S 244 Session 110 (1993-1994)
S 0244 General Bill, By Martin, Cork, Gregory, Leatherman and Peeler
Similar(H 3246)
A Bill to amend Title 38, Code of Laws of South Carolina, 1976, relating to
insurance, by adding Chapter 78 so as to enact the "Consumer Freedom of Choice
in Motor Vehicle Insurance Act"; to amend the 1976 Code by adding Section
38-73-1075 so as to prohibit an insurer from increasing the premium on an
automobile liability insurance policy solely as a result of a claim for an
automobile accident filed by an insured if the insured was not at fault nor
contributorily negligent; to amend Section 38-77-30, as amended, relating to
the definition of "automobile insurance", so as to provide for the inclusion
of the personal protection policy as defined in Section 38-78-30(C); to amend
Section 38-77-110, as amended, relating to the automobile insurance law, the
requirement on insurers to insure, and exceptions, so as to expand the
exceptions with respect to added personal protection coverage as defined in
Section 38-78-30(B); to amend the 1976 Code by adding Section 38-77-355 so as
to provide that, in a claim or action for personal injury or wrongful death
arising out of the ownership, operation, use or maintenance of a motor
vehicle, the court shall admit into evidence the total amount paid to the
claimant from collateral sources and shall instruct the jury to deduct from
its verdict the value of all benefits received by the claimant from collateral
sources; to amend Section 38-77-280, as amended, relating to collision and
comprehensive insurance coverage, so as to delete the provisions of that
Section and provide that after a certain date automobile insurers may refuse
to write or renew private passenger automobile physical damage insurance
coverage, including comprehensive physical damage, collision, fire, theft, and
combined additional coverage for an applicant or existing policyholder and
that no private passenger automobile physical damage insurance coverage may be
ceded to the Reinsurance Facility; to amend Section 38-77-30, as amended,
relating to automobile insurance and the definition of "damages", so as to
provide that the term includes actual damages only; to amend Section
38-77-140, relating to automobile insurance and bodily injury and property
damage limits, so as to qualify "damages" as "actual damages" and require an
insurer to offer an insured a rider or endorsement for an additional premium
to cover liability for punitive damages; to amend Section 38-77-150, relating
to automobile insurance, the uninsured motorist provision, and defense of an
action by the insurer, so as to, among other things, delete certain language,
require insurers to offer higher limits of uninsured motorist coverage, and
provide that benefits paid pursuant to this Section are subject to subrogation
and assignment; to amend Section 38-77-160, as amended relating to additional
uninsured motorist coverage and underinsured motorist coverage, so as to,
among other things, delete certain language, provide that if an insured is
entitled to uninsured motorist or underinsured motorist coverage under more
than one policy, the maximum amount the insured may recover may not exceed the
highest limit of such coverage provided for any one vehicle under any one
policy, and provide that underinsured motorist benefits paid pursuant to this
Section are subject to subrogation and assignment; to amend Section 56-9-350,
relating to security following motor vehicle accidents, verification of
insurance coverage form to be issued following certain accidents, effect of
failure to return the form, and uninvestigated accidents, so as to delete
certain language and provide that the operator or owner of a motor vehicle
involved in an accident resulting in property damage of four hundred dollars
or more or in bodily injury or death within fifteen days after the accident
shall forward a written report of the accident on a prescribed form; to amend
Section 56-10-10, relating to vehicle financial security and other matters and
security required on registered vehicles, so as to delete certain language and
require that security be maintained on every motor vehicle required to be
registered in South Carolina where the owners or other operators not excluded
in accordance with Section 38-77-340 reside in the same household and are
insureds under the same policy, if one of the owners or other operators does
not qualify for the safe driver discount in Section 38-73-760; to amend
Section 56-10-220, relating to the requirement that a vehicle sought to b
01/20/93 Senate Introduced and read first time SJ-4
01/20/93 Senate Referred to Committee on Banking and Insurance SJ-10
A BILL
TO AMEND TITLE 38, CODE OF LAWS OF SOUTH CAROLINA,
1976, RELATING TO INSURANCE, BY ADDING CHAPTER 78
SO AS TO ENACT THE "CONSUMER FREEDOM OF
CHOICE IN MOTOR VEHICLE INSURANCE ACT"; TO
AMEND THE 1976 CODE BY ADDING SECTION 38-73-1075 SO
AS TO PROHIBIT AN INSURER FROM INCREASING THE
PREMIUM ON AN AUTOMOBILE LIABILITY INSURANCE
POLICY SOLELY AS A RESULT OF A CLAIM FOR AN
AUTOMOBILE ACCIDENT FILED BY AN INSURED IF THE
INSURED WAS NOT AT FAULT NOR CONTRIBUTORILY
NEGLIGENT; TO AMEND SECTION 38-77-30, AS AMENDED,
RELATING TO THE DEFINITION OF "AUTOMOBILE
INSURANCE", SO AS TO PROVIDE FOR THE INCLUSION
OF THE PERSONAL PROTECTION POLICY AS DEFINED IN
SECTION 38-78-30(C); TO AMEND SECTION 38-77-110, AS
AMENDED, RELATING TO THE AUTOMOBILE INSURANCE
LAW, THE REQUIREMENT ON INSURERS TO INSURE, AND
EXCEPTIONS, SO AS TO EXPAND THE EXCEPTIONS WITH
RESPECT TO ADDED PERSONAL PROTECTION COVERAGE AS
DEFINED IN SECTION 38-78-30(B); TO AMEND THE 1976 CODE
BY ADDING SECTION 38-77-355 SO AS TO PROVIDE THAT, IN
A CLAIM OR ACTION FOR PERSONAL INJURY OR
WRONGFUL DEATH ARISING OUT OF THE OWNERSHIP,
OPERATION, USE, OR MAINTENANCE OF A MOTOR
VEHICLE, THE COURT SHALL ADMIT INTO EVIDENCE THE
TOTAL AMOUNT PAID TO THE CLAIMANT FROM
COLLATERAL SOURCES AND SHALL INSTRUCT THE JURY
TO DEDUCT FROM ITS VERDICT THE VALUE OF ALL
BENEFITS RECEIVED BY THE CLAIMANT FROM
COLLATERAL SOURCES; TO AMEND SECTION 38-77-280, AS
AMENDED, RELATING TO COLLISION AND COMPREHENSIVE
INSURANCE COVERAGE, SO AS TO DELETE THE
PROVISIONS OF THAT SECTION AND PROVIDE THAT AFTER
A CERTAIN DATE AUTOMOBILE INSURERS MAY REFUSE TO
WRITE OR RENEW PRIVATE PASSENGER AUTOMOBILE
PHYSICAL DAMAGE INSURANCE COVERAGE, INCLUDING
COMPREHENSIVE PHYSICAL DAMAGE, COLLISION, FIRE,
THEFT, AND COMBINED ADDITIONAL COVERAGE FOR AN
APPLICANT OR EXISTING POLICYHOLDER AND THAT NO
PRIVATE PASSENGER AUTOMOBILE PHYSICAL DAMAGE
INSURANCE COVERAGE MAY BE CEDED TO THE
REINSURANCE FACILITY; TO AMEND SECTION 38-77-30, AS
AMENDED, RELATING TO AUTOMOBILE INSURANCE AND
THE DEFINITION OF "DAMAGES", SO AS TO
PROVIDE THAT THE TERM INCLUDES ACTUAL DAMAGES
ONLY; TO AMEND SECTION 38-77-140, RELATING TO
AUTOMOBILE INSURANCE AND BODILY INJURY AND
PROPERTY DAMAGE LIMITS, SO AS TO QUALIFY
"DAMAGES" AS "ACTUAL DAMAGES"
AND REQUIRE AN INSURER TO OFFER AN INSURED A RIDER
OR ENDORSEMENT FOR AN ADDITIONAL PREMIUM TO
COVER LIABILITY FOR PUNITIVE DAMAGES; TO AMEND
SECTION 38-77-150, RELATING TO AUTOMOBILE
INSURANCE, THE UNINSURED MOTORIST PROVISION, AND
DEFENSE OF AN ACTION BY THE INSURER, SO AS TO,
AMONG OTHER THINGS, DELETE CERTAIN LANGUAGE,
REQUIRE INSURERS TO OFFER HIGHER LIMITS OF
UNINSURED MOTORIST COVERAGE, AND PROVIDE THAT
BENEFITS PAID PURSUANT TO THIS SECTION ARE SUBJECT
TO SUBROGATION AND ASSIGNMENT; TO AMEND SECTION
38-77-160, AS AMENDED, RELATING TO ADDITIONAL
UNINSURED MOTORIST COVERAGE AND UNDERINSURED
MOTORIST COVERAGE, SO AS TO, AMONG OTHER THINGS,
DELETE CERTAIN LANGUAGE, PROVIDE THAT IF AN
INSURED IS ENTITLED TO UNINSURED MOTORIST OR
UNDERINSURED MOTORIST COVERAGE UNDER MORE THAN
ONE POLICY, THE MAXIMUM AMOUNT THE INSURED MAY
RECOVER MAY NOT EXCEED THE HIGHEST LIMIT OF SUCH
COVERAGE PROVIDED FOR ANY ONE VEHICLE UNDER ANY
ONE POLICY, AND PROVIDE THAT UNDERINSURED
MOTORIST BENEFITS PAID PURSUANT TO THIS SECTION
ARE SUBJECT TO SUBROGATION AND ASSIGNMENT; TO
AMEND SECTION 56-9-350, RELATING TO SECURITY
FOLLOWING MOTOR VEHICLE ACCIDENTS, VERIFICATION
OF INSURANCE COVERAGE FORM TO BE ISSUED
FOLLOWING CERTAIN ACCIDENTS, EFFECT OF FAILURE TO
RETURN THE FORM, AND UNINVESTIGATED ACCIDENTS, SO
AS TO DELETE CERTAIN LANGUAGE AND PROVIDE THAT
THE OPERATOR OR OWNER OF A MOTOR VEHICLE
INVOLVED IN AN ACCIDENT RESULTING IN PROPERTY
DAMAGE OF FOUR HUNDRED DOLLARS OR MORE OR IN
BODILY INJURY OR DEATH WITHIN FIFTEEN DAYS AFTER
THE ACCIDENT SHALL FORWARD A WRITTEN REPORT OF
THE ACCIDENT ON A PRESCRIBED FORM; TO AMEND
SECTION 56-10-10, RELATING TO VEHICLE FINANCIAL
SECURITY AND OTHER MATTERS AND SECURITY REQUIRED
ON REGISTERED VEHICLES, SO AS TO DELETE CERTAIN
LANGUAGE AND REQUIRE THAT SECURITY BE
MAINTAINED ON EVERY MOTOR VEHICLE REQUIRED TO BE
REGISTERED IN SOUTH CAROLINA WHERE THE OWNERS OR
OTHER OPERATORS NOT EXCLUDED IN ACCORDANCE WITH
SECTION 38-77-340 RESIDE IN THE SAME HOUSEHOLD AND
ARE INSUREDS UNDER THE SAME POLICY, IF ONE OF THE
OWNERS OR OTHER OPERATORS DOES NOT QUALIFY FOR
THE SAFE DRIVER DISCOUNT IN SECTION 38-73-760; TO
AMEND SECTION 56-10-220, RELATING TO THE
REQUIREMENT THAT A VEHICLE SOUGHT TO BE
REGISTERED BE INSURED, SO AS TO DEFINE PERSONS
APPLYING FOR REGISTRATION AS PERSONS REQUIRED TO
PROVIDE SECURITY ON A MOTOR VEHICLE AS PROVIDED
IN SECTION 56-10-10; TO AMEND SECTION 56-10-240,
RELATING TO THE REQUIREMENT THAT, UPON THE LOSS
OF INSURANCE, THE INSURED OBTAIN NEW INSURANCE OR
SURRENDER VEHICLE REGISTRATION AND PLATES,
WRITTEN NOTICE BY THE INSURER, SUSPENSION OF
REGISTRATION AND PLATES, APPEAL OF SUSPENSION,
ENFORCEMENT, AND PENALTIES, SO AS TO DELETE
CERTAIN LANGUAGE, FURTHER DESCRIBE AND QUALIFY A
MOTOR VEHICLE WHICH IS OR BECOMES AN UNINSURED
MOTOR VEHICLE, AND DEFINE THE RESIDENT FOR WHOM
THE LAPS OR TERMINATION OCCURS AFTER THREE
MONTHS AS ONE WHO DOES NOT QUALIFY FOR THE SAFE
DRIVER DISCOUNT UNDER SECTION 38-73-760; TO AMEND
CHAPTER 10 OF TITLE 56, RELATING TO MOTOR VEHICLE
REGISTRATION, AND FINANCIAL SECURITY, BY ADDING AN
ARTICLE 5 SO AS TO ENACT PROVISIONS FOR THE
REGISTRATION AND LICENSING OF UNINSURED MOTOR
VEHICLES; TO AMEND SECTION 38-77-110, AS AMENDED,
RELATING TO AUTOMOBILE INSURANCE, THE
REQUIREMENT UPON INSURERS TO INSURE, AND
EXCEPTIONS, SO AS TO PROVIDE THAT INSURERS OTHER
THAN THOSE DESIGNATED AND APPROVED AS
SPECIALIZED INSURERS BY THE CHIEF INSURANCE
COMMISSIONER MAY NOT REFUSE TO WRITE OR RENEW
AUTOMOBILE INSURANCE POLICIES FOR INDIVIDUAL
PRIVATE PASSENGER AUTOMOBILES, IF THE RISK
QUALIFIES FOR THE SAFE DRIVER DISCOUNT IN SECTION
38-73-760, OR SMALL COMMERCIAL RISKS, PROVIDE THAT
NO INSURER IS REQUIRED TO WRITE OR RENEW PRIVATE
PASSENGER AUTOMOBILE INSURANCE IF THE RISK DOES
NOT QUALIFY FOR THE SAFE DRIVER DISCOUNT, DELETE
CERTAIN LANGUAGE, PROVIDE THAT NO INSURER MAY
REFUSE TO WRITE OR RENEW A POLICY, COVERAGE, OR
ENDORSEMENT OF AUTOMOBILE INSURANCE BECAUSE OF
THE RACE, COLOR, CREED, NATIONAL ORIGIN, ANCESTRY,
OR INCOME OF ANYONE WHO SEEKS TO BECOME INSURED,
AND PROVIDE THAT AN APPLICANT DENIED COVERAGE
MUST BE PROVIDED IN WRITING BY THE DENYING
INSURER THE REASON OR REASONS FOR WHICH THE
APPLICANT HAS BEEN REFUSED INSURANCE BY THAT
INSURER, AT THE TIME OF THE DENIAL; TO AMEND
CHAPTER 77 OF TITLE 38, RELATING TO AUTOMOBILE
INSURANCE, BY ADDING AN ARTICLE 13 SO AS TO PROVIDE
FOR A JOINT UNDERWRITING ASSOCIATION AND PROVIDE,
AMONG OTHER THINGS, FOR THE ABOLITION OF THE
REINSURANCE FACILITY UPON A CERTAIN DATE, THAT THE
ADMINISTRATION OF THE PHASE OUT OF THE FACILITY IS
TRANSFERRED TO THE ASSOCIATION, AND THAT, AS OF A
CERTAIN DATE, THE FACILITY RECOUPMENT CHARGE
MUST NOT BE INCLUDED IN THE RATE OR PREMIUM
CHARGED BY THE INSURERS OF PRIVATE PASSENGER
AUTOMOBILE INSURANCE TO DRIVERS WHO QUALIFY FOR
THE SAFE DRIVER DISCOUNT; TO AMEND SECTION 38-73-455, AS AMENDED, RELATING TO AUTOMOBILE INSURANCE
RATES, SO AS TO, AMONG OTHER THINGS, DELETE
CERTAIN LANGUAGE, REQUIRE AN AUTOMOBILE INSURER
TO OFFER FOUR, RATHER THAN TWO, DIFFERENT RATES
FOR AUTOMOBILE INSURANCE, AND PROVIDE THAT, NO
LATER THAN NINETY DAYS AFTER THE PASSAGE OF THIS
ACT, INSURERS OF AUTOMOBILE INSURANCE MUST FILE
WITH THE CHIEF INSURANCE COMMISSIONER RATES FOR
PERSONAL PROTECTION POLICIES AS DEFINED BY SECTION
38-78-30 AND REVISED RATES FOR ALL OTHER PRIVATE
PASSENGER AUTOMOBILE INSURANCE POLICIES WRITTEN
BY THEM; TO AMEND SECTION 38-73-760, AS AMENDED,
RELATING TO THE STATE RATING AND STATISTICAL
DIVISION AND UNIFORM STATISTICAL PLANS, SO AS TO
PROVIDE THAT NO SURCHARGE MAY BE ASSESSED FOR
THE FIRST CONVICTION OF SPEEDING LESS THAN TWENTY
MILES PER HOUR IF THE PERSON CONVICTED HAS
MAINTAINED THE SAFE DRIVER DISCOUNT FOR THE
PREVIOUS THREE YEARS, AND PROVIDE THAT NO
SURCHARGE MAY BE ASSESSED FOR CERTAIN
CONVICTIONS OCCURRING ON OR AFTER JANUARY 1, 1995;
TO AMEND SECTION 56-10-270, RELATING TO THE
OPERATION OF AN UNINSURED VEHICLE AND PENALTIES,
SO AS TO, AMONG OTHER THINGS, INCREASE THE
PENALTIES, INCLUDING PROVISIONS FOR THE
PERFORMANCE OF PUBLIC SERVICE HOURS; TO AMEND
THE 1976 CODE BY ADDING SECTION 38-77-116 SO AS TO
PROVIDE THAT, UPON ISSUANCE OF A NEW PRIVATE
PASSENGER AUTOMOBILE INSURANCE POLICY, THE
INSURANCE COMPANY OR AGENT MUST REVIEW WITH THE
NEW APPLICANT A LIST OF DRIVING OFFENSES AND THE
RELATED FINE AND PUNISHMENT, AMONG OTHER THINGS;
TO PROVIDE THAT, AFTER SEPTEMBER 30, 1994, THE
GOVERNING BOARD OF THE JOINT UNDERWRITING
ASSOCIATION SHALL CONTRACT WITH ONE OR MORE
INSURERS OR BUSINESS ENTITIES TO SERVE AS THE
DESIGNATED CARRIER AND SHALL ESTABLISH A
PROCEDURE FOR THE SELECTION OF THE DESIGNATED
CARRIER, AND PROVIDE THAT COMMISSIONS PAID TO
AGENTS FOR POLICIES CEDED TO OR PLACED IN THE
ASSOCIATION SHALL BE SET BY THE ASSOCIATION'S
BOARD OF DIRECTORS; TO AMEND THE 1976 CODE BY
ADDING SECTIONS 38-77-175 AND 56-7-12 SO AS TO
PROVIDE, AMONG OTHER THINGS, THAT WHEN THE
OPERATOR OR OWNER OF A MOTOR VEHICLE IS ISSUED A
TRAFFIC TICKET FOR A MOVING VIOLATION BY A LAW
ENFORCEMENT OFFICER, HE MUST BE FURNISHED A
WRITTEN REQUEST FORM TO COMPLETE TO VERIFY
LIABILITY INSURANCE COVERAGE AND THAT THE FORM
MUST BE AS PRESCRIBED BY REGULATION OF THE
DEPARTMENT OF HIGHWAYS AND PUBLIC
TRANSPORTATION; TO REPEAL ARTICLE 5 OF CHAPTER 77
OF TITLE 38, RELATING TO THE REINSURANCE FACILITY
AND DESIGNATED PRODUCERS, SECTION 38-73-1420,
RELATING TO THE REQUIREMENT UPON THE BOARD OF
GOVERNORS OF THE REINSURANCE FACILITY TO FILE AND
EXPENSE COMPONENT AND USE OF THE COMPONENT
AFTER APPROVAL, SECTION 38-73-1425, RELATING TO THE
FINAL RATE OR PREMIUM CHARGE FOR PRIVATE
PASSENGER AUTOMOBILE INSURANCE RISK CEDED TO THE
REINSURANCE FACILITY, SECTION 38-77-285, RELATING TO
THE REQUIREMENT THAT ALL AUTOMOBILE INSURANCE
COVERAGES WRITTEN BY AN INSURER FOR AN INSURED'S
AUTOMOBILE MUST BE WRITTEN IN THE SAME POLICY,
WITH EXCEPTIONS AND QUALIFICATIONS, SECTION 38-77-920, RELATING TO THE PROVISION THAT INSURERS AND
AGENTS MAY NOT REFUSE THE ACCEPTANCE OF
AUTOMOBILE INSURANCE, PROPERTY RIGHTS OF CERTAIN
AGENTS, AND RESTRICTION OF MAILINGS TO CERTAIN
AREAS, SECTION 38-77-940, RELATING TO AUTOMOBILE
INSURANCE, AVOIDING CERTAIN CLASSES OR TYPES OF
RISKS, EXCEPTIONS, AND CANCELING AN AGENT'S
REPRESENTATION, SECTION 38-77-950, RELATING TO
UNREASONABLE OR EXCESSIVE USE OF THE REINSURANCE
FACILITY BY AN INSURER AND NOTICE TO A
POLICYHOLDER THAT HIS POLICY IS IN THE FACILITY, AND
SECTION 38-77-960, RELATING TO AUTOMOBILE INSURANCE
AGENT'S BUSINESS; TO AMEND SECTION 38-77-111,
RELATING TO THE COVERAGES OF AN AUTOMOBILE
INSURANCE POLICY WHICH MAY BE CEDED TO THE
REINSURANCE FACILITY, SO AS TO SUBSTITUTE THE JOINT
UNDERWRITING ASSOCIATION FOR THE REINSURANCE
FACILITY AND PROVIDE THAT AN INSURER MAY NOT CEDE
COVERAGES UNDER A POLICY THAT IT IS NOT MANDATED
BY LAW TO WRITE EXCEPT FOR TORT LIABILITY AND
PERSONAL PROTECTION COVERAGES AND UNINSURED
MOTORIST COVERAGE FOR THOSE RISKS THAT DO NOT
QUALIFY FOR THE SAFE DRIVER DISCOUNT; AND TO
PROVIDE FOR A SEVERABILITY CLAUSE, INCLUDING,
AMONG OTHER THINGS, A PROVISION THAT IF SECTION 38-78-110 IS FOUND TO BE UNCONSTITUTIONAL OR INVALID,
PERSONAL PROTECTION INSURERS HAVE NO OBLIGATION
TO PAY PERSONAL PROTECTION BENEFITS WITH RESPECT
TO ACCIDENTS OCCURRING ON OR AFTER THE DATE OF
THE FINDING OF SUCH UNCONSTITUTIONALITY OR
INVALIDITY AND, IN ADDITION, ARE SUBROGATED TO ALL
OF THE RIGHTS OF PERSONAL PROTECTION INSUREDS FOR
ALL PREVIOUS SUCH BENEFITS PAID.
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Title 38 of the 1976 Code is amended by adding:
"CHAPTER 78
Consumer Freedom of Choice in
Motor Vehicle Insurance
Section 38-78-10. This chapter may be cited as the `Consumer
Freedom of Choice in Motor Vehicle Insurance Act'.
Section 38-78-20. (A) Under existing law, the ability of a person
to recover losses incurred as a result of a motor vehicle accident is
limited by factors over which the accident victim has no control. The
recovery is dependent on the conduct of the other driver, the amount
of liability insurance carried by the other driver, and the financial
resources of the other driver. Two individuals who have received
identical injuries may recover markedly different amounts. Under
existing law, many individuals receive little or no compensation for
their losses.
(B) This chapter gives motorists the right to choose the kinds of
personal protection available in case of an automobile accident and the
amount of financial protection they deem appropriate and affordable.
Instead of being forced to buy traditional fault liability insurance to
protect strangers, motorists will have the opportunity to buy a new
personal protection policy to protect themselves and their family
members regardless of fault in the event of a motor vehicle accident.
Motorists will also have the right to reject the provisions of this
chapter, and thus retain all rights to sue and be sued for both
economic and noneconomic loss based on fault, under the existing
fault liability insurance system.
(C) The interaction between traditional fault liability insurance and
the personal protection policy is as follows:
(1) Tort vs. no-fault:
Motorists who choose the traditional fault liability insurance and
who are involved in an accident with any other motorist essentially
will retain the system existing now where they have the opportunity
to claim and sue based on fault for both economic and noneconomic
damages. They will also remain subject to being sued for such
liability to others based on fault.
(2) No fault vs. Tort: Motorists who choose the
new personal protection policy system and who are involved in an
accident with a motorist who has chosen traditional fault liability
insurance will be promptly compensated for their own economic losses
regardless of fault. A personal protection insured can claim against
and sue the other at fault motorist for economic damages if the
damages exceed their personal protection limits and for noneconomic
damages if their injury exceeds the verbal threshold. A no-fault driver
will also remain subject to being sued for liability to others if the no-fault driver is at fault. This is why no-fault coverage also includes
traditional tort liability coverage in at least the minimum limits.
(3) No fault vs. no-fault:
Two motorists who each choose the personal protection policy
and who are involved in an accident with each other will be promptly
compensated under their own policies for their own economic losses
regardless of fault. In this situation, the two motorists who have
chosen the personal protection policy do not have the right to claim
and sue for noneconomic damages based on fault unless the damages
exceed a verbal threshold. If either motorist suffers a loss in excess
of his or her policy's benefit levels, that person retains the right to
claim and sue for uncompensated economic loss based on fault.
(4) Tort vs. uninsured:
If a motorist who has chosen fault liability insurance is involved
in an accident with an uninsured motorist, the policyholder can be
compensated for losses under the uninsured motorist provisions of his
or her own policy based on fault and has the right to claim against and
sue the uninsured motorist for full damages based on fault. The
uninsured motorist forfeits any right to claim for property damage up
to ten thousand dollars and for noneconomic loss against the motorist
who has chosen fault liability insurance except where the motorist
choosing fault liability insurance was driving under the influence of
alcohol or illegal drugs or committed intentional misconduct and was
at fault in the accident. An uninsured motorist may claim against the
motorist who has chosen fault liability insurance for economic losses
based on fault.
(5) No-fault vs. uninsured:
If a motorist who has chosen the personal protection policy is
involved in an accident with an uninsured motorist, the policyholder
will be promptly compensated for economic losses under his or her
personal protection policy regardless of fault and has the right to claim
against and sue the uninsured motorist for noneconomic damages
based on fault if the injury exceeds the verbal threshold. The
uninsured motorist forfeits any right to claim for the first ten thousand
dollars of property damage and for noneconomic loss against the
motorist who has chosen the personal protection policy, except where
such motorist was driving under the influence of alcohol or illegal
drugs or committed intentional misconduct and was at fault in the
accident. An uninsured motorist may claim against the motorist who
has chosen the personal protection policy for economic losses based
on fault.
(D) The initial rate to be charged by each automobile insurer for
the basic personal protection policy required by this act and for
policies with personal protection and/or uninsured motorist coverage
in excess of the basic limits shall be at least fifteen percent lower than
the approved rate for the same limits by class and territory for each
automobile insurance risk in effect on September 30, 1993. The rate
for the basic personal protection policy cannot be increased for
automobile insurance policies issued or renewed with effective dates
between January 1, 1994, through December 31, 1994.
(E) A motorist who purchases the personal protection policy will
have five thousand dollars of property damage liability insurance as
part of his mandatory coverage.
(F) To the extent the terms of Section 38-78-20 may differ from
the terms of Section 38-78-30, the terms of Section 38-78-30 govern.
Section 38-78-30. As used in this chapter, unless the context
otherwise requires:
(A) `Accidental bodily injury' means bodily injury, sickness, or
disease, or death resulting therefrom, arising out of the ownership,
operation, or use of a motor vehicle, or while occupying such vehicle,
which is accidental as to the person insured.
(B) `Added personal protection' means an optional policy, plan, or
coverage for personal protection which each insurer issuing motor
vehicle liability insurance in this State shall make available in the
limits set by Section 38-77-110(B)(5).
(C) `Basic personal protection' means a policy, plan, or coverage
for personal protection which provides benefits for net loss resulting
from accidental bodily injury resulting from a motor vehicle accident
and liability coverage in at least the amounts prescribed by Section 38-77-140. Basic personal protection benefits consist of the following,
with an aggregate limit of fifteen thousand dollars per person arising
out of one motor vehicle accident:
(1) medical expenses;
(2) loss of income from work, up to two hundred dollars per
week;
(3) replacement services loss, up to one hundred dollars per
week;
(4) death benefits of five thousand dollars if the death of the
injured person occurs within one year after the date of a motor vehicle
accident and was a direct result of the accident.
Each basic personal protection insurer is permitted to incorporate in
added personal protection benefits coverage such terms, conditions,
and exclusions as may be consistent with the premiums charged.
Motorcycles may not be covered by a personal protection policy.
(D) `Cause of action for injury' means a claim for accidental
bodily injury for economic or noneconomic loss, or both, caused by
the negligent conduct or intentional misconduct of another person, and
includes a claim by any person other than a person suffering
accidental bodily injury based on such injury, including, but not
limited to, loss of consortium, companionship, or any derivative claim.
(E) `Commissioner' means the Chief Insurance Commissioner.
(F) `Dependent' means all persons related to another person by
blood, marriage, adoption, or otherwise who reside in the same
household at the time of the accidental bodily injury and receive
financial services or support for him or her.
(G) `Economic loss' means actual pecuniary loss and actual
monetary expenses incurred by or on behalf of an injured person as
the result of an accidental bodily injury consisting only of medical
expense, work loss, replacement services loss, and death benefits.
(H) `Governmental unit' means the United States government,
the government of the State of South Carolina, and any agency,
authority, board, department, division, commission, institution, bureau,
or like governmental entity of either such government, or any local
government in this State, and such units thereof, including, but not
limited to, counties, cities, towns, and other regional governments.
(I) `Injured person' means a person who sustains accidental bodily
injury when eligible for benefits under a policy providing personal
protection. The term also includes, where appropriate, the personal
representative of an estate.
(J) `Intentional misconduct' means conduct whereby harm is
intentionally caused or attempted to be caused by one who acts or fails
to act for the purpose of causing harm or with knowledge that harm
is substantially certain to follow when such conduct caused or
substantially contributed to the harm claimed for. A person does not
intentionally cause or attempt to cause harm (1) merely because his or
her act or failure to act is done with the realization that it creates a
grave risk of causing harm or (2) if the act or omission causing bodily
harm is for the purpose of averting bodily harm to oneself or another
person.
(K) `Loss of income from work' means eighty percent loss of
gross income from the work the injured person would have continued
to perform if he or she had not been injured, reduced by any income
from substitute work actually performed by him or her or by income
he or she would have earned in available appropriate substitute work
he or she was capable of performing but unreasonably failed to
undertake. In order to be eligible for these benefits, the injured person
must have been in an occupational status, earning or producing
income, immediately prior to the accident. Loss of income from work
does not include any loss after the death of the injured person, and
payment for the period of disability shall not exceed two years from
the date of the accident.
Loss of income from work may be excluded from an insured's
policy, at the policyholder's request, with an appropriate reduction in
the premium.
(L) `Medical expenses' means usual and customary amounts
incurred by an injured person for necessary medical, surgical,
radiological, dental, chiropractic, ambulance, hospital, medical
rehabilitation and professional nursing services, eyeglasses, hearing
aids, and prosthetic devices. Medical expense may include nonmedical
remedial treatment rendered in accordance with a recognized religious
method of healing. The words `incurred by' include medical expenses
incurred on behalf of an injured person by a parent or guardian if the
injured person is a minor or incompetent, or by a surviving spouse if
the injured person is deceased. Personal protection insurers may
review medical expenses to assure that the expenses are reasonable and
necessary according to generally accepted standards of medical
practice. Under basic personal protection and added personal
protection, medical expenses are promptly payable to the injured
person for covered expenses incurred within two years after the date
of the accident. `Medical expenses' do not include:
(1) that portion of a charge for a room in a hospital, clinic, or
convalescent or nursing home, or any other institution engaged in
providing nursing care and related services, in excess of a reasonable
and customary charge for semi-private accommodations, unless
medically required; or
(2) treatments, services, products, or procedures that are
experimental in nature, or for research, or not primarily designed to
serve a medical purpose, or which are not commonly and customarily
recognized throughout the medical profession and within the United
States as appropriate treatment of the accidental bodily injury, or
which are not performed by a professional licensed by the
professional's licensing board pursuant to Title 40.
(M) `Medical rehabilitation' means rehabilitation services which
are reasonable and necessary to reduce the disability and help to
restore the pre-accident level of physical functioning of the injured
person.
(N) `Motor vehicle' is defined by Section 38-77-30(7).
(O) `Noneconomic loss' means any loss other than economic
loss and includes, but is not necessarily limited to, pain, suffering,
inconvenience, physical impairment, mental anguish, emotional pain
and suffering, hedonic damages, and loss of any of the following:
earning capacity, consortium, society, companionship, comfort,
protection, marital care, parental care, filial care, attention, advice,
counsel, training, guidance, or education. Noneconomic loss does not
include economic loss caused by pain and suffering or by physical
impairment.
(P) `Occupying' means to be in or upon a motor vehicle or
engaged in the immediate act of entering into or alighting from the
motor vehicle.
(Q) `Operation or use' means operation or use of a motor
vehicle as a motor vehicle, including, incident to its operation or use
as a vehicle, occupying it. Operation or use of a motor vehicle does
not cover conduct within the course of a business of manufacturing,
selling, or maintaining a motor vehicle, including repairing, servicing,
washing, loading, or unloading, nor does it include such conduct not
within the course of such a business, unless such conduct occurs while
occupying a motor vehicle.
(R) `Owner' means the person or persons, other than a lienholder
or secured party, who owns or has title to a motor vehicle or is
entitled to the use and possession of a motor vehicle subject to a
security interest held by another person. Owner does not include (i)
a lessee under a lease not intended as security, or (ii) the United States
of America or any agency thereof, except with respect to motor
vehicles for which it has elected to provide insurance.
(S) `Person' includes an organization, public or private.
(T) `Personal protection' means a policy, plan, or coverage which
provides basic or added personal protection benefits for loss resulting
from accidental bodily injury, regardless of fault.
(U) `Personal protection insured' means:
(1) a person identified by name as an insured in a contract
providing personal protection benefits;
(2) while residing in the same household with a named insured,
the following persons:
(a) a spouse or other relative of a named
insured; or
(b) a minor in the custody of a named insured. A person
resides in the same household if he or she usually makes his or her
home in the same family unit, even though he or she temporarily lives
elsewhere;
(3) a person with respect to accidents within this State who
sustains accidental bodily injury while occupying or when struck as a
pedestrian by a motor vehicle insured for personal protection, unless
the person has rejected the coverage under Section 38-78-120.
(V) `Personal protection insurer' means an automobile insurer
providing personal protection benefits. (W) `Replacement
services loss' means expenses reasonably incurred in obtaining
ordinary and necessary services from others, not members of the
injured person's household, in lieu of those the injured person would
have performed for the benefit of the household. Replacement
services loss does not include any loss incurred after the death of an
injured person, and the disability period shall not exceed two years
from the date of the accident.
(X) `Resident relative' means a person related to the owner of
a motor vehicle by blood, marriage, adoption, or otherwise and
residing in the same household. A person resides in the same
household if he or she usually makes his or her home in the same
family unit, even though temporarily living elsewhere.
(Y) `Serious injury' means an accidental bodily injury which
results in death, serious and permanent loss of an important bodily
function, permanent and serious bodily injury determined objectively
within reasonable medical probability, or serious and permanent
disfigurement.
(Z) `Uncompensated economic loss' means that portion of
economic loss arising out of an accidental bodily injury of an injured
person which exceeds the benefits provided by a personal protection
insurer under a policy providing such benefits (except for loss incurred
by a deductible under such a policy) and collateral sources.
(aa) `Uninsured motorist' means the owner or operator of a
motor vehicle uninsured for either basic personal protection or liability
insurance at the limits prescribed by this State's financial
responsibility laws or who otherwise fails to comply with the financial
responsibility laws of this State.
(bb) `Uninsured motor vehicle' means a motor vehicle required
to be registered as to which (i) there is no bodily injury liability
insurance and property damage liability insurance, (ii) no bond has
been given or cash or securities delivered in lieu thereof, (iii) the
owner has not qualified as a self-insurer, and (iv) there is no basic or
added personal protection insurance as defined in Section 38-78-30.
(cc) `Reasonable and necessary' means usual and customary
charges for necessary medical treatment.
(dd) `Permanent' means an injury whose effects cannot be
eliminated by further time for recovery or by further treatment and
care, including surgery.
(ee) `Prevailing party' means the insured deemed to be the
`prevailing party' for purposes of this section if the award is at least
the amount requested in writing of the insurer not less than ten days
prior to the trial. The insurer shall be deemed to be the prevailing
party if the award is no more than the amount offered by the insurer
in writing not less than ten days prior to the trial. There shall be `no
prevailing party' if the award is more than offered by the insurer, but
less than requested by the insured.
(ff) `Reasonable proof' means itemized medical bills or other
medical records necessary to determine specific patient information,
dates of treatment, a specific diagnosis, the specific services rendered
and the specific charges for each of the services rendered. If an
insurer requests information in addition to the proof submitted, they
must specifically identify the additional information needed and why
it is needed.
(gg) `Serious' means only an injury which has a substantial
bearing on the injured person's ability to resume substantially all of
his normal activities and lifestyle.
Section 38-78-40. Each motor vehicle required to be registered in
this State shall be insured for basic personal protection as defined by
Section 38-78-30(C) and security for payment of tort liabilities as
required by Section 38-77-140, unless the owner of the motor vehicle
exercises his or her right of rejection under Section 38-78-120 or
complies with Section 56-10-520 relating to the right to drive without
insurance. This insurance may be provided by a contract of insurance
or by qualifying as a self-insurer in compliance with Section 56-9-60.
An insurance policy written by a personal protection insurer under
this chapter to provide basic personal protection is deemed to include
all coverages required by this chapter, including the minimum tort
liability coverage. Coverage under basic personal protection meets the
requirements of this State's financial responsibility laws.
Section 38-78-50. Every personal protection insured must be
offered uninsured motorist coverage as required by Section 38-77-150.
Additional uninsured motorist coverage and underinsured motorist
coverage must be offered to the insured as required by Section 38-77-160. All other provisions, rights, and obligations in Sections 38-77-150 and 38-77-160 apply to the personal protection insured and the
insurer. A personal protection insured may not recover under the
uninsured motorist provision of the personal protection policy if the
personal protection insured was at fault in the accident. Noneconomic
damages may only be recovered under this provision if the threshold
as defined in Section 38-78-110 is reached.
Section 38-78-55. Regardless of the number of motor vehicles
involved, policies issued, persons covered, claims made, or premiums
paid, the liability limits for multiple coverages under one or more
automobile insurance policies must not be combined or added together
to determine the maximum limit of coverage available to an injured
person. Unless the insurance policy or contract clearly provides
otherwise, the policy or contract may provide that if two or more
policies, plans, or coverages apply equally to the same accident, the
highest limit of liability applicable is the maximum amount available
to an injured person under any one of the policies, plans, or coverages.
Section 38-78-60. (A) A personal protection insurer shall pay to
a personal protection insured benefits for accidental bodily injury
sustained within the United States, its territories, or possessions or
Canada.
(B) A personal protection policy issued in this State contains
coverage such that it satisfies the liability insurance requirements of
the financial responsibility laws of any other state or Canadian
province in which the insured motor vehicle is operated.
Section 38-78-70. (A) A personal protection insurer has no
obligation to provide benefits to or on behalf of an injured person who
at the time of the accident:
(1) was involved in a motor vehicle accident while committing
a felony or while voluntarily occupying a motor vehicle that he or she
knew to be stolen. If the person dies as a result of his or her own
intentional misconduct, his or her survivors are not entitled to personal
protection for loss arising from the decedent's injury or death;
(2) was driving under the influence of alcohol or illegal drugs;
(3) was occupying an uninsured motor vehicle owned by the
person;
(4) was guilty of intentional misconduct. If the person dies as
a result of his or her own intentional misconduct, his or her survivors
are not entitled to personal protection for loss arising from the
decedent's injury or death;
(5) has rejected the limitation on his or her right to sue under
Section 38-78-120;
(6) was an uninsured motorist;
(7) was operating or occupying a motor vehicle with three or
fewer load bearing wheels;
(8) was operating an insured vehicle without the express or
implied consent of the owner; or
(9) was injured while occupying a motor vehicle owned by, or
furnished or available for the regular use of, the injured person, or the
injured person's resident spouse or relative, if such motor vehicle is
not described in the policy under which a claim is made, or is not a
newly acquired or replacement motor vehicle covered under the terms
of the policy.
(B) A personal protection insurer may include in personal
protection coverage any person under subsection (A) if the insurer
states its intent to do so clearly on the policy.
Section 38-78-80. At the option of the personal protection insurer,
personal protection benefits are payable to any of the following
persons:
(1) the injured person;
(2) the parent or guardian of the injured person, if the injured
person is a minor or incompetent;
(3) a survivor, executor, or administrator of the injured person; or
(4) any other person or organization rendering the services for
which payment is due.
Section 38-78-90. (A) Subject to Section 38-78-80, a person who
is entitled to receive personal protection benefits may claim the
benefits in the following order up to the limits of personal protection
in the listed category:
(1) personal protection covering the motor vehicle involved in
the accident, if the person injured was an occupant of or was struck
by the motor vehicle. If the personal protection insurer providing such
insurance disclaims coverage, the injured person shall be entitled to
benefits under any contract of personal protection insurance under
which he is a personal protection insured and the insurer making such
payments shall be entitled to contest the disclaimer and seek full
reimbursement from the insurer disclaiming coverage;
(2) the personal protection under which the injured person is or
was an insured.
(B) If two or more insurers at the same priority level are obligated
to pay personal injury benefits, the insurer against whom the claim is
first made shall pay the claim and may thereafter, recover pro rata
contributions from any other insurer at the same priority level for the
cost of the payments and for processing the claim. Disputes among
insurers may be resolved only by inter-company arbitration or inter-company agreement. For purposes of this section, an unoccupied
parked motor vehicle is not a motor vehicle involved in an accident
unless it is parked in such a way as to cause an unreasonable risk of
injury.
Section 38-78-100. (A) A personal protection insurer is obligated
to indemnify an injured person, except that benefits payable for the
same accidental bodily injury under state-mandated disability coverage
or workers' compensation or similar occupational compensation act
shall be subtracted from the personal protection benefits payable to the
injured person.
(B) A basic personal protection insurer must offer a deductible to
the named insured of a personal protection policy in the amounts of
two hundred fifty dollars, five hundred dollars, and one thousand
dollars to apply with respect to a claim by the named insured or a
person residing in the same household with the named insured. If the
named insured accepts such offer, the rate must be reduced for such
coverage in an amount filed by the insurer and approved by the
commissioner. The named insured is not required to accept the offer
and may choose personal protection coverage without a deductible
other than for property damage caused by an uninsured motorist.
Section 38-78-110. (A) Any person who registers, operates,
maintains, or uses a motor vehicle on the public roadways of this State
and their resident relatives shall, as a condition of such registration,
operation, maintenance, or use of such motor vehicle and use of the
public roadways shall be conclusively presumed to have accepted the
limitations on his tort rights and liabilities in this chapter unless he has
filed a rejection under Section 38-78-120.
(B) Tort liability with respect to accidents occurring in this State
and arising out of the ownership, maintenance, or use of a motor
vehicle is abolished with respect to any person entitled to benefits
pursuant to Section 38-78-30(C) except to the extent such person has
sustained an injury as defined in subsection (C) of this section or
except to the extent such person has sustained actual economic loss in
excess of the limits of any applicable personal protection policy.
Provided, no person may recover noneconomic loss for personal injury
except as provided in subsection (C).
(C) In any action of tort brought against the owner, registrant,
operator, or occupant of a motor vehicle with respect to which security
has been provided as required in this chapter, or against any person or
organization legally responsible for his acts or omissions, a plaintiff
may recover damages in tort for pain, suffering, mental anguish, and
inconvenience because of bodily injury, sickness, or disease arising out
of the ownership, maintenance, operation, or use of such motor vehicle
only in the event that the injury reaches one of the following
thresholds:
(1) the injury or disease consists in whole or in part of
permanent and serious disfigurement;
(2) permanent and serious bodily injury, determined objectively,
within reasonable medical probability;
(3) permanent and serious loss of an important bodily function;
or
(4) death.
(D) In any action where the defendant contends that the plaintiff's
injury does not meet the standards set forth in section (C), either party
may seek summary judgment on that issue. If a motion is made, the
court may determine at least thirty days before the date set for trial
whether there is a material issue of fact as to whether the injury meets
the standards of section (C) or if not, render summary judgment in
accordance with the undisputed facts. If the facts regarding the nature
of the injury are undisputed, the question as to whether or not the
facts render the injury as meeting the standards of section (C) is a
question of law to be decided by the court. In any action to be tried
before a jury where the defendant contends the plaintiff's injury is not
a serious and permanent injury but the defendant concedes or the court
determines that there is a material issue of fact as to whether the
plaintiff's injury meets the standards of section (C) then, upon motion
of the defendant, that issue shall be separately tried and no other
evidence as to plaintiff's noneconomic loss shall be received until that
issue has been resolved. After resolution of that issue, the amount of
the plaintiff's noneconomic loss may be tried before the same jury or
a different jury, as the court may in its discretion decide.
Section 38-78-120. (A) Any person may refuse to consent to the
limitations on his tort rights and liabilities. To ensure preservation of
the right to choose to reject any limitations on tort rights and liability
contained in this chapter, any person may execute a form approved by
the commissioner for rejecting such limitations. Within sixty days
after the enactment of this chapter, a temporary committee composed
of the commissioner, the Consumer Advocate, two representatives of
the South Carolina Bar, (one specializing in the defense of claims and
one specializing in the prosecution of claims) appointed by the
Governor, a representative of an automobile insurer appointed by the
Consumer Advocate, a member of the judiciary appointed by the Chief
Justice of the Supreme Court, an insurance agent appointed by the
commissioner, and one person specializing in readability appointed by
the Governor shall formulate the rejection form to be used by all
insurers in South Carolina. The rejection forms for personal
protection insurance shall meet the readability index of no higher than
the ninth grade level on the Flesch Reading Ease Test. The committee
shall also develop a brochure at no higher than the ninth grade level
that must be enclosed with the policyholder's renewal notice the first
time the policy is renewed after the effective date of this chapter.
(B) The form shall establish the effective date of such a rejection.
Any rejection by a person who is under a legal disability shall be
made on behalf of such person by a parent, legal guardian,
conservator, or committee and shall remain in effect until revoked or
until the person is no longer under legal disability, whichever is
sooner. The failure of such guardian, parent, conservator, or
committee of a person under a legal disability to file a rejection,
within six months from the date that this chapter would otherwise
become applicable to such person, is deemed to be an affirmative
acceptance of the limitations on tort liability. Any person who at the
time of an accident does not have basic personal protection but has not
formally rejected such limitations and has in effect security equivalent
to that required by Section 38-77-140 is deemed to have fully rejected
the tort limitations for that accident only.
(C) A rejection of tort limitations must be immediately filed with
the insurance company or agent who provides the insurance policy and
is effective on the effective date of the policy. The rejection applies
to any motor vehicle accident occurring on or after that date. The
rejection remains effective until it is revoked in writing on a form
approved by the commissioner at the time of renewal or issuance of
a new policy by the purchase of a tort policy. The revocation of the
rejection is effective until it is withdrawn in a manner prescribed by
the commissioner. The rejection form must be provided by the insurer
or agent to the insured upon the written request of the insured or the
request of a person with the legal capacity to ask for the insured.
(D) The commissioner shall establish and maintain a program
designed to assure that all consumers are adequately informed about
the comparative cost of personal protection insurance and liability
insurance for those persons who choose to reject limitations on tort
rights and liabilities, as well as the benefits, rights and responsibilities
of insureds under each type of insurance.
(E) A person who has personal protection coverage or who rejects
tort limitations on a form approved by the commissioner is bound by
that choice and is precluded from claiming liability of any party based
on being inadequately informed as to the coverage or rejection. This
restriction also applies to relatives residing in the same household who
are covered by the same policy.
(F) Each motor vehicle insurer issuing motor vehicle liability
insurance in this State may require that all policies within a household
be either personal protection policies or liability policies which satisfy
the financial responsibility laws of this State. However, policies
purchased separately by members of the same household may be
different policies.
(G) To further insure preservation of the right to reject the
limitations on tort rights contained in this chapter, the commissioner
shall establish procedures whereby any person who does not own a
motor vehicle and who is not a resident relative of such an owner
may, after sustaining accidental bodily injury, execute a form
prescribed by the commissioner for rejecting such limitation within
sixty days after the date of the accident. If any personal protection
benefits are paid before the rejection is effective, the personal
protection insurer has a right of subrogation for any payments made
through a tort recovery.
Section 38-78-125. (A) A person may bring a cause of action for
injury against a person who caused him actual economic loss, for any
uncompensated economic loss.
(B) A person suffering accidental bodily injury while occupying or
when struck by a motor vehicle which is insured for personal
protection and who is not at the time of the accident covered by a
rejection of limitations on tort rights and liabilities under Section 38-78-120 and is not an uninsured motorist may receive personal
protection benefits applicable to the motor vehicle and has a right to
claim uncompensated economic loss against the personal protection
insured. A person who files a claim under this subsection has the
same rights and duties as a personal protection insured with respect to
a claim by that insured.
(C) An uninsured injured motorist may not claim in tort for
property damage except for such damage that exceeds ten thousand
dollars or for noneconomic damages, unless the motor vehicle operator
is driving under the influence of alcohol or illegal drugs or is guilty
of intentional misconduct. An uninsured motorist retains fault liability
with respect to others. A person driving under the influence of
alcohol or illegal drugs may not claim in tort for either economic or
noneconomic damages against a person who has rejected tort
limitations. A person who rejects tort limitations shall not collect
personal protection benefits unless he or she has revoked his or her
rejection under Section 38-78-120(C).
(D) A personal protection insured has a cause of action against
another personal protection insured for property damage to recover
any required deductible.
Section 38-78-140. (A) Personal protection benefits are payable
monthly as loss accrues. Loss accrues not when the injury occurs but
as work loss, replacement services loss, or medical expense is
incurred. The benefits are overdue if they are not paid within thirty
days after the personal protection insurer receives reasonable proof of
the fact and the amount of loss sustained, except that a personal
protection insurer may accumulate claims for a period not to exceed
thirty days, in which case benefits are not overdue if they are paid
within twenty days after the period of accumulation. If reasonable
proof is not supplied for the whole claim, the amount supported by
reasonable proof is overdue if it is not paid within thirty days after the
proof is received by the insurer. Any part or all of the remainder of
the claim that is later supported by reasonable proof is overdue if it is
not paid within thirty days after the proof is received by the insurer.
To determine the extent to which any benefits are overdue, a payment
is treated as made on the date a draft or other valid instrument is
mailed or, if not so posted, the date of delivery. The personal
protection insurer may pay personal protection benefits directly to a
person who supplies necessary products, services, or accommodations
to the injured person. All overdue payments shall bear an annual
eighteen percent interest rate.
(B) In addition to the interest payments, if the insured has filed suit
to recover overdue payments, the insured shall be entitled to
reasonable attorney's fees and costs incurred in such suit. The
recovery set forth here is the exclusive remedy for an insurer's failure
to pay or delay in paying personal protection benefits for conduct of
an insurer arising out of the manner in which the insurer denied or
delayed payment. An attorney shall not charge a separate fee to
collect benefits except those incurred in connection with the suit for
overdue payments. In any action by or on behalf of an insurer, a
provider or an insured, attorney's fees shall be awarded only to the
prevailing party.
(C) An insurer who rejects a claim for basic personal protection
benefits shall give to the claimant prompt written notice of the
rejection, specifying the reason.
Section 38-78-150. (A) Personal protection benefits, except
medical benefits, are exempt from garnishment, attachment, execution,
or any other process or claim to the extent that wages or earnings are
exempt under any applicable law.
(B) An agreement for assignment of any right to personal
protection benefits payable in the future, except for medical benefits,
is unenforceable except to the extent that the benefits are for the cost
of products, services, or accommodations provided or to be provided
by the assignee or that the benefits are for loss of income from work
or replacement services and are assigned to secure payment of
alimony, maintenance, or child support.
Section 38-78-160. An insurer is allowed a reasonable attorney fee
for defending a claim for benefits that is fraudulent or so excessive as
to have no reasonable foundation. The fee may be treated as an offset
against benefits due or which thereafter accrue. The insurer may
recover from the claimant any part of the fee not offset or otherwise
paid.
Section 38-78-170. An insurer under a policy of personal
protection insurance may require written notice to be given as soon as
practicable after an accident involving a secured vehicle for which it
provides coverage.
Section 38-78-190. If no personal protection benefits have been
paid other than death benefits, a person may bring an action against
the personal protection insurer not later than two years after the
accidental bodily injury occurred. If personal protection benefits have
been paid, a person may bring an action to recover further benefits not
later than two years after the last payment of benefits or four years
after the date the accidental bodily injury occurred, whichever is
earlier.
Section 38-78-200. (A) If the mental or physical condition of an
injured person is material to any claim for past or future personal
protection benefits, the injured person shall submit to reasonable
mental or physical examinations by a physician or physicians
designated by the insurer, at the insurer's expense. The examinations
shall take place at a reasonably convenient time and location. A
personal protection insurer may include provisions of this nature in a
personal protection policy.
(B) If after a request by a personal protection insurer a person
refuses to submit to reasonable mental and physical examinations by
a physician or physicians designated by the insurer or refuses to
undergo mental or rehabilitation services payable by the insurer, the
insurer, on written notice, may deny benefits applicable to the period
during which the person refuses to submit to the examination.
Section 38-78-210. (A) On request by a claimant or personal
protection insurer, an employer shall provide information on a form
approved by the commissioner, including the work records and
earnings, regarding an employee who has filed a claim for personal
protection benefits. On request of the claimant or insurer the
information must cover the period specified by the claimant or insurer
making the request and may include a reasonable period before, and
the entire period after, the injury.
(B) The claimant, upon request by the insurer, must provide to the
insurer the names and addresses of the physicians and medical
facilities rendering diagnosis or treatment in regard to the injury or to
a relevant injury and the claimant shall authorize the insurer to inspect
and copy any relevant medical records.
(C) Every physician or other health care provider, including, but
not limited to, a hospital, clinic, or other medical institution providing,
before or after an injury resulting from a motor vehicle accident upon
which a claim for personal protection benefits is based, any products,
services, or accommodations in relation to that or any other injury, or
in relation to a condition claimed to be connected with that or any
other injury, shall, if requested to do so by the personal protection
insurer against whom the claim has been made, furnish a written
report of the history, condition, treatment, and the dates and costs of
such treatment, of the injured person. Every such physician or other
health care provider, hospital, clinic, or other medical institution shall
also promptly produce and permit the inspection and copying of its
records regarding such history, condition, and treatment, and the dates
and costs of treatment. A physician providing such information to a
personal protection insurer shall be entitled to a fee of fifty cents per
page for providing copies of the medical record, provided a minimum
fee of ten dollars plus postage is authorized. Physicians may charge
other reasonable fees for the production of other reports or information
requested by the personal insurance carrier.
(D) No cause of action for violation of a physician-patient privilege
or invasion of the right of privacy is allowed against any physician or
other health care provider, hospital, clinic, or other medical institution
complying with the provisions of this section.
(E) The person requesting records and a sworn statement under this
section shall pay all reasonable costs connected therewith.
(F) A court may order or prohibit discovery of any records under
this section in case of any dispute as to the right of a claimant or
insurer to discover the information required to be disclosed by this
section.
Section 38-78-240. A physician or other health care provider,
including, but not limited to, a hospital, clinic, or other health care
institution rendering treatment to an injured person, may charge only
a reasonable amount for the products, services, and accommodations
rendered. The charge shall not exceed the amount the person or
institution customarily charges for the products, services, and
accommodations in cases not involving automobile insurance.
Section 38-78-260. The commissioner shall adopt rules which
encourage personal protection insurers to institute incentives for
personal protection insureds to install, maintain, and make use of
injury-reducing devices such as seat and harness belts, air bags, and
child restraint systems.
Section 38-78-280. (A) Each insurer authorized to transact business
or transacting business in this State shall file with the commissioner
a form approved by the commissioner which states that any contract
of motor vehicle liability insurance, wherever issued, covering the
maintenance or use of a motor vehicle while the motor vehicle is in
this State, is deemed to satisfy Section 38-78-40 once the vehicle has
been continuously present in this State for thirty days unless the
named insured has rejected the limitations on tort rights and liabilities
under Section 38-78-120.
(B) If a person is entitled to personal protection benefits or their
equivalent under the requirements of more than one state, the person
shall elect to recover under the laws of one state. The election
represents the exclusive source of recovery of all personal protection
benefits, or their equivalent, paid or payable under the financial
responsibility requirements of that or any other state.
Section 38-78-290. All insurance coverages provided under this
chapter are subject to such terms, conditions, and exclusions which
have been approved by the commissioner.
Section 38-78-325. The commissioner may promulgate regulations
for effective administration which are fair, equitable, and consistent
with the purpose of this chapter."
SECTION 2. The 1976 Code is amended by adding:
"Section 38-73-1075. No insurer shall increase the premium
on an automobile liability insurance policy solely as a result of a claim
for an automobile accident filed by an insured if the insured was not
at fault nor contributorily negligent.
An insured may notify in writing the commissioner if the insured
believes that an insurer has increased his premium in violation of this
section. The commissioner shall investigate the compalint, take
appropriate action, and send written notice of his actions to be
insured."
SECTION 3. Section 38-77-30(1) of the 1976 Code, as last
amended by Act 443 of 1992, is further amended to read:
"(1) `Automobile insurance' means automobile bodily injury
and property damage liability insurance, including medical payments
and uninsured motorist coverage, and automobile physical damage
insurance such as automobile comprehensive physical damage,
collision, fire, theft, combined additional coverage, and similar
automobile physical damage insurance and economic loss benefits as
provided by this chapter written or offered by automobile insurers.
An automobile insurance policy includes a motor vehicle liability
policy as defined in item (7) of Section 56-9-20 and any nonowner
automobile insurance policy which covers an individual private
passenger automobile not owned by the insured, a family member of
the insured, or a resident of the same household as the insured and
includes the personal protection policy as defined in Section 38-78-30(C)."
SECTION 4. Section 38-77-110(B) of the 1976 Code, as added by
Act 148 of 1989, is amended by adding the following:
"(5) two hundred fifty thousand dollars for added personal
protection coverage as defined in Section 38-78-30(B), which may, at
the request of the applicant or insured, for an additional charge,
include more than two hundred dollars per week for loss of income
and more than one hundred dollars per week for replacement services
loss."
SECTION 5. Article 3, Chapter 77, Title 38 of the 1976 Code is
amended by adding:
"Section 38-77-355. (A) In a claim or action for personal
injury or wrongful death arising out of the ownership, operation, use,
or maintenance of a motor vehicle, the court shall admit into evidence
the total amount paid to the claimant from collateral sources, and the
court shall instruct the jury to deduct from its verdict the value of all
benefits received by the claimant from collateral sources.
(B) For purposes of this section, `collateral sources' means
payments made to the claimant, or on his behalf, by or pursuant to:
(1) automobile liability, uninsured motorist, underinsured motorist,
or automobile accident insurance that provides health benefits or
income disability coverage;
(2) personal protection benefits paid or payable by law;
(3) payments made from a policy of automobile insurance by or
on behalf of a joint tortfeaser, either by way of settlement or
judgment.
(C) No claimant may make claim or demand, no court may order
payment, and no insurer may pay by way of settlement, covenant not
to sue, or trust or loan agreement for an item of damages to the extent
that the claimant has already received, or will receive, reimbursement
for that item as a result of a collateral source payment as defined in
this section."
SECTION 6. Section 38-77-280 of the 1976 Code, as last amended
by Act 113 of 1991, is further amended to read:
"Section 38-77-280. (A) Except as provided in
subsection (B), all automobile insurers, including those insurance
companies writing private passenger physical damage coverages only,
shall make collision coverage and either comprehensive or fire, theft,
and combined additional coverage available to an insured or qualified
applicant who requests the coverage.
Collision coverage must have a mandatory deductible of two
hundred fifty dollars, but an insured or qualified applicant, as his
option, may select an additional deductible in appropriate increments
up to one thousand dollars.
Comprehensive coverage or fire, theft, and combined additional
coverages must have a mandatory deductible of two hundred fifty
dollars, but an insured, at his option, may select an additional
deductible in appropriate increments up to one thousand dollars. This
deductible does not apply to auto safety glass. It is an unfair trade
practice, as described in Sections 38-57-30 and 38-57-40, for an
insurer or an agent to sell collision insurance, comprehensive
coverage, or fire, theft, and combined additional coverages unless the
insured is notified at the time of application of the savings which may
be realized if the applicant or the insured selects a higher deductible.
This notice is required only at the time of the initial sale and must be
in a form approved by the Chief Insurance Commissioner. An insurer
may offer insureds lower deductibles at the insurer's option.
(B) Notwithstanding subsection (A) and Sections 38-77-110 and
38-77-920, automobile insurers may refuse to write automobile
physical damage insurance coverage, including automobile
comprehensive physical damage, collision, fire, theft, and combined
additional coverage, for an applicant or existing policyholder, on
renewal, for a motor vehicle customarily operated by an individual,
either the named insured or any other operator not excluded in
accordance with Section 38-77-340 and who resides in the same
household, where one or more of the conditions or factors prescribed
in Section 38-73-455 exist. In addition, automobile insurers may
refuse to write physical damage insurance coverage to any applicant
or existing policyholder, on renewal, who has collected benefits
provided under any automobile insurance physical damage coverage
during the thirty-six months immediately preceding the effective date
of coverage, for two or more total fire losses or two or more total
theft losses. Automobile insurers may refuse to write for private
passenger automobiles comprehensive physical damage, collision, fire,
theft, and combined additional coverage, for an applicant or existing
policyholder, on renewal, for a motor vehicle customarily operated by
an individual, either the named insured or another operator not
excluded in accordance with Section 38-77-340 and who resides in the
same household, which does not qualify for the safe driver discount
in Section 38-73-760(e).
(C) Notwithstanding Section 38-77-110, automobile physical
damage coverage in an automobile insurance policy may be canceled
at any time during the policy period by reason of the factors or
conditions described in Section 38-73-455(A) or Section 38-77-280(B)
which existed before the commencement of the policy period and
which were not disclosed to the insurer at the commencement of the
policy period.
(D) No policy of insurance which provides automobile physical
damage coverage only may be ceded to the facility.
(E) Insurers of automobile insurance may charge a rate for
physical damage insurance coverages different than those provided for
in Section 38-73-457 if the rates are filed and approved by the Chief
Insurance Commissioner. Any applicant or existing policyholder, to
be charged this different rate, must be denied the coverage pursuant
to subsection (B) at the rate provided in Section 38-73-457.
(F) A carrier may not cede collision coverage, comprehensive
coverage, or fire, theft, and combined additional coverages with a
deductible of less than two hundred fifty dollars. An insured or
qualified applicant may select an additional deductible in appropriate
increments up to one thousand dollars. However, the mandatory
deductible does not apply to safety glass. Notwithstanding
Sections 38-77-110 and 38-77-920, after September 30, 1996,
automobile insurers may refuse to write or renew private passenger
automobile physical damage insurance coverage, including automobile
comprehensive physical damage, collision, fire, theft, and combined
additional coverage for an applicant or existing policyholder. After
September 30, 1996, no private passenger automobile physical damage
insurance coverage may be ceded to the Facility."
SECTION 7. Section 38-77-30(4) of the 1976 Code is amended to
read:
"(4) `Damages' includes both actual and
punitive damages only."
SECTION 8. Section 38-77-140 of the 1976 Code is amended to
read:
"Section 38-77-140. (A) No automobile insurance
policy may be issued or delivered in this State to the owner of a motor
vehicle or may be issued or delivered by an insurer licensed in this
State upon any motor vehicle then principally garaged or principally
used in this State, unless it contains a provision insuring the persons
defined as insured against loss from the liability imposed by law for
actual damages arising out of the ownership, maintenance, or
use of these motor vehicles within the United States or Canada,
subject to limits exclusive of interest and costs, with respect to each
motor vehicle, as follows: fifteen thousand dollars because of bodily
injury to one person in any one accident, and, subject to the limit for
one person, thirty thousand dollars because of bodily injury to two or
more persons in any one accident, and five thousand dollars because
of injury to or destruction of property of others in any one accident.
Nothing in this article prevents an insurer from issuing selling, or
delivering a policy providing liability coverage in excess of these
requirements.
(B) An insurer shall also offer the insured, in accordance with
Section 38-77-350, a rider or endorsement for an additional premium
to cover such liability for punitive damages. The insured has the
option of accepting or refusing coverage for punitive damages.
As a result of passage of this section, all insurers offering bodily
injury liability coverage shall file with the Chief Insurance
Commissioner, not later than ninety days after the effective date of
this act, revised premium rates for bodily injury liability coverage to
be effective on automobile insurance policies issued or renewed with
effective dates on or after January 1, 1995. The revised rates must be
approved by the commissioner and reflect a reduction in the currently
approved premium rate for this coverage of at least one and one-half
percent. Insurers shall file with the commissioner not later than sixty
days after the effective date of this act premium charges for the
punitive damages loss coverage. The premium rate for this coverage
shall become effective for the automobile insurance policies issued or
renewed with effective dates on or after January 1, 1995, and may not
be approved if it is more, when combined with the reduced premium
rate for the new bodily injury liability coverage with limitations on the
recovery of punitive damages, than the bodily injury liability premium
rate for that insurer on the effective date of this act; however, after
December 31, 1995, an insurer may apply to the Chief Insurance
Commissioner for a rate adjustment for such coverage, based on its
actual experience."
SECTION 9. Section 38-77-150 of the 1976 Code is amended to
read:
"Section 38-77-150. (A) No automobile insurance
policy or contract may be issued or delivered unless it contains a
provision by endorsement or otherwise, herein referred to as the
uninsured motorist provision, undertaking to pay the insured all sums
which he is legally entitled to recover as actual damages from
the owner or operator of an uninsured motor vehicle, within limits
which may be are no less than the requirements of
Section 38-77-140 and no more than the insured's bodily injury
and property damage liability limits. The uninsured motorist
provision shall also provide for no less than five thousand dollars'
coverage for injury to or destruction of the property of the insured in
any one accident but may provide an exclusion of the first two
hundred dollars of the loss or damage.
(B) Automobile insurers shall offer, at the option of the
insured and in the manner hereinafter described, higher limits of
uninsured motorist coverage in accordance with Section 38-77-350.
The offer of higher limits must be made in connection with every
initial application for an automobile insurance policy by including a
written explanation of the coverage and inquiry of the applicant, in a
form prescribed by the Chief Insurance Commissioner, as to whether
the applicant desires to purchase uninsured motorist coverage with
limits greater than the mandatory coverages described in subsection
(A). No such explanation or inquiry need be made with respect to any
renewal, replacement, reinstatement, substitute, or modification of the
policy. An insured may, at any time and subject to the limits of this
section, specifically request in writing uninsured motorist coverage
limits greater than that provided on the current or any prior
policy.
(C) Insurers shall offer on a form prescribed by the Chief
Insurance Commissioner `nonstackable' policies of uninsured motorist
coverage containing policy provisions establishing that if the insured
accepts this offer:
(1) Regardless of the number of vehicles involved, persons
covered, number of premiums paid, or vehicles or premiums shown
on the policy or policies under which the insured might otherwise be
entitled to benefits, the coverage provided as to two or more motor
vehicles under the same or different policies may not under any
circumstances be added together, combined with, or stacked to
determine the limit of insurance coverage available to an injured
person for any one accident, except as provided in item (3) of this
subsection (C).
(2) If at the time of the accident the injured person is
occupying a motor vehicle, the uninsured motorist coverage available
to him is the coverage available as to that motor vehicle.
(3) If the injured person is occupying a motor vehicle which
is not owned by him or by a family member residing with him, he is
entitled to the highest limits of uninsured motorist coverage afforded
for any one vehicle as to which he is named insured. Such coverage
is excess over the coverage on the vehicle he is occupying.
(4) The uninsured motorist coverage provided by the policy
does not apply to the named insured who is injured while occupying
any vehicle owned by the named insured for which uninsured motorist
coverage was not purchased. (5) If at the time of the
accident the injured person is not occupying a motor vehicle, he is
entitled to select any one limit of uninsured motorist coverage for any
one vehicle afforded by a policy under which he is insured as a named
insured.
(6) In connection with the offer authorized by this
subsection, insurers shall inform the named insured, applicant, or
lessee, on a form prescribed by the Chief Insurance Commissioner, of
the limitations imposed under this subsection and that such coverage
is an alternative to coverage without such limitations. If this form is
signed by a named insured, applicant, or lessee, it is conclusively
presumed that there was an informed, knowing acceptance of such
limitations, and neither the insurance company nor the insurance agent
has any liability to the insured for the insured's failure to purchase
stackable coverage. When the named insured, applicant, or lessee has
initially accepted such limitations, the acceptance applies to any policy
which renews, extends, changes, supersedes, reinstates or replaces an
existing policy unless the named insured requests deletion of the
limitations and pays the appropriate premium for the coverage. Any
insurer who provides coverage which includes the limitations provided
in this subsection shall file revised premium rates with the Department
of Insurance for such uninsured motorist coverage to take effect before
initially providing such coverage. The revised rates must reflect the
anticipated reduction in loss costs attributable to such limitations but,
in any event, must reflect a reduction in the uninsured motorist
coverage premium of at least fifteen percent for policies with such
limitations. Insurers shall file within ninety days after the effective
date of this act, revised premium rates with the Chief Insurance
Commissioner to be effective on automobile insurance policies issued
or renewed with effective dates on or after January 1, 1995.
(D) Premium rates made by insurers for uninsured motorist
coverage must be determined and regulated as premium rates for
automobile insurance generally are determined and regulated.
The Chief Insurance Commissioner may prescribe
shall approve the form to be used in providing uninsured motorist
coverage and when prescribed and promulgated no other form
may be used.
(E) No action may be brought under the uninsured
motorist provision unless copies of the pleadings in the action
establishing liability are served in the manner provided by law upon
the insurer writing the uninsured motorist provision. The insurer has
the right to appear and defend in the name of the uninsured motorist
in any action which may affect its liability and has thirty days after
service of process on it in which to appear. The evidence of service
upon the insurer may not be made a part of the record.
(F) Benefits paid pursuant to this section are subject to
subrogation and assignment."
SECTION 10. Section 38-77-160 of the 1976 Code, as last amended
by Act 148 of 1989, is further amended to read:
"Section 38-77-160. (A) Automobile insurance
carriers insurers shall offer on a form prescribed by
the Chief Insurance Commissioner, at the option of the insured
in accordance with Section 38-77-350 uninsured
underinsured motorist coverage up to the limits of the
insured's liability coverage in addition to the mandatory coverage
prescribed by Section 38-77-150. Such carriers shall also offer, at the
option of the insured, underinsured motorist coverage up to the limits
of the insured liability coverage to provide coverage in the event that
damages are sustained in excess of the liability limits carried by an at
fault insured or underinsured motorist. If, however, an insured or
named insured is protected by uninsured or underinsured motorist
coverage in excess of the basic limits, the policy shall provide that
the insured or named insured is protected only to the extent of the
coverage he has on the vehicle involved in the accident. If none of
the insured's or named insured's vehicles is involved in the accident,
coverage is available only to the extent of coverage on any one of the
vehicles with the excess or underinsured coverage. up to the
limits selected for the insured's liability coverage to provide coverage
in the event the insured becomes legally entitled to collect damages
from the owner or operator of an underinsured motor vehicle, as
defined in Section 38-77-30(14). The maximum liability of the
insurer under the underinsured motorist coverage provided is the lesser
of: (1) the difference between the limit of underinsured motorist
coverage and the amount paid or payable to the insured by or for any
person or organization who is held legally liable for the bodily injury
or property damage, or (2) the amount of damages sustained, but not
recovered. In no event may the liability of the insurer under such
coverage be more than the limits of underinsured motorist coverage
provided.
(B) An insured entitled to benefits under an uninsured
motorist provision is not entitled to benefits under an underinsured
motorist provision. An insured entitled to benefits under an
underinsured motorist provision is not entitled to benefits under an
uninsured motorist provision.
(C) Insurers shall offer on a form prescribed by the Chief
Insurance Commissioner `nonstackable' policies of underinsured
motorist coverage containing policy provisions establishing that if the
insured accepts this offer:
(1) Regardless of the number of vehicles involved, persons
covered, number of premiums paid, or vehicles or premiums shown
on the policy or policies under which the insured might otherwise be
entitled to benefits, the coverage provided as to two or more motor
vehicles under the same or different policies may not under any
circumstances be added together, combined with, or stacked to
determine the limit of insurance coverage available to an injured
person for any one accident, except as provided in item (3) of this
subsection (C).
(2) If at the time of the accident the injured person is occupying
a motor vehicle, the underinsured motorist coverage available to him
is the coverage available as to that motor vehicle.
(3) If the injured person is occupying a motor vehicle which is
not owned by him or by a family member residing with him, he is
entitled to the highest limits of underinsured motorist coverage
afforded for any one vehicle as to which he is named insured. Such
coverage is excess over the coverage on the vehicle he is occupying.
(4) The underinsured motorist coverage provided by the policy
does not apply to the named insured who is injured while occupying
any vehicle owned by the named insured for which underinsured
motorist coverage was not purchased.
(5) If at the time of the accident the injured person is not
occupying a motor vehicle, he is entitled to select any one limit of
underinsured motorist coverage for any one vehicle afforded by a
policy under which he is insured as a named insured.
(6) In connection with the offer authorized by this subsection,
insurers shall inform the named insured, applicant, or lessee, on a
form prescribed by the chief insurance commissioner, of the
limitations imposed under this subsection and that such coverage is an
alternative to coverage without such limitations. If this form is signed
by a named insured, applicant, or lessee, it is conclusively presumed
that there was an informed, knowing acceptance of such limitations,
and neither the insurance company nor the insurance agent has any
liability to the insured for the insured's failure to purchase stackable
coverage. When the named insured, applicant, or lessee has initially
accepted such limitations, the acceptance applies to any policy which
renews, extends, changes, supersedes, reinstates or replaces an existing
policy unless the named insured requests deletion of the limitations
and pays the appropriate premium for the coverage.
(D) If an insured is entitled to uninsured motorist or
underinsured motorist coverage under more than one policy the
maximum amount the insured may recover may not exceed the highest
limit of such coverage provided for any one vehicle under any one
policy. If more than one policy applies, the following is the order of
priority: (1) a policy covering a motor vehicle occupied by the
injured person at the time of the accident; (2) a policy covering a
motor vehicle not involved in the accident under which the injured
person is named insured; (3) a policy covering a motor vehicle not
involved in the accident under which the injured person is an insured
other than a named insured. Coverage available under a lower priority
policy applies only to the extent it exceeds the coverage of a higher
priority policy. The underinsured motorist coverage does not apply to
bodily injury, sickness, or death of an insured while occupying a
motor vehicle owned by, furnished, or available for the regular use of
the insured, a resident spouse, or resident relative, if such motor
vehicle is not described in the policy under which a claim is made, or
is not a newly acquired or replacement vehicle covered under the
terms of the policy.
(E) Underinsured motorist Benefits
benefits paid pursuant to this section are not subject
to subrogation and assignment.
(F) No action may be brought under the underinsured
motorist provision unless copies of the pleadings in the action
establishing liability are served in the manner provided by law upon
the insurer writing the underinsured motorist provision. The insurer
has the right to appear and defend in the name of the underinsured
motorist in any action which may affect its liability and has thirty days
after service of process on it in which to appear. The evidence of
service upon the insurer may not be made a part of the record. In the
event the automobile insurance insurer for the putative at-fault insured
chooses to settle in part the claims against its insured by payment of
its applicable liability limits on behalf of its insured, the underinsured
motorist insurer may assume control of the defense of action for its
own benefit. No underinsured motorist policy may contain a clause
requiring the insurer's consent to settlement with the at-fault party.
Insurers offering uninsured motorist coverage must file with the
commissioner no more than ninety days after the effective date of this
act revised premium rates for this coverage to be effective on all
policies of automobile insurance containing such coverage issued on
or renewed with effective dates on or after January 1, 1995. The
revised rate must be approved by the commissioner and reflect a
reduction in the currently approved premium rate for this coverage of
at least eighteen percent; provided, however, that after December 31,
1995, an insurer may apply to the Chief Insurance Commissioner for
a rate adjustment for such coverage, based on its actual experience.
In the first year following such reductions, an insurer may apply to the
Chief Insurance Commissioner for a rate adjustment, based on its
actual experience, and include consideration of the time value of
money."
SECTION 11. Section 56-9-350 of the 1976 Code is amended to
read:
"Section 56-9-350. The operator or owner of a motor
vehicle involved in an accident resulting in property damage of four
hundred dollars or more or in bodily injury or death, must be
furnished a written request form at the time of the accident, or as soon
after the accident as possible, by the investigating officer for
completion and verification of liability insurance coverage, the form
to be in a manner prescribed by the Department.
The completed and verified form must be returned by the operator
or owner to the Department within fifteen days from the date the form
was delivered by the officer. Failure to return the form, verified in
the proper manner, is prima facie evidence that the vehicle was
uninsured.
The operator or owner of a motor vehicle involved in an accident
resulting in property damage of four hundred dollars or more, or in
bodily injury or death, which was not investigated by a law
enforcement officer shall furnish to the Department a written report
and verification of liability insurance coverage, the proof to be in a
manner prescribed by the Department within fifteen days after
the accident shall forward a written report of the accident to the
department on a form prescribed by the department. The report must
contain information to enable the department to determine whether the
requirements for the deposit of security under Section 56-9-351 are
inapplicable by reason of the existence of insurance or other
exceptions specified in this title. Failure to file the report, in the
proper verified manner, is prima facie evidence that the vehicle was
not registered in compliance with this title."
SECTION 12. Section 56-10-10 of the 1976 Code is amended to
read:
"Section 56-10-10. Every owner of a motor vehicle
required to be registered in this State shall maintain the security
required by Section 56-10-20 with respect to each such motor vehicle
owned by him throughout the period the registration is in effect.
Security must be maintained on every motor vehicle required to
be registered in this State where the owners or other operators not
excluded in accordance with Section 38-77-340 reside in the same
household and are insureds under the same policy, if one of the
owners or other operators does not qualify for the safe driver discount
in Section 38-73-760(E). Such security must be maintained with
respect to each such motor vehicle owned by him throughout the
period the registration is in effect. No certificate of registration
may be issued or transferred to an owner by the executive director
unless the owner or prospective owner produces satisfactory evidence
that the security is in effect, including the name of the owner's
automobile liability insurer, the name of the agent, the identification
number of the insurance policy, and the effective dates of the policy,
except in cases where other security is approved."
SECTION 13. Section 56-10-220 of the 1976 Code is amended to
read:
"Section 56-10-220. Every person required to provide
security on a motor vehicle as provided in Section 56-10-10
applying for registration for a motor vehicle shall at the time of such
registration and licensing declare the vehicle to be an insured motor
vehicle under the penalty set forth in Section 56-10-260 and shall
execute and furnish to the department his certificate that such motor
vehicle is an insured motor vehicle and that he will maintain insurance
thereon during the registration period. The certificate must be in the
form prescribed by the department. The department may require any
registered owner or any applicant for registration and licensing of a
motor vehicle declared to be an insured motor vehicle to submit a
certificate of insurance executed by an authorized agent or
representative of an insurance company authorized to do business in
this State. Such certificate must also be in a form prescribed by the
department."
SECTION 14. Section 56-10-240 of the 1976 Code is amended to
read:
"Section 56-10-240. If, during the period for which it is
licensed, a motor vehicle for which security is required as
provided in Section 56-10-10 is or becomes an uninsured motor
vehicle, then the vehicle owner immediately shall obtain insurance on
the vehicle or within five days after the effective date of cancellation
or expiration of his liability insurance policy surrender the motor
vehicle license plates and registration certificates issued for the motor
vehicle. If five working days after the last day to pay an automobile
liability insurance premium, whether it is the premium due date or a
grace period that is granted customarily or contractually a motor
vehicle is an uninsured motor vehicle, the insurer shall give written
notice, or notice by magnetic or electronic media in a manner
considered satisfactory to the department, within ten days after the
five-day period ends, in addition to that notice previously given in
accordance with law, by delivery under United States Post Office bulk
certified mail, return receipt requested, to the department of the
cancellation or refusal to renew under the following circumstances:
(1) the lapse or termination of such insurance or security occurs
within three months of issuance provided that this subsection only
applies to new policies, and not renewal or replacement policies; or
(2) the lapse or termination occurs after three months for a
resident who fails one or more of the objective standards
prescribed in Section 38-73-455 who does not qualify for the
safe driver discount in Section 38-73-760(E). The department
may, in its discretion, authorize insurers to utilize alternative methods
of providing notice of cancellation of or refusal to renew to the
department. The department may not reissue registration certificates
and license plates for that vehicle until satisfactory evidence has been
filed by the owner or by the insurer who gave the cancellation or
refusal to renew notice to the department that the vehicle is insured.
Upon receiving information to the effect that a policy is canceled or
otherwise terminated on a motor vehicle registered in South Carolina,
the department shall suspend the license plates and registration
certificate and shall initiate action as required within fifteen days of
the notice of cancellation to pick up the license plates and registration
certificate. A person who has had his license plates and registration
certificate suspended by the department, but who at the time of
suspension possesses liability insurance coverage sufficient to meet the
financial responsibility requirements as set forth in this chapter, has
the right to appeal the suspension immediately to the Chief Insurance
Commissioner. If the commissioner determines that the person has
sufficient liability insurance coverage, he shall notify the department,
and the suspension is voided immediately. The department shall give
notice by first class mail of the cancellation or suspension of
registration privileges to the vehicle owner at his last known address.
However, when license plates are surrendered pursuant to this section,
they must be held at the department office in the county where the
person who surrenders the plates resides.
If the vehicle owner unlawfully refuses to surrender the suspended
items as required in this article, the department through its designated
agents or by request to a county or municipal law enforcement agency
may take possession of the suspended license plates and registration
certificate and may not reissue the registration until proper proof of
liability insurance coverage is provided and until the owner has paid
a reinstatement fee of two hundred dollars for the first refusal under
this section, and three hundred dollars for each subsequent refusal. A
person who voluntarily surrenders his license plates and registration
certificate before their suspension shall only be charged a
reinstatement fee of five dollars.
A person wilfully failing to return his motor vehicle license plates
and registration certificates as required in this section is guilty of a
misdemeanor and, upon conviction, must be punished as follows:
(1) for a first offense, fined not less than one hundred dollars nor
more than two hundred dollars or imprisoned for thirty days;
(2) for a second offense, fined two hundred dollars or imprisoned
for thirty days, or both;
(3) for a third and subsequent offense, imprisoned for not less than
forty-five days nor more than six months.
Only convictions which occurred within ten years including and
immediately preceding the date of the last conviction constitute prior
convictions within the meaning of this section."
SECTION 15. Chapter 10, Title 56 of the 1976 Code is amended
by adding:
"Article 5 Registration and Licensing of
Uninsured Motor Vehicles
Section 56-10-510. As used in this article:
(1) `Conviction' includes the entry of any plea of guilty or nolo
contendere and the forfeiture of any bail or collateral deposited to
secure a defendant's appearance.
(2) `Insured motor vehicle' is a motor vehicle as to which (a) there
is bodily injury liability insurance and property damage liability
insurance, both in the amounts specified in Section 38-77-140, issued
by an insurer authorized to do business in this State, (b) a bond has
been given or cash or securities delivered in lieu of the insurance, (c)
the owner has qualified as a self-insurer in accordance with the
provisions of Section 56-9-60, or (d) the owner has at least basic
personal protection insurance as defined in Section 38-78-30(C); and
(3) `Uninsured motor vehicle' is a motor vehicle required to be
registered as to which (a) there is no bodily injury liability insurance
and property damage liability insurance, (b) no bond has been given
or cash or securities delivered in lieu thereof, (c) the owner has not
qualified as a self-insurer, and (d) there is no basic or added personal
protection insurance as defined in Section 38-78-30.
(4) `Department' is the South Carolina Department of Highways
and Public Transportation.
Section 56-10-520. In addition to any other fees prescribed by law,
every person registering and licensing an uninsured motor vehicle, as
defined in Section 56-10-510, in this State shall pay, at the time of
registering and licensing an uninsured motor vehicle, the sum of two
hundred and fifty dollars. Credit for payment made on a motor
vehicle subsequently transferred during the same licensing year must
be applied to any motor vehicle thereafter registered by the uninsured
motorist during the same licensing year. Every person knowingly
operating an uninsured motor vehicle pursuant to this section shall not
be deemed in violation of Section 56-10-270.
Section 56-10-530. The department of Highways and Public
Transportation may require that a person applying for licensing and
registration of a motor vehicle shall certify under the penalties set
forth in Section 56-10-260 whether or not each motor vehicle is an
insured motor vehicle as defined in Section 56-10-510 or the
department may in its discretion require that a person (a) produce as
evidence of financial responsibility a certificate on a form prescribed
by the department of insurance or self-insurance complying with the
requirements of Section 56-9-60, (b) has given bond or delivered the
cash or securities as provided in Sections 56-9-570 and 56-9-580,
respectively, or (c) pay the fee prescribed in Section 56-10-520.
Section 56-10-560. All funds collected by the department under the
provisions of this article must be deposited to the credit of the State
Treasurer and monthly transferred to a special deposit fund to be
known as the `Uninsured Motorists Fund' to be disbursed as provided
in Section 56-10-570 to 56-10-590.
Section 56-10-570. The fund is under the supervision and control
of the Chief Insurance Commissioner and must be paid out, on
warrants of the Comptroller General issued on vouchers signed by the
commissioner or persons he designates, for the purpose of defraying
the costs of administration of this article by the department and for
reducing the operating losses of the Reinsurance Facility as provided
in Section 56-10-580. As determined by the commissioner, when the
recoupment fee is no longer necessary to pay for losses incurred by
the facility as a result of the phasing out of the facility as provided for
by Section 38-77-1310, the fund must be paid out for financing of
driver safety measurers and for enforcing the uninsured motorist laws
of the state as determined by the General Assembly. Section 56-10-580. The Chief Insurance Commissioner annually, prior to
September 30 of each year, shall make distribution from the fund as
follows:
(1) to the department, the amount certified by it as its
administrative costs and expenses for this article. These payments
may be made on a quarterly basis.
(2) to the Reinsurance Facility to reduce the operating losses of
the Facility for the twelve month period in which they are collected
and to reduce the recoupment charges prescribed in Section 38-77-1310 assessed to drivers with the safe driver discount.
(3) to finance driver safety measures and enforce the uninsured
motorist laws of the state as determined by the General Assembly,
when the recoupment fee is no longer necessary to pay for losses
incurred by the Facility, determined by the commissioner, as a result
of the phasing out of the Facility as provided for by Section 38-77-1310.
Section 56-10-590. The Chief Insurance Commissioner may
promulgate regulations necessary to implement the provisions of this
article.
Section 56-10-610. This article does not repeal any other provision
contained in this title, but is cumulative to such other
provisions."
SECTION 16. Section 38-77-110(A) of the 1976 Code, as last
amended by Act 148 of 1989, is further amended to read:
"(A) Automobile insurers other than insurers designated and
approved as specialized insurers by the commissioner may not refuse
to write or renew automobile insurance policies for individual private
passenger automobiles if the risk qualifies for the safe driver
discount in Section 38-73-760(e) or small commercial risks.
These policies may not be canceled except for reasons which had they
existed or been known when the policy was written would have
rendered the risk not an insurable risk. Every automobile insurance
risk constitutes an insurable risk unless the operator's permit of the
named insured has been revoked or suspended and is at the time of
application for insurance so revoked or suspended. However, no
insurer is required to write or renew automobile insurance on any risk
if there exists a valid and enforceable outstanding judgment secured
by an insurer, an agent, or licensed premium service company on
account of automobile insurance premiums which the applicant or
insured or any principal operator who is a member of the named
insured's household has failed or refused to pay unless the applicant
or insured pays in advance the entire premium for the full term of the
policy sought to be issued or renewed or the annual premium,
whichever is the lesser. No insurer is required to write or renew
private passenger automobile insurance if the risk does not qualify for
the safe driver discount in Section 38-73-760(e). An insurer is
not precluded from effecting cancellation of an automobile insurance
policy, either upon its own initiative or at the instance of an agent or
licensed premium service company, because of the failure of any
named insured or principal operator to pay when due any automobile
insurance premium or any installment payment. However, notice of
cancellation for nonpayment of premium notifies the person to whom
the notice is addressed that the notice is void and ineffective if
payment of the full amount of the premium or premium indebtedness,
whichever is the greater, is made to the insurer, agent, or licensed
premium service company named in the notice by the otherwise
effective date of cancellation. This notice of cancellation is not
considered ineffective for being conditional, ambiguous, or
indefinite."
SECTION 17. Section 38-77-110(C) of the 1976 Code, as added by
Act 148 of 1989, is amended to read:
"(C) With regard to any coverage not required to be
written by an insurer under the mandate to write, no No
insurer may refuse to write or renew such policy, coverage,
or endorsement of automobile insurance because of the race, color,
creed, national origin, or ancestry, or income of
anyone who seeks to become insured."
SECTION 18. Section 38-77-110 of the 1976 Code, as last amended
by Act 148 of 1989, is further amended by adding:
"(D) An applicant denied coverage must be provided in
writing by the denying insurer the reason or reasons for which the
applicant has been refused insurance by that insurer, at the time of the
denial."
SECTION 19. Chapter 77 of Title 38 of the 1976 Code is amended
by adding:
"Article 13
Joint Underwriting Association
Section 38-77-1310. (A) The Reinsurance Facility is abolished
effective October 1, 1994. There is created the South Carolina Joint
Underwriting Association. The administration of the phase out of the
Facility is transferred to the Joint Underwriting Association.
(B) As of July 1, 1997, the Facility recoupment charge must not
be included in the rate or premium charged by the insurers of private
passenger automobile insurance to drivers who qualify for the safe
driver discount. If any losses are incurred as a result of the operation
of the Facility, the losses attributable to the Facility must be
distributed among insured drivers as provided in subsection (C) until
the commissioner determines all of the losses have been accounted for,
unless provided otherwise.
(C) Consistent with subsection (B), the rate or premium charged
by insurers of private passenger automobile insurance must include a
recoupment charge, which must be added to the appropriate rate
prescribed in Section 38-73-455 to compensate for any remaining
losses incurred by the Facility as a result of its operation up to the
effective date of this article. The operating losses of the Facility for
a twelve-month period must be recouped in the subsequent twelve-month period.
(1) Prior to December first of each year, the governing board of
the Facility shall calculate the recoupment amount, by coverage, by
dividing the net Facility operating loss, adjusted to reflect prudently
incurred expenses, consistent with the provisions of Section 38-73-465, and the time value of money, by mandated coverage for the
preceding Facility accounting year, by the total number of earned car
years in South Carolina, by coverage, for the same period of time.
.368 multiplied by the recoupment is to be borne by risks having zero
surcharge points under the Uniform Merit Plan promulgated by the
commissioner. The remainder of the recoupment (.614 multiplied by
the recoupment) represents R in the formula P1X +2P2X +3P3X +
4P4X + 5P5X + 6P6X + 7P7X + 8P8X + 9P9X + 10P10X = R. In
this formula to be utilized in determining the Facility recoupment
charge:
(a) P1 is the percentage of risks which have one surcharge
point under the Uniform Merit Rating Plan;
(b) P2 is the percentage of risks which have two surcharge
points under the Uniform Merit Rating Plan;
(c) P3 is the percentage of risks which are subject to a
surcharge of three points under the Uniform Merit Rating Plan;
(d) P4 is the percentage of risks which are subject to a
surcharge of four points under the Uniform Merit Rating Plan;
(e) P5 is the percentage of risks subject to a surcharge of five
points under the Uniform Merit Rating Plan;
(f) P6 is the percentage of risks subject to a surcharge of six
points under the Uniform Merit Rating Plan;
(g) P7 is the percentage of risks subject to a surcharge of
seven points under the Uniform Merit Rating Plan;
(h) P8 is the percentage of risks subject to a surcharge of
eight points under the Uniform Merit Rating Plan;
(i) P9 is the percentage of risks subject to a surcharge of nine
points under the Uniform Merit Rating Plan;
(j) P10 or more is the percentage of risks subject to a
surcharge of ten or more points under the Uniform Merit Rating Plan;
(k) X is the dollar amount by coverage, to be charged all
risks having one surcharge point under the Uniform Merit Rating Plan
promulgated by the commissioner. This dollar amount, by coverage,
is the Facility recoupment charge to be added to the base rate or
objective standards rate prescribed in Sections 38-73-455 and 38-73-457 for all risks which have one surcharge point.
(2) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which have one
surcharge point under the Uniform Merit Rating Plan is calculated by
multiplying X by a factor of one.
(3) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which have two
surcharge points under the Uniform Merit Rating Plan is calculated by
multiplying X by a factor of two.
(4) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of three points under the Uniform Merit Rating Plan is
calculated by multiplying X by a factor of three.
(5) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of four points under the Uniform Merit Rating Plan is
calculated by multiplying X by a factor of four. (6) The Facility
recoupment charge by coverage to be added to the base rate or
objective standards rate for all risks which are subject to a surcharge
of five points under the Uniform Merit Rating Plan is calculated by
multiplying X by a factor of five.
(7) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of six points under the Uniform Merit Rating Plan is
calculated by multiplying X by a factor of six.
(8) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of seven points under the Uniform Merit Rating Plan
is calculated by multiplying X by a factor of seven.
(9) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of eight points under the Uniform Merit Rating Plan is
calculated by multiplying X by a factor of eight.
(10) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of nine points under the Uniform Merit Rating Plan is
calculated by multiplying X by a factor of nine.
(11) The Facility recoupment charge by coverage to be added to
the base rate or objective standards rate for all risks which are subject
to a surcharge of ten or more points under the Uniform Merit Rating
Plan is calculated by multiplying X by a factor of ten.
(12) In determining the number of surcharge points a risk has for
the purposes of this section, no surcharge points assigned under the
Uniform Merit Rating Plan because the principal operator of the
automobile has not been licensed in any state for at least one year
immediately preceding the writing of the risk or as a result of a failure
of any motor vehicle equipment requirement may be considered.
(13) This section applies to all private passenger automobile
insurance policies issued or renewed after June 30, 1995. However,
insurers unable to comply with the provisions of this section and
renewal provisions required by law may comply with the provisions
of this section at any time after June 30, 1995, but in no event later
than October 1, 1995.
Section 38-77-1330. As used in this article:
(1) `Association' means the South Carolina Joint Underwriting
Association established pursuant to this article.
(2) `Net direct premiums' means gross direct premiums written on
automobile liability insurance as computed by the Chief Insurance
Commissioner less return premiums or the unused or unabsorbed
portions of premium deposits.
Section 38-77-1340. (A) A joint underwriting association is
created consisting of all automobile insurers licensed to write within
this State automobile insurance policies. Every such insurer is and
must remain a member of the association as a condition of its
authority to continue to transact this kind of insurance in this State.
(B) The purpose of the association is to provide automobile
insurance on a self-supporting basis to the fullest extent possible for
private passenger, small commercial, and motorcycle risks.
Section 38-77-1350. The association has the power on behalf of
its members to make agreements among themselves with respect to the
equitable apportionment among them of insurance which may be
afforded applicants who are in good faith entitled to or have lost their
safe driver discount, but are unable to procure such insurance through
ordinary methods, and such insurers may agree among themselves on
the use of reasonable rate modifications for such insurance. Such
agreements and rate modifications shall be subject to the approval of
the department. Section 38-77-1360. (A) The department shall,
after consultation with the insurers licensed to write automobile
liability insurance in this State, adopt a reasonable plan or plans for
the equitable apportionment among such insurers of applicants for
such insurance who are in good faith entitled to or have lost their safe
driver discount, but are unable to, procure such insurance through
ordinary methods, and, when such plan has been adopted, all such
insurers shall subscribe thereto and shall participate therein. Such plan
or plans shall include rules for classification of risks and rates therefor
by driver classification and territory. Any insured placed with the
plan shall be notified of the fact that insurance coverage is being
afforded through the plan and not through the private market, and such
notification shall be given in writing within ten days of such
placement. To assure that plan rates are made adequate to pay claims
and expenses, insurers shall develop a means of obtaining loss and
expense experience at least annually, and the plan shall file such
experience, when available, with the department in sufficient detail to
make a determination of rate adequacy.
(B) The plan of operation shall provide for economic, fair, and
nondiscriminatory administration and for the prompt and efficient
provision of insurance and may contain other provisions, including,
but not limited to, preliminary assessment of all members for initial
expenses necessary to commence operations, establishment of
necessary facilities, management of the association, assessment of the
members to defray losses and expenses, commission arrangements,
reasonable and objective underwriting standards, appointment of
servicing carriers, and procedures for determining amounts of
insurance to be provided by the association.
(C) Trend factors shall not be found to be inappropriate if not in
excess of trend factors normally used in the development of residual
market rates by the appropriate licensed rating organization. Each
application for coverage in the plan shall include, in boldfaced 12-point type immediately preceding the applicant's signature, the
following statement:
`THIS INSURANCE IS BEING AFFORDED THROUGH THE
SOUTH CAROLINA JOINT UNDERWRITING ASSOCIATION
AND NOT THROUGH THE PRIVATE MARKET. PLEASE BE
ADVISED THAT COVERAGE WITH A PRIVATE INSURER MAY
BE AVAILABLE FROM ANOTHER AGENT AT A LOWER COST.
AGENT AND COMPANY LISTINGS ARE AVAILABLE IN THE
LOCAL YELLOW PAGES.'
(D) The plan of operation shall provide that any profit achieved by
the association must be added to the reserves of the association or
returned to the policyholders as a dividend but under no circumstances
whatsoever shall any profit be paid over to or received by an insurer
either in currency or any other benefit of any kind.
(E) Amendments to the plan of operation may be made by the
directors of the association with the approval of the commissioner or
must be made at the direction of the commissioner after proper notice
and public hearing.
(F) The association may not write private passenger automobile
insurance with higher limits of coverage than:
(1) two hundred fifty thousand dollars, for bodily injury liability
to one person in one accident,
(2) subject to the limit for one person, five hundred thousand
dollars because of bodily injury to two or more persons in one
accident,
(3) fifty thousand dollars because of injury to or destruction of
property of others in any one accident,
(4) five hundred thousand dollars, combined single limits for
either or both bodily injury and property damage,
(5) two hundred fifty thousand dollars of added personal
protection benefits or personal protection liability limits up to the
limits of the personal protection benefits.
(G) If a driver covered by the association maintains a driving
record without a chargeable accident or driving conviction for three
consecutive years while they are covered by the association, the
association must attempt to place the driver with an insurer in the
voluntary market. This provision does not preclude the driver from
seeking automobile insurance coverage on the voluntary market at any
other time. If a driver has not been able to purchase insurance on the
voluntary market after seven consecutive years of maintaining a
driving record with no chargeable accidents or driving convictions the
driver must be placed by the association with an automobile insurance
company doing business in the voluntary market in this State. The
company must be chosen based on its percentage of automobile
insurance business written in this State on the voluntary market. The
company may charge the driver any one of the company's four rates
according to driver classification and territory. A driver assigned
under this provision may not be refused insurance until the driver fails
to qualify for the safe driver discount.
Section 38-77-1370. The rates, rating plans, rating rules, rating
classifications, territories, and policy forms applicable to insurance
written by the association and the statistical and experience data
relating thereto are subject to this chapter and to those provisions of
Chapter 73 of Title 38 which are not inconsistent with this chapter.
Section 38-77-1380. The commissioner shall obtain complete
statistical data in respect to automobile insurance losses and reparation
costs as well as all other costs or expenses which underlie or are
related to automobile insurance. The commissioner shall promulgate
any statistical plan he considers necessary for the purpose of gathering
data referable to loss and loss adjustment expense experience and other
expense experience. When the statistical plan is promulgated, the
association shall adopt and use it.
Section 38-77-1390. In structuring rates and determining the profit
or loss of the association in respect to such insurance, consideration
must be given by the commissioner to all investment income so that
investment income is a part of the ratemaking and ratesetting process.
Section 38-77-1395. No later than sixty days after the passage of
this act, the board must file with the commissioner rates for personal
protection policies as may be defined by law and rates for private
passenger automobile insurance liability coverages, uninsured motorist
coverages, and underinsured motorist coverages. All of these rates are
subject to surcharges or discounts, if any, applicable under any
approved Merit Rating Plan, credit, or discount plan promulgated or
approved by the commissioner. The board must file:
(1) a standard rate by driver classification and territory fifteen
percent less than the rate defined in (2). This rate applies to all
private passenger automobile insurance risks which qualify for the safe
driver discount and are insured directly by or ceded to the association;
and
(2) a rate by driver classification and territory less than the rate
defined in (3) which applies to all private passenger automobile
insurance risks which have between one and three merit surcharge
points and are insured directly by or ceded to the association; and
(3) a rate by driver classification and territory less than the rate
defined in (4) which applies to all private passenger automobile
insurance risks which have between four and ten merit surcharge
points and are insured directly by or ceded to the association; and
(4) a rate by driver classification and territory which applies to all
private passenger automobile insurance risks which have more than ten
merit surcharge points and are insured directly by or ceded to the
association.
These four rates must be construed so that when the experience
generated by them is combined, the association is able to provide
private passenger automobile insurance on a self-supporting basis. Upon the approval of these rates, they must be utilized for all
private passenger automobile insurance risks either ceded to or insured
directly by the association. The association must submit policy forms,
rating plans, and rating rules applicable to insurance to be written by
the association to the commissioner for his approval.
Section 38-77-1400. The premium rate charged for coverage must
be at rates established on an actuarially sound basis, including
consideration of trends in the frequency and severity of losses and
must be calculated to be self-supporting.
Section 38-77-1410. The association may provide a rate increase
or assessment subject to the commissioner's approval.
Section 38-77-1420. Any deficit sustained by the association in
any year must be recouped, pursuant to the plan of operation and the
rating plan then in effect, by one or both of the following procedures:
(1) an assessment upon the policyholders, which may not exceed
one additional annual premium at the then current rate;
(2) a rate increase applicable prospectively.
Section 38-77-1430. After the initial year of operation, rates,
rating plans, and rating rules and any provision for recoupment
through policyholder assessment or premium rate increase must be
based upon the association's loss and expense experience and
investment income, together with any other information based upon
this experience and income as the commissioner considers appropriate.
The resultant premium rates must be on an actuarially sound basis and
must be calculated to be self-supporting.
If sufficient funds are not available for the sound financial operation
of the association, pending recoupment as provided in Section 38-77-1420, all members, on a temporary basis, shall contribute to the
financial requirements of the association in the manner provided for
in Section 38-77-1440. Any such contribution must be reimbursed to
the members following recoupment as provided in Section 38-77-1420.
Section 38-77-1440. All insurers which are members of the
association shall participate in its writings, expenses, and losses in the
proportion that the net direct premiums of each member, excluding
that portion of premiums attributable to the operation of the
association, written during the preceding calendar year bear to the
aggregate net direct premiums written in this State by all members of
the association. Each insurer's participation in the association must be
determined annually on the basis of the net direct premiums written
during the preceding calendar year, as reported in the annual
statements and other reports filed by the insurer with the
commissioner. No member may be obligated in any one year to
reimburse the association because of its proportionate share in the
deficit from operations of the association in that year in excess of one
percent of its surplus to policyholders and the aggregate amount not
so reimbursed must be reallocated among the remaining members in
accordance with the method of determining participation prescribed in
this section after excluding from the computation the total net direct
premiums of all members not sharing in the excess deficit. If the
deficit from operations allocated to all members of the association in
any calendar year exceeds one percent of their respective surplus to
policyholders, the amount of the deficit must be allocated to each
member in accordance with the method of determining participation
prescribed in this section.
Section 38-77-1450. Every member of the association is bound by
the approved plan of operation of the association and the rules of the
board of directors of the association.
Section 38-77-1460. (A) If the authority of an insurer to transact
automobile insurance in this State terminates for any reason, its
obligations as a member of the association continue until all its
obligations are fulfilled and the commissioner has so found and
certified to the board of directors.
(B) If a member insurer merges into or consolidates with another
insurer authorized to transact insurance in this State or another insurer
authorized to transact insurance in this State has reinsured the insurer's
entire automobile insurance business in this State, both the insurer and
its successor or assuming reinsurer, as the case may be, are liable for
the insurer's obligations to the association.
(C) Any unsatisfied net liability of any insolvent member of the
association must be assumed by and apportioned among the remaining
members in the same manner in which assessments or gain and loss
are apportioned and the association shall acquire and have all rights
and remedies allowed by law in behalf of the remaining members
against the estate or funds of the insolvent insurer for funds due the
association.
Section 38-77-1470. The joint underwriting association is
governed by a board of seven directors, one of whom is appointed by
the Governor to represent the general public and four of whom are
appointed by the Governor and represent automobile insurers who are
members of the association. Two directors, appointed by the
Governor, are agents authorized to represent automobile insurers
licensed to do business in this State.
The approved plan of operation of the association may make
provision for combining insurers under common ownership or
management into groups for voting, assessment, and all other purposes
and may provide that not more than one of the officers or employees
of such a group may serve as a director at any one time. The board
of directors shall elect a chairman by majority vote and he, or his
designee, must preside at all meetings of the board. Section 38-77-1480. Any applicant for insurance through the association or any
insurer adversely affected, or claiming to be adversely affected, by any
ruling, action, or decision by or on behalf of the association, may
appeal to the commissioner within thirty days after the ruling, action,
or decision.
Section 38-77-1490. The association shall file in the office of the
commissioner annually by March first a statement containing
information with respect to its transactions, condition, operations, and
affairs during the preceding year. The statement shall contain
information prescribed by the commissioner and must be in the form
he directs.
The commissioner, at any reasonable time, may require the
association to furnish additional information concerning its
transactions, condition, or any matter connected therewith considered
to be material and of assistance in evaluating the scope, operations,
and experience of the association.
Section 38-77-1500. The commissioner shall make an examination
into the financial condition and affairs of the association at least
annually and shall file a report thereon with the Commission, the
Governor, and the General Assembly. The expenses of the
examination must be paid by the association."
SECTION 20. Section 38-73-455 of the 1976 Code, as last amended
by Act 113 of 1991, is further amended to read:
"Section 38-73-455. (A) An automobile insurer
shall offer two four different rates for automobile
insurance, a base rate as defined in Section 38-73-457 and an
objective standards rate which is twenty-five percent above the base
rate. Both All of these rates are subject to all
surcharges or discounts, if any, applicable under any approved merit
rating plan, credit, or discount plan promulgated or approved
by the commissioner. (B) No later than ninety days after the
passage of this act, insurers of automobile insurance must file with the
commissioner rates for personal protection policies as defined by
Section 38-78-30 and revised rates for all other private passenger
automobile insurance policies written by them. Each insurer must
file:
(1) a `preferred' rate by driver classification and territory,
which is a rate less than the standard rate defined herein. This rate
applies to private passenger automobile insurance risks which qualify
for the safe driver discount; and
(2) a `standard' rate which must be the approved base rate as
defined in Section 38-73-457, by driver classification and territory in
effect on July 1, 1994. This rate applies to private passenger
automobile insurance risks which qualify for the safe driver discount;
and
(3) a `nonpreferred' rate by driver classification and territory,
which is a rate more than the standard rate but less than the rate by
driver classification and territory for the substandard rate and is
applicable to all private passenger automobile insurance risks; and
(4) a `substandard' rate by driver classification and territory,
which is a rate more than the nonpreferred rate but less than or equal
to the substandard rate by driver classification and territory for the
South Carolina Joint Underwriting Association, as provided for in
Article 13 of Chapter 77 of Title 38, and is applicable to all private
passenger automobile risks.
(C) The commissioner must approve the rates filed pursuant to
subsection (A). If the rates are approved, the rates shall become
effective for all policies of automobile insurance issued or renewed
with effective dates on or after January 1, 1997.
(D) Insurers may place any automobile insurance risk at any of
the four rate levels without restriction unless provided otherwise in
this chapter. An insurer or agent shall provide written notice to the
insurer of the tier at which coverage is being written for the insured
and the reasons the insured was written in that particular tier.
However, the Uniform Merit Rating Plan must continue to apply to all
risks written by them.
(E) An applicant and all operators of the insured automobile who
have qualified for the safe driver discount for the last five years and
who reside in the same household, and the automobile or the
automobile it replaced has been insured for liability or personal
protection coverage for the past twelve months must be written at the
preferred or standard rate and may not be ceded to the Joint
Underwriting Association. A driver who is claimed as a dependent for
income tax purposes is not required to meet the five year requirement
as long as the dependent qualifies for the safe driver discount.
(F) An applicant and all operators of the insured automobile who
have qualified for the safe driver discount for the last ten years and
who reside in the same household and the automobile or the
automobile it replaced has been insured for liability or personal
protection coverage for the past twelve months must be written at the
preferred rate and may not be ceded to the Joint Underwriting
Association. A driver who is claimed as a dependent for income tax
purposes is not required to meet the ten year requirement as long as
the dependent qualifies for the safe driver discount.
(G) All policies of automobile insurance issued or renewed with
effective dates on or after October 1, 1996, that are written by
automobile insurers designated pursuant to Section 38-77-590(A), for
risks written by them through producers designated pursuant to that
same section, and all policies ceded to the Joint Underwriting
Association by automobile insurers must be written at the rates
provided for in Section 38-77-1395. However, the Uniform Merit
Rating Plan must apply to all such risks.
(H) The Board of Directors of the association must file rates by
driver classification and territory for both the personal protection
policies as defined by Section 38-78-30, liability coverages, and
uninsured motorist coverage.
Applicants, or a current policyholder, seeking automobile
insurance with an insurer must be written at the base rate, unless one
of the conditions or factors in subitems (1) through (8) of item (A) is
present.
(A) The named insured or any operator who is not excluded in
accordance with Section 37-77-340 and who resides in the same
household or customarily operates an automobile insured under the
same policy, individually:
(1) has obtained a policy of automobile insurance or continuation
thereof through material misrepresentation within the preceding thirty-six months; or
(2) has had convictions for driving violations on three or more
separate occasions within the thirty-six months immediately preceding
the effective date of coverage as reflected by the motor vehicle record
of each insured driver as maintained by the Department of Highways
and Public Transportation; or
(3) has had two or more `chargeable' accidents within the thirty-six months immediately preceding the effective date of coverage. A
`chargeable' accident is defined as one resulting in bodily injury to
any person in excess of three hundred dollars per person, death, or
damage to the property of the insured or other person in excess of
seven hundred fifty dollars. Accidents occurring under the
circumstances enumerated below are not considered chargeable.
(a) The automobile was lawfully parked. An automobile
rolling from a parked position is not considered as lawfully parked but
is considered as operated by the last operator.
(b) The applicant or other operator or owner was reimbursed
by or on behalf of a person responsible for the accident or has a
judgment against this person.
(c) The automobile of an applicant or other operator was
struck in the rear by another vehicle and the applicant or other
operator has not been convicted of a moving traffic violation in
connection with the accident.
(d) The operator of the other automobile involved in the
accident was convicted of a moving traffic violation and the applicant
or other operator was not convicted of a moving traffic violation in
connection therewith.
(e) An automobile operated by the applicant or other operator
is damaged as a result of contact with a `hit and run' driver, if the
applicant or other operator so reports the accident to the proper
authority within twenty-four hours or, if the person is injured, as soon
as the person is physically able to do so.
(f) Accidents involving damage by contact with animals or
fowl.
(g) Accidents involving physical damage, limited to an caused
by flying gravel, missiles, or falling objects.
(h) Accidents occurring as a result of the operation of any
automobile in response to an emergency if the operator at the time of
the accident was responding to a call of duty as a paid or volunteer
member of any police or fire department, first aid squad, or any law
enforcement agency. This exception does not include an accident
occurring after the emergency situation ceases or after the private
passenger motor vehicle ceases to be used in response to the
emergency; or
(4) has had one `chargeable' accident and two convictions for
driving violations, all occurring on separate occasions, within the
thirty-six months immediately preceding the effective date of coverage
as reflected by the motor vehicle record of each insured driver as
maintained by the Department of Highways and Public
Transportation; or
(5) has been convicted of or forfeited bail during the thirty-six
months immediately preceding the effective date of coverage for
operating a motor vehicle while in an intoxicated condition or while
under the influence of drugs; or
(6) has been convicted or forfeited bail during the thirty-six
months immediately preceding the effective date for: (a) any
felony involving the use of a motor vehicle,
(b) criminal negligence resulting in death, homicide, or
assault arising out of the operation of a motor vehicle,
(c) leaving the scene of an accident without stopping to
report,
(d) theft or unlawful taking of a motor vehicle,
(e) operating during a period of revocation or suspension of
registration or license,
(f) Knowingly permitting an unlicensed person to drive,
(g) reckless driving,
(h) the making of material false statements in the application
for licenses or registration,
(i) impersonating an applicant for license or registration or
procuring a license or registration through impersonation, whether for
himself or another,
(j) filing of a false or fraudulent claim or knowingly aiding
or abetting another in the presentation of such a claim,
(k) failure to stop a motor vehicle when signaled by means
or a siren or flashing light by a law enforcement vehicle; or
(7) has for thirty or more consecutive days during the twelve
months immediately preceding the effective date of coverage, owned
or operated the automobile to be insured (or if newly acquired, the
automobile it replaces) without liability coverage in violation of the
laws of this State; or
(8) has used the insured automobile as follows or if the insured
automobile is:
(a) used in carrying passengers for hire or compensation,
except that the use of an automobile for a car pool must not be
considered use of an automobile for hire or compensation,
(b) used in the business of transportation of flammables or
explosives,
(c) used in illegal operation, or
(d) no longer principally used and garaged within the State,
but not to include students who are operating a motor vehicle
registered in this State while attending an institution located in another
state.
(B) In the event that one or more of the conditions or factors
prescribed in items (1) through (8) of subsection (A) exist, the motor
vehicle customarily operated by that individual must be written at the
objective standards rate.
(C) (I) Member companies of an affiliated group of
automobile insurers may not utilize different filed rates for
automobile insurance coverages which they are mandated by law
to write. For the purpose of this section, an affiliated group of
automobile insurers includes a group of automobile insurers under
common ownership, management, or control. Those automobile
insurers designated pursuant to Section 38-77-590(a), for automobile
insurance risks written by them through producers designated by the
Facility governing board pursuant to that section, shall utilize the rates
or premium charges by coverage filed and authorized for use by the
rating organization licensed by the Commissioner pursuant to Article
11, Chapter 73 of this title, which has the largest number of members
or subscribers for automobile insurance rates. However, those
automobile insurers designated pursuant to Section 38-77-590(a) are
not required to use those same rates or premium charges described in
the preceding sentence for risks written by them through their
authorized agents not appointed pursuant to Section 38-77-590.
(D) (J) An automobile insurance policy may be
endorsed at any time during the policy period to reflect the correct rate
or premium applicable by reason of the factors or conditions described
in subsection (A) which existed prior to the commencement of the
policy period in which the endorsement is made, regardless of whether
the factors or conditions were known or disclosed to the insurer at the
commencement of the policy period. However, no No
policy may be endorsed during a policy period to reflect factors or
conditions occurring during that policy period. A policy may be
endorsed during a policy period to recognize the addition or deletion
of an operator or vehicle.
(E) For purposes of determining the applicable rates to be
charged an insured, an automobile insurer shall obtain and review an
applicant's motor vehicle record."
SECTION 21. Section 38-73-760 of the 1976 Code, as last amended
by Act 148 of 1989, is further amended by adding:
"(g) No surcharge may be assessed for the first conviction
of speeding less than twenty miles per hour if the person convicted has
maintained the safe driver discount for the previous three years.
(h) No surcharge may be assessed for convictions of the following
violations occurring on or after January 1, 1995: failing to dim lights;
operating with improper lights; operating with improper brakes; or
operating a vehicle in unsafe condition."
SECTION 22. Section 56-10-270 of the 1976 Code is amended to
read:
"Section 56-10-270. (a) Any person knowingly operating an
uninsured motor vehicle subject to registration in this State or any
person knowingly allowing the operation of an uninsured motor
vehicle subject to registration in this State is guilty of a misdemeanor
and, upon conviction, must be punished as follows:
(1) for a first offense, fined not less than one
two hundred dollars nor more than two three
hundred dollars or imprisoned for thirty days or may be ordered
to perform up to fifty public service hours, or a combination of
these, and,
(2) upon conviction of a second offense, be fined
two three hundred dollars or imprisoned for thirty
days or perform up to one hundred public service hours, or a
combination of these, or both, and
(3) for a third and subsequent offenses must be
imprisoned for not less than forty-five days nor more than six months
and be fined four hundred dollars or serve up to two hundred
public service hours, or a combination of these. Only convictions
which occurred within five years including and immediately preceding
the date of the last conviction constitute prior convictions within the
meaning of this section. An uninsured motor vehicle includes an
insured vehicle with respect to which the operator has been excluded
from coverage pursuant to the provisions of Section 38-77-340.
(b) The department upon receipt of information to the effect that
any person has been convicted of violating subsection (a) of this
section shall suspend the driving privilege and all license plates and
registration certificates issued in the person's name for a period of
thirty days for a first offense, for a period of ninety days for a
second offense, and for a period of six months for a third and each
subsequent offense. and may not reinstate that
The person's privileges may not be reinstated until
proof of financial responsibility has been filed.
(c) Any person whose license plates and registration certificates
which are suspended as provided in this section, which are not
suspended for any other reason, may have them immediately restored,
if he files proof of financial responsibility with the department."
SECTION 23. The 1976 Code is amended by adding:
"Section 38-77-116. Upon issuance of a new private
passenger automobile insurance policy, the insurance company or
agent must review with the new applicant a list of driving offenses
and the related fine and punishment, as well as the possible increase
in the rates, the effect of any surcharges, or the effect of the loss of
the safe driver discount. This list must be on a form approved by the
Chief Insurance Commissioner and must accompany the policy."
SECTION 24. After September 30, 1994, the governing board of
the Joint Underwriting Association, enacted pursuant to Article 13 of
Chapter 77 of Title 38 of the 1976 Code as contained in this act, shall
contract with one or more insurers or business entities to serve as the
designated carrier and shall establish a procedure for the selection of
the designated carrier. In developing this procedure, the board must
establish criteria which will assure the designated carrier's ability to
adequately provide policy-writing and claims service. However, the
board may not require that the designated carrier be a licensed
insurance company. Designated carrier contracts must be for a period
of three years and must be awarded upon the terms and conditions for
competitive sealed bidding as provided in Section 11-35-1520 of the
1976 Code.
If the designated carrier fails two claims audits, including a re-audit,
within the contract term, the designated carrier is disqualified for
renewal of its contract with the Facility upon expiration of its existing
contract. Designated carrier contracts awarded pursuant to this section
must provide that the failure of two claims audits, including a re-audit,
during the contract term constitutes a material breach of the contract.
After July 1, 1994, the governing board of the association may not
designate any new producers.
Commissions paid to agents for policies ceded to or placed in the
Joint Underwriting Association shall be set by the association's board
of directors.
SECTION 25. The 1976 Code is amended by adding:
"Section 38-77-175. (A) When the operator or owner of a
motor vehicle is issued a traffic ticket for a moving violation by a law
enforcement officer, he must be furnished a written request form to
complete to verify liability insurance coverage. The form must be in
a manner prescribed by regulation of the Department of Highways and
Public Transportation.
(B) The completed and verified form must be returned by the
operator or owner to the department within fifteen days from the date
he receives it. Failure to return the form verified in the proper
manner is prima facie evidence that the vehicle was uninsured.
(C) Any fine collected for a violation of Section 56-10-270,
relating to driving uninsured, as a result of this section must be
deposited in the treasury of the municipality or the county employing
the law enforcement officer who issued the original ticket, if such law
enforcement officer is a municipal or county employee, or in the
general fund of the State, if the law enforcement officer who issued
the original ticket is an employee of a state agency or
department."
SECTION 26. The 1976 Code is amended by adding:
"Section 56-7-12. (A) When the operator or owner of a
motor vehicle is issued a traffic ticket for a moving violation by a law
enforcement officer, he must be furnished a written request form to
complete to verify liability insurance coverage. The form must be in
a manner prescribed by regulation of the Department of Highways and
Public Transportation.
(B) The completed and verified form must be returned by the
operator or owner to the department within fifteen days from the date
he receives it. Failure to return the form verified in the proper
manner is prima facie evidence that the vehicle was uninsured.
(C) Any fine collected for a violation of Section 56-10-270,
relating to driving uninsured, as a result of this section must be
deposited in the treasury of the municipality or the county employing
the law enforcement officer who issued the original ticket, if such law
enforcement officer is a municipal or county employee, or in the
general fund of the State, if the law enforcement officer who issued
the original ticket is an employee of a state agency or
department."
SECTION 27. Article 5 of Chapter 77 of Title 38 of the 1976 Code
and Sections 38-73-1420, 38-73-1425, 38-77-285, 38-77-920, 38-77-940, 38-77-950, and 38-77-960 are repealed on October 1, 1994.
SECTION 28. Section 38-77-111 of the 1976 Code, as added by
Act 148 of 1989, is amended to read:
"Section 38-77-111. An automobile insurer may cede the
coverages of an automobile insurance policy that it is mandated to
write to the Reinsurance Facility Joint Underwriting
Association but it may not cede coverages under a policy that it
is not mandated by law to write except for tort liability and
personal protection coverages and uninsured motorist coverage for
those risks that do not qualify for the safe driver discount.
However, if an insurer cedes a coverage it is mandated to write by
law, it shall cede all coverages under that policy that it is mandated to
write."
SECTION 29. If any provision of the act or the application thereof
to any person or circumstance is held to be unconstitutional or
otherwise invalid, the remainder of this act and the application of such
provision to other persons or circumstances are not affected thereby,
and it is to be conclusively presumed that the legislature would have
enacted the remainder of this act without such invalid or
unconstitutional provision, except that if Section 38-78-110 or Section
38-78-120 is found to be unconstitutional or invalid it is to be
conclusively presumed that the legislature would not have enacted the
remainder of this act without such limitations, and the entire act is
invalid. If Section 38-78-110 is found to be unconstitutional or
invalid, personal protection insurers have no obligation to pay personal
protection benefits with respect to accidents occurring on or after the
date of the finding of such unconstitutionality or invalidity and, in
addition, are subrogated to all of the rights of personal protection
insureds for all previous such benefits paid.
SECTION 30. Except as otherwise specifically provided herein, this
act takes effect upon approval by the Governor.
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