1993-94 Bill 4399: Motor vehicle private passenger physical coverage

South Carolina General Assembly
110th Session, 1993-1994

Bill 4399

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                    Current Status

Introducing Body:               House
Bill Number:                    4399
Primary Sponsor:                J. Bailey
Type of Legislation:            GB
Subject:                        Motor vehicle private
                                passenger physical coverage
Residing Body:                  House
Computer Document Number:       GJK/20202SD.94
Introduced Date:                19940111
Last History Body:              House
Last History Date:              19940322
Last History Type:              Objection withdrawn by
                                Representative
Scope of Legislation:           Statewide
All Sponsors:                   J. Bailey
                                Corning
Type of Legislation:            General Bill

History

Bill Body Date Action Description CMN Leg Involved ____ ______ ____________ ______________________________ ___ ____________ 4399 House 19940322 Objection withdrawn by Scott Representative 4399 House 19940222 Objection by Representative Scott Inabinett Breeland J. Brown Neal Harwell Anderson Hines Williams 4399 House 19940209 Committee Report: Favorable 26 with amendment 4399 House 19940111 Introduced, read first time, 26 referred to Committee 4399 House 19931215 Prefiled, referred to 26 Committee

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(Text matches printed bills. Document has been reformatted to meet World Wide Web specifications.)

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COMMITTEE REPORT

February 9, 1994

H. 4399

Introduced by REPS. J. Bailey and Corning

S. Printed 2/9/94--H.

Read the first time January 11, 1994.

THE COMMITTEE ON

LABOR, COMMERCE AND INDUSTRY

To whom was referred a Bill (H. 4399), to amend Section 38-77-280, as amended, Code of Laws of South Carolina, 1976, relating to the requirement that automobile insurers make collision and comprehensive coverage available to any insured, etc., respectfully

REPORT:

That they have duly and carefully considered the same, and recommend that the same do pass with amendment:

Amend the bill, as and if amended, by striking Section 38-77-280, as contained in SECTION 1, and inserting:

/"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, at 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 director or his designee. 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 another 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 an applicant or existing policyholder, on renewal, who has collected benefits provided under 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 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 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).

Notwithstanding the provisions of this section, and any other provision of law, an insurer is not required to write private passenger physical damage coverage for the following types of vehicles:

(1) classic cars, meaning an automobile whose monetary value exceeds the original purchase price which has appreciated in value by maintaining the original parts;

(2) antique cars, meaning an automobile over twenty-five years of age;

(3) any automobile with any modification to the chassis or wheel base;

(4) any automobile with a wheel base of ninety-nine and one-half inches or less, including utility vehicles;

(5) any automobile with a fair market value exceeding fifty thousand dollars;

(6) any automobile within the `sports group' or `sports premium group'. For the purposes of this provision `sports group' means a two-passenger body type automobile with a net weight to horsepower ratio between 20:1 and 30:1. `Sports premium group' means a two-passenger body type automobile with a net weight to horsepower ratio between 20:1 or less.

(C) All insurers subject to the provisions of this section writing single interest collision coverage shall provide an applicant for the insurance at the time of his application a notice separate and apart from any other form used in the application. The notice must be signed by the applicant evidencing his acknowledgment of having read the notice. The notice must contain the following language printed in bold face type: `NOTICE: THE INSURANCE COVERAGE YOU ARE HEREBY PURCHASING IS ONLY SINGLE INTEREST COLLISION COVERAGE. THE AMOUNT OF INSURANCE DECREASES AS YOU PAY OFF THE AMOUNT OF YOUR INDEBTEDNESS. YOU MAY NOT RECEIVE ANY INSURANCE PROCEEDS OVER and ABOVE THE AMOUNT OF THE OUTSTANDING BALANCE ON YOUR LOAN.' This notice must be provided on a form approved by the Chief Insurance Commissioner.

(C)(D) 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)(E) No policy of insurance which provides automobile physical damage coverage only may be ceded to the facility.

(E)(F) Insurers of automobile insurance may charge a rate for physical damage insurance coverages different than from those provided for in Section 38-73-457 if the rates are filed with the department and approved by the director or his designee. 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)(G) 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.

In determining the premium rates to be charged on automobile insurance, it is unlawful to consider race, color, creed, religion, national origin, ancestry, location of residence, occupation, or economic status.

(H) An insurer or agent shall provide written notice to the insured of the reason or reasons the insured was not written at the base rate."/

Amend title to conform.

THOMAS C. ALEXANDER, for Committee.

A BILL

TO AMEND SECTION 38-77-280, AS AMENDED, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE REQUIREMENT THAT AUTOMOBILE INSURERS MAKE COLLISION AND COMPREHENSIVE COVERAGE AVAILABLE TO ANY INSURED, SO AS TO PROVIDE THAT AN INSURER IS NOT REQUIRED TO WRITE PRIVATE PASSENGER PHYSICAL COVERAGE FOR SPECIFIED TYPES OF VEHICLES, TO PROVIDE THAT A CERTAIN NOTICE MUST BE PROVIDED TO APPLICANTS PURCHASING SINGLE INTEREST COLLISION COVERAGE, TO PROVIDE THAT IN DETERMINING THE PREMIUM RATES TO BE CHARGED ON AUTOMOBILE INSURANCE, IT IS UNLAWFUL TO CONSIDER RACE, COLOR, CREED, RELIGION, NATIONAL ORIGIN, ANCESTRY, LOCATION OF RESIDENCE, OCCUPATION, OR ECONOMIC STATUS, TO PROVIDE AN INSURER OR ITS AGENT SHALL PROVIDE WRITTEN NOTICE TO AN INSURED OF THE REASON HE WAS NOT WRITTEN AT THE BASE RATE, AND TO PROVIDE THAT THE CHIEF INSURANCE COMMISSIONER ANNUALLY SHALL COMPILE A COMPARATIVE STATISTICAL ANALYSIS OF PERSONS FOR WHOM PHYSICAL DAMAGE COVERAGES ARE WRITTEN AND OF PERSONS FOR WHOM PHYSICAL DAMAGE COVERAGES ARE DENIED.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. Section 38-77-280 of the 1976 Code, as last amended by Section 810, Act 181 of 1993, 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.

Notwithstanding the provisions of this section, and any other provision of law, an insurer is not required to write private passenger physical damage coverage for the following types of vehicles:

(1) classic cars, meaning an automobile whose monetary value exceeds the original purchase price which has appreciated in value by maintaining the original parts;

(2) antique cars, meaning an automobile over twenty-five years of age;

(3) any automobile with any modification to the chassis or wheel base;

(4) any automobile with a wheel base of ninety-nine and one-half inches or less, including utility vehicles;

(5) any automobile with a fair market value exceeding thirty-five thousand dollars;

(C) All insurers subject to the provisions of this section writing single interest collision coverage shall provide an applicant for the insurance at the time of his application a notice separate and apart from any other form used in the application. The notice must be signed by the applicant evidencing his acknowledgment of having read the notice. The notice must contain the following language printed in bold face type: `NOTICE: THE INSURANCE COVERAGE YOU ARE HEREBY PURCHASING IS ONLY SINGLE INTEREST COLLISION COVERAGE. THE AMOUNT OF INSURANCE DECREASES AS YOU PAY OFF THE AMOUNT OF YOUR INDEBTEDNESS. YOU MAY NOT RECEIVE ANY INSURANCE PROCEEDS OVER AND ABOVE THE AMOUNT OF THE OUTSTANDING BALANCE ON YOUR LOAN.'

(D)(E) No policy of insurance which provides automobile physical damage coverage only may be ceded to the facility.

(E)(F) Insurers of automobile insurance may charge a rate for physical damage insurance coverages different than from those provided for in Section 38-73-457 if the rates are filed with the departament and approved by the director or his designee. 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.

(H) An insurer or agent shall provide written notice to the insured of the reason or reasons the insured was not written at the base rate.

(I) The director or his designee shall compile a comparative statistical analysis of the persons for whom physical damage coverages are written and of the persons for whom physical damage coverages are denied indicating the data for the following categories: race, sex, occupation, income, and geographical territory. This report must be furnished on an annual basis to the General Assembly."

SECTION 2. This act takes effect October 1, 1994, provided that from the period October 1, 1994, to July 1, 1995, references in Section 38-77-280 of the 1976 Code to the director or his designee of the Department of Insurance must be construed to mean the Chief Insurance Commissioner.

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