty of a class “D” felony. 3 4. Neither the state nor the department’s designated agent 4 is liable to any person for gathering, managing, or using the 5 information in the database in compliance with this chapter. 6 Sec. 8. EFFECTIVE DATE. This Act takes effect July 1, 2016. 7 -9- HF 606 (3) 86 ns/nh/md 9/ 9