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House Study Bill 75 - IntroducedA Bill ForAn Act 1establishing a motor vehicle insurance verification
2program, establishing fees, and including penalty and
3effective date provisions.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 321.11, subsection 3, Code 2017, is
2amended to read as follows:
33. Notwithstanding other provisions of this section to the
4contrary, the department shall not release personal information
5to a person, other than to an officer or employee of a law
6enforcement agency, an employee of a federal or state agency
7or political subdivision in the performance of the employee’s
8official duties, a contract employee of the department of
9inspections and appeals in the conduct of an investigation, or
10a licensed private investigation agency or a licensed security
11service or a licensed employee of either, if the information is
12requested by the presentation of a registration plate number.
13However, the department may release personal information to the
14department’s designated agent for the purposes of chapter 321B.
15 In addition, an officer or employee of a law enforcement agency
16may release the name, address, and telephone number of a motor
17vehicle registrant to a person requesting the information by
18the presentation of a registration plate number if the officer
19or employee of the law enforcement agency believes that the
20release of the information is necessary in the performance of
21the officer’s or employee’s duties.
22 Sec. 2. NEW SECTION. 321B.1 Short title.
23This chapter shall be known and may be cited as the “Motor
24Vehicle Insurance Verification Act”.
25 Sec. 3. NEW SECTION. 321B.2 Definitions.
26As used in this chapter, unless the context otherwise
27requires:
281. “Advisory council” means the group established pursuant
29to section 321B.3, subsection 2.
302. “Database” means the motor vehicle insurance verification
31database created under this chapter.
323. “Department” means the department of transportation.
334. “Designated agent” means the third party with which the
34department contracts under section 321B.3.
355. “Financial institution” means financial institution as
-1-1defined in 18 U.S.C.§20.
26. “Motor vehicle” means motor vehicle as defined in section
3321.1.
47. “Program” means the motor vehicle insurance verification
5program created under this chapter.
68. “Real-time internet services model” means an electronic
7service established by insurers through the internet, the
8world wide web, or a similar proprietary or common carrier
9electronic system that complies with the specifications and
10standards of the insurance industry committee on motor vehicle
11administration and that is available twenty-four hours per
12day, seven days per week, subject to reasonable allowances for
13scheduled maintenance or temporary system failures.
14 Sec. 4. NEW SECTION. 321B.3 Motor vehicle insurance
15verification program — advisory council.
161. A motor vehicle insurance verification program is
17created within the department to be administered by the
18department. The purposes of the program include all of the
19following:
20a. To establish a motor vehicle insurance verification
21database to verify compliance with the requirements of section
22321.20B.
23b. To assist in reducing the number of uninsured motor
24vehicles on the highways of the state.
25c. To assist in increasing compliance with motor vehicle
26registration requirements and for other law enforcement
27purposes.
28d. To assist in protecting the bona fide security interests
29of financial institutions in motor vehicles.
302. a. The department shall establish an advisory council,
31chaired by the director of the department or a representative
32of the department appointed by the director, consisting of
33six members including the director of the department or the
34representative of the department appointed by the director,
35a representative of the department of public safety, an
-2-1insurance company representative appointed by the commissioner
2of insurance, an insurance agent appointed by the commissioner
3of insurance, a representative of a trade association of
4property and casualty insurers appointed by the commissioner
5of insurance, and a representative of a vendor with experience
6implementing real-time internet services models and databases
7similar to the database created under this chapter appointed by
8the director of the department
9b. The advisory council shall do all of the following:
10(1) Make recommendations to the department on the best
11methods and practices for implementing a real-time internet
12services model for insurance verification.
13(2) Assist in the development of a guide for insurers
14detailing the data fields and other information necessary for
15compliance with this chapter.
16(3) Provide an annual report to the department detailing the
17improvements and implementation efforts relating to insurance
18verification in other states for consideration in improving
19compliance and operations in this state.
203. The department shall contract with a third party to act
21as the department’s designated agent for administration of this
22chapter for a period of four years. For the period of the
23contract, the designated agent shall establish and maintain a
24computer database containing the following information:
25a. Information provided by insurers under section 321B.5.
26b. Information provided by the department under subsection
276.
28c. Information obtained using a real-time internet services
29model.
30d. Any other information provided by the department pursuant
31to this chapter.
324. The database shall be developed and maintained, and
33access to a real-time internet services model shall be
34provided, in accordance with guidelines established by the
35department by rule to allow authorized state and local law
-3-1enforcement agencies and financial institutions to efficiently
2access the records of the database and real-time internet
3services model, including reports useful for the implementation
4of this chapter, twenty-four hours per day, seven days
5per week, subject to reasonable allowances for scheduled
6maintenance or temporary system failures.
7a. Database reports shall be in a form and contain
8information approved by the department.
9b. Database reports may be made available through the
10department’s internet site or through other electronic media
11if the department determines that sufficient security is
12provided to ensure compliance with the provisions of this
13chapter regarding limitations on disclosure of information in
14the database.
15c. The department shall consult with the chief information
16officer appointed under section 8B.2 for the purpose of
17developing network security requirements for the database.
185. At least twice monthly, the designated agent shall do the
19following, using information provided by the department:
20a. Update the database with motor vehicle insurance
21information provided by insurers in accordance with section
22321B.5.
23b. Compare all current motor vehicle registrations against
24the database. If records in the database indicate that a
25registered motor vehicle is not covered under an owner’s
26policy of liability insurance, the designated agent shall
27use a real-time internet services model to determine if the
28registered motor vehicle is covered under an owner’s policy of
29liability insurance.
306. On or before the seventh day of each calendar month, the
31department shall provide the designated agent with the make,
32model, year, and vehicle identification number of each vehicle
33in the department’s motor vehicle database, and the name and
34address of each person listed on each vehicle’s registration.
357. The department shall adopt rules in accordance with
-4-1chapter 17A establishing procedures for the use of the
2department’s motor vehicle database for the purposes of
3administering and enforcing this chapter.
48. a. The designated agent shall archive database files at
5least semiannually for auditing purposes.
6b. The department shall audit the program at least annually.
7The audit shall include verification of:
8(1) Billings made by the designated agent.
9(2) The accuracy of the designated agent’s matching of
10vehicle registration records with insurance data.
11 Sec. 5. NEW SECTION. 321B.4 Enforcement of financial
12responsibility requirements — penalty.
131. If records in the database and the real-time internet
14services model used by the designated agent indicate that a
15registered motor vehicle is not covered under an owner’s policy
16of liability insurance for three consecutive months, at the
17direction of the department the designated agent shall provide
18notice by first-class mail to the owner of the motor vehicle
19that the owner has fifteen days from the date the notice was
20mailed to provide one of the following:
21a. Proof of financial liability coverage as defined in
22section 321.1, subsection 24B.
23b. Proof that the owner is exempt from the requirement to
24maintain proof of financial liability coverage under section
25321.20B.
262. If, after fifteen days, the owner of the motor vehicle
27fails to provide satisfactory proof of financial liability
28coverage, the designated agent shall provide a second notice
29by first-class mail to the owner of the motor vehicle allowing
30the owner an additional fifteen days from the date the second
31notice was mailed to provide the information requested under
32subsection 1.
333. a. The designated agent shall update the database
34regarding each notice sent to a motor vehicle owner under
35subsections 1 and 2, indicating the information provided by the
-5-1motor vehicle owner or the owner’s failure to provide proof of
2financial liability coverage, as applicable.
3b. If the owner of a motor vehicle provides proof to the
4department or the designated agent that the owner’s motor
5vehicle is covered by an acceptable form of financial liability
6coverage described in section 321.1, subsection 24B, paragraph
7“b”, “c”, or “d”, the information shall be recorded in the
8database.
9c. If the designated agent determines the motor vehicle
10is appropriately insured using a real-time internet services
11model, the information shall be recorded in the database.
124. a. If the owner of a motor vehicle fails to provide
13proof of financial liability coverage following receipt of the
14second notice under subsection 2, the designated agent shall
15notify the department, and the department shall revoke the
16registration of the motor vehicle.
17b. The department shall provide to the owner of the motor
18vehicle appropriate notice of the revocation, order the owner
19to surrender the registration plates and registration receipt
20for the vehicle to the county treasurer, advise the owner of
21the legal consequences of operating a vehicle with revoked
22registration and without financial liability coverage, and
23instruct the owner on how to reinstate the vehicle registration
24once the owner has obtained financial liability coverage for
25the vehicle.
265. a. A person shall not provide a false or fraudulent
27statement to the department or the department’s designated
28agent in regard to proceedings under this chapter.
29b. In addition to any other penalties, a person who violates
30paragraph “a” is guilty of a simple misdemeanor.
316. A revocation of registration under this chapter is in
32addition to any other penalty imposed by law. This chapter
33does not affect other actions or penalties that may be taken or
34imposed for a violation of section 321.20B or other law.
357. a. A registration that has been revoked under this
-6-1section shall not be reinstated and a new registration shall
2not be issued to the holder of the revoked registration until
3the person does all of the following:
4(1) Pays to the department an administrative reinstatement
5fee of one hundred dollars, in addition to any other penalty
6imposed by law.
7(2) Complies with the requirements of section 321.20B and
8this chapter.
9b. Reinstatement fees collected under this subsection shall
10be retained by the department as repayment receipts as defined
11in section 8.2 and shall be used exclusively to offset the
12costs of administering the program, including payments made by
13the department to the department’s designated agent.
14 Sec. 6. NEW SECTION. 321B.5 Motor vehicle insurance
15reporting — penalty.
161. a. Except as provided in paragraph “b”, each insurer
17that issues a policy to a motor vehicle owner in this state
18that includes motor vehicle liability coverage, uninsured
19motorist coverage, underinsured motorist coverage, or
20personal injury coverage shall, on or before the seventh
21and twenty-first days of each calendar month, submit to the
22department’s designated agent a record of each motor vehicle
23insurance policy that was issued by the insurer and in effect
24for a vehicle registered or garaged in this state as of the
25date of the previous submission.
26b. An insurer is not required to provide a record of a motor
27vehicle insurance policy under paragraph “a” if the policy
28covers a vehicle that is registered under chapter 326.
29c. This subsection does not preclude more frequent
30reporting.
312. A record provided by an insurer under subsection 1,
32paragraph “a”, shall include all of the following:
33a. The name, date of birth, and driver’s license number, if
34the insured provides a driver’s license number to the insurer,
35of each insured owner or operator, and the address of the named
-7-1insured.
2b. The make, year, and vehicle identification number of each
3insured vehicle.
4c. The policy number and effective date of each policy.
53. An insurer shall provide the information required under
6this section via electronic means or via another means the
7designated agent agrees to accept.
84. a. The department may assess a civil penalty of not more
9than two hundred fifty dollars for each day an insurer fails to
10comply with this section.
11b. If an insurer shows that the failure to comply with this
12section was inadvertent, accidental, or the result of excusable
13neglect, the department may waive the civil penalty.
14c. An insurer that discloses records to the department’s
15designated agent in a reasonable, good-faith effort to comply
16with the requirements of this section shall not be subject to a
17civil penalty under paragraph “a”.
18 Sec. 7. NEW SECTION. 321B.6 Disclosure of database
19information — penalty.
201. Information provided to the designated agent and
21information contained in the database under this chapter are
22confidential and subject to the provisions and penalties of 18
23U.S.C. §2721. Such information may not be disclosed, except
24as follows:
25a. For the purpose of investigating, litigating, or
26enforcing the financial liability coverage requirements
27of section 321.20B, the designated agent shall provide an
28electronic record to a state or local government agency or
29court verifying motor vehicle financial liability coverage
30information.
31b. For the purpose of investigating, litigating, or
32enforcing the financial liability coverage requirements of
33section 321.20B, the designated agent shall, upon request,
34issue to any state or local government agency or court a
35certificate documenting motor vehicle financial liability
-8-1coverage, according to the database, of a specific individual
2or motor vehicle for the time period designated by the
3government agency or court.
4c. Upon request, the department or its designated agent
5shall disclose whether an individual is covered under a motor
6vehicle insurance policy, proof of the insurance coverage
7policy, and the insurance company name to:
8(1) The individual or, if the individual is deceased,
9any person who is an interested party in the estate of the
10individual as provided under chapter 633.
11(2) The parent or legal guardian of the individual if the
12individual is an unemancipated minor.
13(3) The legal guardian of the individual if the individual
14is 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
17individual dated no more than ninety days before the date the
18request is made.
19(6) A person suffering loss or injury in a motor vehicle
20accident in which the individual was involved, but only as part
21of an accident report as authorized in section 321.271 relating
22to access to accident reports.
23d. For the purpose of investigating, enforcing, or
24prosecuting laws or issuing citations, information related to a
25motor vehicle owner or operator’s financial liability coverage
26under section 321.20B may be provided to state or local law
27enforcement agencies.
28e. Upon request of a peace officer acting in an official
29capacity under the provisions of paragraph “d”, the department
30or the designated agent shall, upon request, disclose relevant
31information contained in the database.
32f. For the purpose of the state auditor conducting audits
33of the program.
34g. Upon request of a financial institution for the purpose
35of protecting the financial institution’s bona fide security
-9-1interest in a motor vehicle.
22. a. The department may allow the designated agent to
3prepare and deliver, upon request, a report on the insurance
4information of a person or motor vehicle in accordance with
5this section. The report may be in the form of:
6(1) A certified copy that is considered admissible in any
7court proceeding in the same manner as the original.
8(2) Information accessible through the internet or through
9another electronic medium if the department determines that
10sufficient security is provided to ensure compliance with this
11section.
12b. The department may allow the designated agent to charge a
13fee established by the department for each of the following:
14(1) Authenticating a document, including preparation and
15delivery of a certified copy.
16(2) Accessing a record through the internet or through
17another electronic medium.
18(3) Providing a record to a financial institution under
19subsection 1, paragraph “g”.
203. The designated agent or any other person who knowingly
21releases or discloses information from the database for a
22purpose other than those authorized in this section or to a
23person who is not entitled to such information is guilty of a
24class “D” felony.
254. Neither the state nor the department’s designated agent
26shall be liable to any person for gathering, managing, or
27using the information in the database in compliance with this
28chapter.
295. The designated agent shall be responsible for
30maintaining and securing the information in the database
31provided by the department and insurers under sections 321B.3
32and 321B.5.
336. An insurer acting in compliance with this chapter shall
34not be liable to any person for the disclosure of information
35supplied to the department or designated agent. Records
-10-1provided by an insurer under this chapter shall be deemed
2evidence of insurance and not a guarantee of insurance.
3 Sec. 8. EFFECTIVE DATE. This Act takes effect July 1, 2018.
4EXPLANATION
5The inclusion of this explanation does not constitute agreement with
6the explanation’s substance by the members of the general assembly.
7This bill establishes a motor vehicle insurance verification
8program to be administered by the department of transportation
9(DOT). The DOT is required to contract with a third party
10for four years to act as the DOT’s designated agent for
11administration of the program.
12The bill requires the DOT to establish an advisory council
13to make recommendations to the DOT on the best methods and
14practices for implementing a real-time internet services model
15for insurance verification, to assist in the development of
16a guide for insurers detailing the data fields and other
17information necessary for compliance with the bill, and to
18provide an annual report to the DOT detailing the improvements
19and implementation efforts relating to insurance verification
20in other states for consideration in improving compliance and
21operations in this state.
22The designated agent is required to establish and maintain a
23database containing information from insurers relating to motor
24vehicle insurance coverage for registered motor vehicles, motor
25vehicle identification information, personal identification
26information for registered owners of motor vehicles, and any
27other information provided to the designated agent by the DOT.
28At least twice per month, the designated agent must update the
29database and compare current motor vehicle registrations with
30updated insurance information. If records in the database
31indicate that a registered motor vehicle is not covered under
32an owner’s policy of liability insurance, the bill requires the
33designated agent to use a real-time internet services model
34to determine if the registered motor vehicle is covered under
35an owner’s policy of liability insurance. The files in the
-11-1database must be archived semiannually and audited by the DOT
2at least annually.
3If database records and the real-time internet services
4model show that a registered motor vehicle is not covered under
5an owner’s policy of liability insurance for three consecutive
6months, the designated agent is required to send a notice to
7the owner requiring the owner to respond within 15 days by
8providing proof of financial liability coverage or proof that
9the owner is exempt from the requirement to maintain financial
10liability coverage. If the owner fails to respond, a second
11notice must be sent. If the owner does not respond to the
12second notice, the owner’s motor vehicle registration must
13be revoked by the DOT and the owner is required to surrender
14the registration plates and registration receipt for the
15vehicle to the county treasurer. In order to obtain a new
16registration for the vehicle, the owner must comply with
17financial responsibility requirements and pay an administrative
18fee of $100. The fees collected are to be used by the DOT
19exclusively to offset the costs of administering the program,
20including payments made to the designated agent.
21The bill provides that if a motor vehicle is covered by a
22form of financial liability coverage other than an insurance
23policy, or if a real-time internet services model indicates a
24vehicle is appropriately insured, that fact shall be noted in
25the database.
26The bill prohibits a person from providing false or
27fraudulent information to the DOT or the DOT’s designated
28agent in relation to the motor vehicle insurance verification
29program. A violation of this provision is a simple
30misdemeanor.
31The bill requires each insurer that issues a policy to the
32owner of a motor vehicle that includes motor vehicle liability
33coverage, uninsured motorist coverage, underinsured motorist
34coverage, or personal injury coverage to, before the 7th and
35the 21st of each month, provide the DOT’s designated agent with
-12-1a record of each motor vehicle insurance policy issued by the
2insurer and in effect for vehicles registered or garaged in
3the state as of the date of the previous submission. Vehicles
4subject to apportioned registration under Code chapter 326 are
5not included in this requirement. Insurers that fail to comply
6with the reporting requirement may be assessed a civil penalty
7of $250 per day. However, the DOT may waive the penalty upon a
8showing that the failure was inadvertent, accidental, or the
9result of excusable neglect. An insurer that discloses records
10to the DOT’s designated agent in a reasonable, good-faith
11effort to comply with the bill is not subject to the penalty.
12Information contained in the database is confidential, but
13the bill provides exceptions for certain disclosures, including
14disclosures to state or local government agencies and courts
15for specified purposes, to individuals and certain other
16authorized persons, for purposes of an accident investigation,
17to law enforcement agencies and peace officers for certain
18official purposes, to the state auditor, and to financial
19institutions with a security interest in a motor vehicle.
20The designated agent may be authorized by the DOT to provide
21certified copies or electronic records, as appropriate, and to
22charge a fee for the provision of records and authentication
23of documents.
24A person, including the designated agent, who knowingly
25releases or discloses information from the database for a
26purpose other than those authorized in the bill or to a person
27who is not entitled to such information is guilty of a class
28“D” felony.
29The bill provides that the state and the DOT’s designated
30agent are not liable to any person for gathering, managing, or
31using the information in the database in compliance with the
32bill. The bill further provides that the designated agent is
33responsible for maintaining and securing the information in the
34database provided by the DOT and insurers, but insurers acting
35in compliance with the bill are not liable to any person for
-13-1the disclosure of information supplied to the DOT or designated
2agent.
3The bill takes effect July 1, 2018.
-14-ns/nh
2program, establishing fees, and including penalty and
3effective date provisions.
4BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1 Section 1. Section 321.11, subsection 3, Code 2017, is
2amended to read as follows:
33. Notwithstanding other provisions of this section to the
4contrary, the department shall not release personal information
5to a person, other than to an officer or employee of a law
6enforcement agency, an employee of a federal or state agency
7or political subdivision in the performance of the employee’s
8official duties, a contract employee of the department of
9inspections and appeals in the conduct of an investigation, or
10a licensed private investigation agency or a licensed security
11service or a licensed employee of either, if the information is
12requested by the presentation of a registration plate number.
13However, the department may release personal information to the
14department’s designated agent for the purposes of chapter 321B.
15 In addition, an officer or employee of a law enforcement agency
16may release the name, address, and telephone number of a motor
17vehicle registrant to a person requesting the information by
18the presentation of a registration plate number if the officer
19or employee of the law enforcement agency believes that the
20release of the information is necessary in the performance of
21the officer’s or employee’s duties.
22 Sec. 2. NEW SECTION. 321B.1 Short title.
23This chapter shall be known and may be cited as the “Motor
24Vehicle Insurance Verification Act”.
25 Sec. 3. NEW SECTION. 321B.2 Definitions.
26As used in this chapter, unless the context otherwise
27requires:
281. “Advisory council” means the group established pursuant
29to section 321B.3, subsection 2.
302. “Database” means the motor vehicle insurance verification
31database created under this chapter.
323. “Department” means the department of transportation.
334. “Designated agent” means the third party with which the
34department contracts under section 321B.3.
355. “Financial institution” means financial institution as
-1-1defined in 18 U.S.C.§20.
26. “Motor vehicle” means motor vehicle as defined in section
3321.1.
47. “Program” means the motor vehicle insurance verification
5program created under this chapter.
68. “Real-time internet services model” means an electronic
7service established by insurers through the internet, the
8world wide web, or a similar proprietary or common carrier
9electronic system that complies with the specifications and
10standards of the insurance industry committee on motor vehicle
11administration and that is available twenty-four hours per
12day, seven days per week, subject to reasonable allowances for
13scheduled maintenance or temporary system failures.
14 Sec. 4. NEW SECTION. 321B.3 Motor vehicle insurance
15verification program — advisory council.
161. A motor vehicle insurance verification program is
17created within the department to be administered by the
18department. The purposes of the program include all of the
19following:
20a. To establish a motor vehicle insurance verification
21database to verify compliance with the requirements of section
22321.20B.
23b. To assist in reducing the number of uninsured motor
24vehicles on the highways of the state.
25c. To assist in increasing compliance with motor vehicle
26registration requirements and for other law enforcement
27purposes.
28d. To assist in protecting the bona fide security interests
29of financial institutions in motor vehicles.
302. a. The department shall establish an advisory council,
31chaired by the director of the department or a representative
32of the department appointed by the director, consisting of
33six members including the director of the department or the
34representative of the department appointed by the director,
35a representative of the department of public safety, an
-2-1insurance company representative appointed by the commissioner
2of insurance, an insurance agent appointed by the commissioner
3of insurance, a representative of a trade association of
4property and casualty insurers appointed by the commissioner
5of insurance, and a representative of a vendor with experience
6implementing real-time internet services models and databases
7similar to the database created under this chapter appointed by
8the director of the department
9b. The advisory council shall do all of the following:
10(1) Make recommendations to the department on the best
11methods and practices for implementing a real-time internet
12services model for insurance verification.
13(2) Assist in the development of a guide for insurers
14detailing the data fields and other information necessary for
15compliance with this chapter.
16(3) Provide an annual report to the department detailing the
17improvements and implementation efforts relating to insurance
18verification in other states for consideration in improving
19compliance and operations in this state.
203. The department shall contract with a third party to act
21as the department’s designated agent for administration of this
22chapter for a period of four years. For the period of the
23contract, the designated agent shall establish and maintain a
24computer database containing the following information:
25a. Information provided by insurers under section 321B.5.
26b. Information provided by the department under subsection
276.
28c. Information obtained using a real-time internet services
29model.
30d. Any other information provided by the department pursuant
31to this chapter.
324. The database shall be developed and maintained, and
33access to a real-time internet services model shall be
34provided, in accordance with guidelines established by the
35department by rule to allow authorized state and local law
-3-1enforcement agencies and financial institutions to efficiently
2access the records of the database and real-time internet
3services model, including reports useful for the implementation
4of this chapter, twenty-four hours per day, seven days
5per week, subject to reasonable allowances for scheduled
6maintenance or temporary system failures.
7a. Database reports shall be in a form and contain
8information approved by the department.
9b. Database reports may be made available through the
10department’s internet site or through other electronic media
11if the department determines that sufficient security is
12provided to ensure compliance with the provisions of this
13chapter regarding limitations on disclosure of information in
14the database.
15c. The department shall consult with the chief information
16officer appointed under section 8B.2 for the purpose of
17developing network security requirements for the database.
185. At least twice monthly, the designated agent shall do the
19following, using information provided by the department:
20a. Update the database with motor vehicle insurance
21information provided by insurers in accordance with section
22321B.5.
23b. Compare all current motor vehicle registrations against
24the database. If records in the database indicate that a
25registered motor vehicle is not covered under an owner’s
26policy of liability insurance, the designated agent shall
27use a real-time internet services model to determine if the
28registered motor vehicle is covered under an owner’s policy of
29liability insurance.
306. On or before the seventh day of each calendar month, the
31department shall provide the designated agent with the make,
32model, year, and vehicle identification number of each vehicle
33in the department’s motor vehicle database, and the name and
34address of each person listed on each vehicle’s registration.
357. The department shall adopt rules in accordance with
-4-1chapter 17A establishing procedures for the use of the
2department’s motor vehicle database for the purposes of
3administering and enforcing this chapter.
48. a. The designated agent shall archive database files at
5least semiannually for auditing purposes.
6b. The department shall audit the program at least annually.
7The audit shall include verification of:
8(1) Billings made by the designated agent.
9(2) The accuracy of the designated agent’s matching of
10vehicle registration records with insurance data.
11 Sec. 5. NEW SECTION. 321B.4 Enforcement of financial
12responsibility requirements — penalty.
131. If records in the database and the real-time internet
14services model used by the designated agent indicate that a
15registered motor vehicle is not covered under an owner’s policy
16of liability insurance for three consecutive months, at the
17direction of the department the designated agent shall provide
18notice by first-class mail to the owner of the motor vehicle
19that the owner has fifteen days from the date the notice was
20mailed to provide one of the following:
21a. Proof of financial liability coverage as defined in
22section 321.1, subsection 24B.
23b. Proof that the owner is exempt from the requirement to
24maintain proof of financial liability coverage under section
25321.20B.
262. If, after fifteen days, the owner of the motor vehicle
27fails to provide satisfactory proof of financial liability
28coverage, the designated agent shall provide a second notice
29by first-class mail to the owner of the motor vehicle allowing
30the owner an additional fifteen days from the date the second
31notice was mailed to provide the information requested under
32subsection 1.
333. a. The designated agent shall update the database
34regarding each notice sent to a motor vehicle owner under
35subsections 1 and 2, indicating the information provided by the
-5-1motor vehicle owner or the owner’s failure to provide proof of
2financial liability coverage, as applicable.
3b. If the owner of a motor vehicle provides proof to the
4department or the designated agent that the owner’s motor
5vehicle is covered by an acceptable form of financial liability
6coverage described in section 321.1, subsection 24B, paragraph
7“b”, “c”, or “d”, the information shall be recorded in the
8database.
9c. If the designated agent determines the motor vehicle
10is appropriately insured using a real-time internet services
11model, the information shall be recorded in the database.
124. a. If the owner of a motor vehicle fails to provide
13proof of financial liability coverage following receipt of the
14second notice under subsection 2, the designated agent shall
15notify the department, and the department shall revoke the
16registration of the motor vehicle.
17b. The department shall provide to the owner of the motor
18vehicle appropriate notice of the revocation, order the owner
19to surrender the registration plates and registration receipt
20for the vehicle to the county treasurer, advise the owner of
21the legal consequences of operating a vehicle with revoked
22registration and without financial liability coverage, and
23instruct the owner on how to reinstate the vehicle registration
24once the owner has obtained financial liability coverage for
25the vehicle.
265. a. A person shall not provide a false or fraudulent
27statement to the department or the department’s designated
28agent in regard to proceedings under this chapter.
29b. In addition to any other penalties, a person who violates
30paragraph “a” is guilty of a simple misdemeanor.
316. A revocation of registration under this chapter is in
32addition to any other penalty imposed by law. This chapter
33does not affect other actions or penalties that may be taken or
34imposed for a violation of section 321.20B or other law.
357. a. A registration that has been revoked under this
-6-1section shall not be reinstated and a new registration shall
2not be issued to the holder of the revoked registration until
3the person does all of the following:
4(1) Pays to the department an administrative reinstatement
5fee of one hundred dollars, in addition to any other penalty
6imposed by law.
7(2) Complies with the requirements of section 321.20B and
8this chapter.
9b. Reinstatement fees collected under this subsection shall
10be retained by the department as repayment receipts as defined
11in section 8.2 and shall be used exclusively to offset the
12costs of administering the program, including payments made by
13the department to the department’s designated agent.
14 Sec. 6. NEW SECTION. 321B.5 Motor vehicle insurance
15reporting — penalty.
161. a. Except as provided in paragraph “b”, each insurer
17that issues a policy to a motor vehicle owner in this state
18that includes motor vehicle liability coverage, uninsured
19motorist coverage, underinsured motorist coverage, or
20personal injury coverage shall, on or before the seventh
21and twenty-first days of each calendar month, submit to the
22department’s designated agent a record of each motor vehicle
23insurance policy that was issued by the insurer and in effect
24for a vehicle registered or garaged in this state as of the
25date of the previous submission.
26b. An insurer is not required to provide a record of a motor
27vehicle insurance policy under paragraph “a” if the policy
28covers a vehicle that is registered under chapter 326.
29c. This subsection does not preclude more frequent
30reporting.
312. A record provided by an insurer under subsection 1,
32paragraph “a”, shall include all of the following:
33a. The name, date of birth, and driver’s license number, if
34the insured provides a driver’s license number to the insurer,
35of each insured owner or operator, and the address of the named
-7-1insured.
2b. The make, year, and vehicle identification number of each
3insured vehicle.
4c. The policy number and effective date of each policy.
53. An insurer shall provide the information required under
6this section via electronic means or via another means the
7designated agent agrees to accept.
84. a. The department may assess a civil penalty of not more
9than two hundred fifty dollars for each day an insurer fails to
10comply with this section.
11b. If an insurer shows that the failure to comply with this
12section was inadvertent, accidental, or the result of excusable
13neglect, the department may waive the civil penalty.
14c. An insurer that discloses records to the department’s
15designated agent in a reasonable, good-faith effort to comply
16with the requirements of this section shall not be subject to a
17civil penalty under paragraph “a”.
18 Sec. 7. NEW SECTION. 321B.6 Disclosure of database
19information — penalty.
201. Information provided to the designated agent and
21information contained in the database under this chapter are
22confidential and subject to the provisions and penalties of 18
23U.S.C. §2721. Such information may not be disclosed, except
24as follows:
25a. For the purpose of investigating, litigating, or
26enforcing the financial liability coverage requirements
27of section 321.20B, the designated agent shall provide an
28electronic record to a state or local government agency or
29court verifying motor vehicle financial liability coverage
30information.
31b. For the purpose of investigating, litigating, or
32enforcing the financial liability coverage requirements of
33section 321.20B, the designated agent shall, upon request,
34issue to any state or local government agency or court a
35certificate documenting motor vehicle financial liability
-8-1coverage, according to the database, of a specific individual
2or motor vehicle for the time period designated by the
3government agency or court.
4c. Upon request, the department or its designated agent
5shall disclose whether an individual is covered under a motor
6vehicle insurance policy, proof of the insurance coverage
7policy, and the insurance company name to:
8(1) The individual or, if the individual is deceased,
9any person who is an interested party in the estate of the
10individual as provided under chapter 633.
11(2) The parent or legal guardian of the individual if the
12individual is an unemancipated minor.
13(3) The legal guardian of the individual if the individual
14is 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
17individual dated no more than ninety days before the date the
18request is made.
19(6) A person suffering loss or injury in a motor vehicle
20accident in which the individual was involved, but only as part
21of an accident report as authorized in section 321.271 relating
22to access to accident reports.
23d. For the purpose of investigating, enforcing, or
24prosecuting laws or issuing citations, information related to a
25motor vehicle owner or operator’s financial liability coverage
26under section 321.20B may be provided to state or local law
27enforcement agencies.
28e. Upon request of a peace officer acting in an official
29capacity under the provisions of paragraph “d”, the department
30or the designated agent shall, upon request, disclose relevant
31information contained in the database.
32f. For the purpose of the state auditor conducting audits
33of the program.
34g. Upon request of a financial institution for the purpose
35of protecting the financial institution’s bona fide security
-9-1interest in a motor vehicle.
22. a. The department may allow the designated agent to
3prepare and deliver, upon request, a report on the insurance
4information of a person or motor vehicle in accordance with
5this section. The report may be in the form of:
6(1) A certified copy that is considered admissible in any
7court proceeding in the same manner as the original.
8(2) Information accessible through the internet or through
9another electronic medium if the department determines that
10sufficient security is provided to ensure compliance with this
11section.
12b. The department may allow the designated agent to charge a
13fee established by the department for each of the following:
14(1) Authenticating a document, including preparation and
15delivery of a certified copy.
16(2) Accessing a record through the internet or through
17another electronic medium.
18(3) Providing a record to a financial institution under
19subsection 1, paragraph “g”.
203. The designated agent or any other person who knowingly
21releases or discloses information from the database for a
22purpose other than those authorized in this section or to a
23person who is not entitled to such information is guilty of a
24class “D” felony.
254. Neither the state nor the department’s designated agent
26shall be liable to any person for gathering, managing, or
27using the information in the database in compliance with this
28chapter.
295. The designated agent shall be responsible for
30maintaining and securing the information in the database
31provided by the department and insurers under sections 321B.3
32and 321B.5.
336. An insurer acting in compliance with this chapter shall
34not be liable to any person for the disclosure of information
35supplied to the department or designated agent. Records
-10-1provided by an insurer under this chapter shall be deemed
2evidence of insurance and not a guarantee of insurance.
3 Sec. 8. EFFECTIVE DATE. This Act takes effect July 1, 2018.
4EXPLANATION
5The inclusion of this explanation does not constitute agreement with
6the explanation’s substance by the members of the general assembly.
7This bill establishes a motor vehicle insurance verification
8program to be administered by the department of transportation
9(DOT). The DOT is required to contract with a third party
10for four years to act as the DOT’s designated agent for
11administration of the program.
12The bill requires the DOT to establish an advisory council
13to make recommendations to the DOT on the best methods and
14practices for implementing a real-time internet services model
15for insurance verification, to assist in the development of
16a guide for insurers detailing the data fields and other
17information necessary for compliance with the bill, and to
18provide an annual report to the DOT detailing the improvements
19and implementation efforts relating to insurance verification
20in other states for consideration in improving compliance and
21operations in this state.
22The designated agent is required to establish and maintain a
23database containing information from insurers relating to motor
24vehicle insurance coverage for registered motor vehicles, motor
25vehicle identification information, personal identification
26information for registered owners of motor vehicles, and any
27other information provided to the designated agent by the DOT.
28At least twice per month, the designated agent must update the
29database and compare current motor vehicle registrations with
30updated insurance information. If records in the database
31indicate that a registered motor vehicle is not covered under
32an owner’s policy of liability insurance, the bill requires the
33designated agent to use a real-time internet services model
34to determine if the registered motor vehicle is covered under
35an owner’s policy of liability insurance. The files in the
-11-1database must be archived semiannually and audited by the DOT
2at least annually.
3If database records and the real-time internet services
4model show that a registered motor vehicle is not covered under
5an owner’s policy of liability insurance for three consecutive
6months, the designated agent is required to send a notice to
7the owner requiring the owner to respond within 15 days by
8providing proof of financial liability coverage or proof that
9the owner is exempt from the requirement to maintain financial
10liability coverage. If the owner fails to respond, a second
11notice must be sent. If the owner does not respond to the
12second notice, the owner’s motor vehicle registration must
13be revoked by the DOT and the owner is required to surrender
14the registration plates and registration receipt for the
15vehicle to the county treasurer. In order to obtain a new
16registration for the vehicle, the owner must comply with
17financial responsibility requirements and pay an administrative
18fee of $100. The fees collected are to be used by the DOT
19exclusively to offset the costs of administering the program,
20including payments made to the designated agent.
21The bill provides that if a motor vehicle is covered by a
22form of financial liability coverage other than an insurance
23policy, or if a real-time internet services model indicates a
24vehicle is appropriately insured, that fact shall be noted in
25the database.
26The bill prohibits a person from providing false or
27fraudulent information to the DOT or the DOT’s designated
28agent in relation to the motor vehicle insurance verification
29program. A violation of this provision is a simple
30misdemeanor.
31The bill requires each insurer that issues a policy to the
32owner of a motor vehicle that includes motor vehicle liability
33coverage, uninsured motorist coverage, underinsured motorist
34coverage, or personal injury coverage to, before the 7th and
35the 21st of each month, provide the DOT’s designated agent with
-12-1a record of each motor vehicle insurance policy issued by the
2insurer and in effect for vehicles registered or garaged in
3the state as of the date of the previous submission. Vehicles
4subject to apportioned registration under Code chapter 326 are
5not included in this requirement. Insurers that fail to comply
6with the reporting requirement may be assessed a civil penalty
7of $250 per day. However, the DOT may waive the penalty upon a
8showing that the failure was inadvertent, accidental, or the
9result of excusable neglect. An insurer that discloses records
10to the DOT’s designated agent in a reasonable, good-faith
11effort to comply with the bill is not subject to the penalty.
12Information contained in the database is confidential, but
13the bill provides exceptions for certain disclosures, including
14disclosures to state or local government agencies and courts
15for specified purposes, to individuals and certain other
16authorized persons, for purposes of an accident investigation,
17to law enforcement agencies and peace officers for certain
18official purposes, to the state auditor, and to financial
19institutions with a security interest in a motor vehicle.
20The designated agent may be authorized by the DOT to provide
21certified copies or electronic records, as appropriate, and to
22charge a fee for the provision of records and authentication
23of documents.
24A person, including the designated agent, who knowingly
25releases or discloses information from the database for a
26purpose other than those authorized in the bill or to a person
27who is not entitled to such information is guilty of a class
28“D” felony.
29The bill provides that the state and the DOT’s designated
30agent are not liable to any person for gathering, managing, or
31using the information in the database in compliance with the
32bill. The bill further provides that the designated agent is
33responsible for maintaining and securing the information in the
34database provided by the DOT and insurers, but insurers acting
35in compliance with the bill are not liable to any person for
-13-1the disclosure of information supplied to the DOT or designated
2agent.
3The bill takes effect July 1, 2018.
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