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Indicates Matter Stricken
Indicates New Matter
April 30, 2002
S. Printed 4/30/02--H.
Read the first time April 11, 2002.
TO AMEND CHAPTER 10, TITLE 56, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO MOTOR VEHICLE REGISTRATION AND FINANCIAL SECURITY BY ADDING ARTICLE 7 SO AS TO ENACT THE "MOTORIST INSURANCE IDENTIFICATION DATABASE PROGRAM ACT", AND TO PROVIDE THAT MOTORIST INSURANCE IDENTIFICATION DATA MUST BE COMPILED IN A DATABASE TO BE USED WHEN COMPLIANCE WITH THE STATE'S MOTOR VEHICLE FINANCIAL SECURITY REQUIREMENTS MUST BE VERIFIED; TO AMEND SECTION 56-10-553, RELATING TO THE COLLECTION OF CERTAIN DATA BY THE DEPARTMENT OF PUBLIC SAFETY THROUGH THE USE OF RANDOM SAMPLING, SO AS TO ELIMINATE THE RANDOM SAMPLING PROCEDURE; TO AMEND SECTION 56-10-40, AS AMENDED, RELATING TO THE REQUIREMENT THAT PROVIDERS OF LIABILITY INSURANCE AND PROVIDERS OF SECURITY IN LIEU OF LIABILITY INSURANCE MUST NOTIFY THE DEPARTMENT OF PUBLIC SAFETY OF THE LAPSE OR TERMINATION OF AN INSURANCE POLICY OR SECURITY IT HAS ISSUED, AND THAT PROVIDES THAT THE DEPARTMENT MUST NOTIFY THE PERSON WHOSE INSURANCE POLICY OR SECURITY HAS LAPSED OR HAS BEEN TERMINATED, SO AS TO REVISE THE PROCEDURE IN WHICH AN INSURANCE PROVIDER MUST NOTIFY THE DEPARTMENT WHEN AN INSURANCE POLICY OR SECURITY HAS LAPSED OR HAS BEEN TERMINATED; TO AMEND SECTION 56-10-240, AS AMENDED, RELATING TO THE REQUIREMENT THAT AN UNINSURED MOTOR VEHICLE MUST BE INSURED WITHIN A SPECIFIC PERIOD OF TIME OR THE OWNER MUST SURRENDER ITS REGISTRATION AND LICENSE PLATE, SO AS TO REVISE THE PROCEDURE IN WHICH AN INSURER SHALL NOTIFY THE DEPARTMENT OF PUBLIC SAFETY WHEN AN INSURED'S MOTOR VEHICLE BECOMES AN UNINSURED MOTOR VEHICLE, AND PROVIDE THAT AN INSURER MUST NOTIFY THE DEPARTMENT OF ALL FIRST TIME AND RENEWAL POLICIES IT ISSUES, TO DELETE A PROVISION THAT REQUIRES THE FORWARDING OF SURRENDERED LICENSE PLATES TO THE DEPARTMENT OF REVENUE, AND TO DELETE THE FIVE DOLLAR REINSTATEMENT FEE ASSESSED AGAINST A PERSON WHO VOLUNTARILY SURRENDERS HIS LICENSE PLATE AND REGISTRATION CERTIFICATE BEFORE THEY ARE SUSPENDED UNDER CERTAIN CIRCUMSTANCES.
Amend Title To Conform
Be it enacted by the General Assembly of the State of South Carolina:
SECTION 1. Chapter 10, Title 56 of the 1976 Code is amended by adding:
Section 56-10-610. This article may be cited as the 'Motorist Insurance Database Program Act'.
Section 56-10-620. As used in this article, unless the context otherwise requires:
(1) 'Contractor' means designated agent or the party with which the division contracts pursuant to Section 56-10-640.
(2) 'Database' means the motorist insurance database described in Section 56-10-640.
(3) 'Department' means the Department of Public Safety.
(4) 'Division' means the Motor Vehicles Division in the Department of Public Safety.
(5) 'Program' means the motorist insurance database program created in Section 56-10-640.
Section 56-10-630. (A) The General Assembly finds that the purpose of this article is to help reduce the uninsured motorist population in this State and to measure the effectiveness of the motorist insurance database established pursuant to this article.
(B) The General Assembly further recognizes that the information and data required to be disclosed by insurers in creating and maintaining the motorist insurance database is proprietary in nature. Accordingly, the parties handling this information and data must at all times maintain its confidential and proprietary nature.
(C) The motorist insurance database program is created for the purpose of establishing a database to use when verifying compliance with the motor vehicle financial security requirements in this chapter.
Section 56-10-640. (A)(1) The motorist insurance database program shall be administered by the division. Pursuant to the South Carolina Consolidated Procurement Code, the division may contract with a contractor who may provide a system of transmitting data from insurance companies. The division must solicit and receive at least two bids on the contract before awarding the contract.
(2) The department shall convene a working group chaired by the director of the division or his designee for the purpose of facilitating the implementation of the program, assisting in development of regulations, and coordinating a testing phase, and necessary changes identified in this testing phase, as prescribed by the working group. The working group shall consist of five representatives of the insurance industry appointed by the Director of the Department of Insurance. The working group shall also consist of the Director of the Department of Insurance, or his designee, the Director of the Motor Vehicles Division, or his designee, and any contractor. The working group shall issue a report to the Motor Vehicles Division and the Department of Insurance twelve months after the program is implemented to evaluate the program's effectiveness in identifying uninsured motorists. The working group may issue recommendations for database enhancements.
(B) The Motor Vehicles Division shall develop, in a manner prescribed by the department, a system to allow the transmission of data from insurance companies to the division.
(C) The department, with input from the Department of Insurance, shall promulgate regulations for administering and enforcing this article. The regulations shall specify the requirements that are necessary and appropriate for commercial lines of insurance, as defined in Title 38, which shall be developed with input by the Department of Insurance.
(D) The division for a fee prescribed and promulgated by regulation, shall make available to insurers by subscription a monthly electronic list of newly-licensed drivers. This list must not be used for marketing, solicitation, or another purpose not specifically enumerated here. It may only be used to provide an additional method to reduce the uninsured motorist population. This monthly list of newly-licensed drivers must show the: name and gender of the driver, address, date of birth, South Carolina driver's license number, and, if available, insurance information provided in the liability certification portion of the application for a driver's license. This information may be used for:
(1) determining if a newly-licensed driver is insured;
(2) assigning a newly-licensed driver to the proper automobile insurance policy for rating purposes; and
(3) ordering a motor vehicle report on a newly-licensed driver.
Section 56-10-650. (A) If the database indicates that a motor vehicle is not insured or if the division receives notification as prescribed by regulation that a vehicle may not be insured, the division shall notify the owner of the motor vehicle that he has forty-five days to provide the division with one of the following, or the owner's license plates will be subject to suspension:
(1) proof of complying coverage in accordance with Section 56-10-10 or 56-10-220, or of self-insurance in accordance with Section 56-9-60; or
(2) proof of exemption from the financial security requirements.
(B) Verification in a manner prescribed by regulation from an insurer or agent verifying that the person had the required motor vehicle insurance coverage on the date specified is considered proof of financial responsibility for purposes of this section.
(C) The provisions of this section take effect no later than one hundred eighty days after certification by the department as provided in Section 10.
Section 56-10-660. (A) The division, for a fee as prescribed and promulgated by regulation, shall disclose an individual's reported database information upon request by the following individuals and agencies only:
(1) the individual;
(2) the parent or legal guardian of an individual who is an unemancipated minor;
(3) the legal guardian of an individual who is legally incapacitated;
(4) any person who has power of attorney from the individual;
(5) any person who submits a notarized release from the individual that is dated no more than ninety days before the date the request is made;
(6) any person suffering loss or injury or against whom a claim is made for loss or injury in a motor vehicle accident in which the individual is involved, but only as part of an accident report authorized in Section 56-9-351;
(7) the office of the state auditor, for the purpose of conducting any audit authorized by law;
(8) any state or local government agency investigating, litigating, or enforcing the person's compliance with the financial security requirements; or
(9) persons regulated under Title 38 of the 1976 Code for the purposes of paying or adjudicating claims and preventing fraud or abuse.
(B) The funds collected from this fee described by subsection (A) shall be placed by the Comptroller General into a special restricted account to be used by the department to defray expenses of the division.
(C) The State is not liable to any person for gathering, managing, or using information in the database pursuant to this article.
(D) No insurer is liable to any person for performing its duties under this article unless, and to the extent, the insurer commits a wilful and wanton act or omission.
(E) Insurers shall be required to pay only those actual costs attributed to the transmission to or retrieval of their records from the division, pursuant to regulations promulgated by the Department of Insurance. The funds collected from the insurers pursuant to this subsection shall be placed by the Comptroller General into a special restricted account to be used by the department to defray expenses of the division.
Section 56-10-670. This article shall not supersede other actions or penalties that may be taken or imposed for violation of the financial security requirements of this chapter."
SECTION 2. Section 56-10-553 of the 1976 Code, as added by Act 154 of 1997, is amended to read:
(A) The Department of Public Safety must collect data and maintain statistics on the total number of vehicles registered in the State as of June thirtieth of each year, the number of motorists who voluntarily paid the five hundred and fifty dollar fee at the time of registration during the fiscal year, the number of motorists who paid the penalty fee after being detected by the Department of Public Safety as being uninsured during the fiscal year, the number of certificates of insurance filed during the fiscal year, the net revenue collections for these fees by the fiscal year, the net funds available in the Uninsured Motorist Fund, and the net funds received from the Department of Insurance from the uninsured motorist fee during the fiscal year.
(B) The Department of Public Safety must implement programs designed to ensure full compliance with the financial responsibility laws. These programs must include random sampling of licensed drivers with moving violations requesting proof of insurance. Other programs may be added.
(C) The Department of Public Safety must on a daily basis select a computerized random sample of five hundred of the registered vehicles in the State and mail to each owner a written request form to be completed by him and his insurance company or the agent issuing the policy to verify liability insurance coverage. The form must be in a manner prescribed by regulation of the department. The completed and verified form must be returned by the 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 is uninsured, and vehicles determined to be uninsured under this section are subject to the provisions of state law dealing with uninsured vehicles.
(D) The Department of Public Safety must provide an annual report to the General Assembly and the Department of Insurance containing the information required in subsections (A) and (B) of this section."
SECTION 3. Section 56-10-225 of the 1976 Code, as last amended by Act 90 of 2001, is further amended to read:
"Section 56-10-225. (A) A person whose application for registration and licensing of a motor vehicle has been approved by the department must maintain in the motor vehicle at all times proof that the motor vehicle is an insured vehicle in conformity with the laws of this State and Section 56-10-510.
(B) The owner of a motor vehicle must maintain proof of financial responsibility in the motor vehicle at all times, and it must be displayed upon demand of a police officer or any other person duly authorized by law.
(C) A person who fails to maintain the proof of insurance in his motor vehicle as required by subsection (A) is guilty of a misdemeanor and, upon conviction, is subject to the same punishment as provided by law for failure of the person driving or in control of a motor vehicle to carry the vehicle registration card and to display the registration card upon demand. However, a charge of failing to maintain proof that a motor vehicle is insured must be dismissed if the person provides proof to the court that the motor vehicle was insured
at the time of the violation to the court within seven days of being charged with a violation of the provision contained in subsection (A) on the date of the violation. Upon notice of conviction, the department shall suspend the owner's driver's license until satisfactory proof of insurance is provided. If at any time the department determines that the vehicle was without insurance coverage, the owner's registration and driving privileges will be suspended pursuant to Section 56-10-520. A person failing to maintain in his vehicle the proof required pursuant to subsection (A), within thirty days of being cited for this failure, shall provide proof of insurance or have his driver's license suspended until satisfactory proof is provided. Further, this proof must be provided every quarter for one year after being cited for driving without proof of liability insurance. Failure to provide this proof when required shall cause his driver's license to be suspended until satisfactory proof is provided.
(D) The penalties provided in subsection (C) are in addition to, and not in lieu of, any other penalty, of whatever nature, provided by law for failing to act as required in subsection (A)."
SECTION 4. Section 56-10-520 of the 1976 Code, as added by Act 154 of 1997, is amended to read:
"Section 56-10-520. A person who owns an uninsured motor vehicle:
(1) licensed in the State; or
(2) subject to registration in the State;
who operates or permits the operation of that motor vehicle without first having paid to the director the uninsured motor vehicle fee required by Section 56-10-510, to be disposed of as provided by Section 56-10-550,
shall be is guilty of a misdemeanor.
A person who is the operator of
such an uninsured motor vehicle and not the titled owner, who knows that the required fee has not been paid to the director, shall be is guilty of a misdemeanor and, upon conviction, must: for a first offense be fined no less than one hundred dollars and not more than two hundred dollars or imprisoned for thirty days; for a second offense be fined two hundred dollars or imprisoned for thirty days, or both; or for a third or subsequent offense must be imprisoned for not less than forty-five days nor more than six months. 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.
The director or his designee, having reason to believe that a motor vehicle is being operated or has been operated on any specified date, may require the owner of such motor vehicle to submit the certificate of insurance provided for by Section 56-10-510. The refusal or neglect of the owner who has not, before the date of operation, paid the uninsured motor vehicle fee required by Section 56-10-510 as to such motor vehicle, to furnish such certificate must be prima facie evidence that the motor vehicle was an uninsured motor vehicle at the time of such operation. A person who presents or causes to be presented to the director a false certificate that a motor vehicle is an insured motor vehicle or false evidence that a motor vehicle sought to be registered is an insured motor vehicle, is guilty of a misdemeanor and, upon conviction, must be fined pursuant to Section 56-10-260.
However, the foregoing portions of this section must not be applicable if it is established that the owner had good cause to believe and did believe that such motor vehicle was an insured motor vehicle, in which event the provisions of Section 56-10-245 must be applicable.
Abstracts of records of conviction, as defined in this title, of any violation of any of the provisions of this section must be forwarded to the director as prescribed by Section 56-9-330. The director shall suspend the driver's license and all registration certificates and license plates of any titled owner of an uninsured motor vehicle upon receiving
a record of his conviction of a notice of a violation of any provisions of this section, and he the director shall not thereafter reissue the driver's license and the registration certificates and license plates issued in the name of such person until such person pays the fee applicable to the registration of an uninsured motor vehicle as prescribed in Section 56-10-510 and furnishes proof of future financial responsibility as prescribed by this section. Notice of such suspension shall be made in the form provided for in Section 56-1-465. However, when three years have elapsed from the date of the suspension herein required proof was required, the director may relieve such the person of the requirement of furnishing proof of future financial responsibility. When such the suspension results from a conviction for presenting or causing to be presented to the director a false certificate as to whether a motor vehicle is an insured motor vehicle or false evidence that any motor vehicle sought to be registered is insured, then the director shall not thereafter reissue the driver's license and the registration certificates and license plates issued in the name of such the person so convicted for a period of one hundred eighty days from the date of such the order of suspension, and only then when all other provisions of law have been complied with by such the person. The director shall suspend the driver's license of any person who is the operator but not the titled owner of a motor vehicle upon receiving a record of his conviction of a notice of a violation of any provisions of this section, and he shall not thereafter reissue the driver's license until thirty days from the date of such the order of suspension."
SECTION 5. Section 56-10-40 of the 1976 Code, as last amended by Act 459 of 1996, is further amended to read:
"Section 56-10-40. Every insurer writing automobile liability insurance in this State and every provider of other security approved and accepted by the director or his designee in lieu of such insurance shall
immediately notify the department in a manner prescribed by regulation of the lapse or termination of any such insurance or security during the immediately preceding month as prescribed by regulation. issued to or provided for a resident of this State in the following circumstances: This notification must be made in a manner prescribed by the working group.
(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.
This notification must be in writing or magnetic media in a manner considered satisfactory to the department. Upon receipt of any such notice the department shall make a reasonable effort to notify the person that his certificate of registration has been suspended and shall recover the certificate from such person and the motor vehicle registration plates from the vehicles concerned."
SECTION 6. Section 56-10-240 of the 1976 Code, as last amended by Act 82 of 2001, is further amended to read:
"Section 56-10-240. (A) If, during the period for which it is licensed, a motor vehicle 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 an automobile liability insurance premium is not paid within five working days after the last day to pay the 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, and 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 if 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.
(B) The department, in its discretion, may authorize insurers to utilize alternative methods of providing notice of cancellation,
of or refusal to renew, new policies written, and renewals 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 Director of the Department of Insurance. If the Director of the Department of Insurance 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 forwarded to the Department of Revenue office in the county where the person who surrenders the plates resides.
(C) 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 shall 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. A person who voluntarily surrenders his license plates and registration certificate before their suspension shall
only not be charged a reinstatement fee of five dollars.
(D) 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.
(E) 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 7. The 1976 Code is amended by adding:
"Section 56-10-46. A person responding to the notice contained in Section 56-10-40 who purchased insurance after receiving the notice shall have his motor vehicle record noted to indicate that he will be subject to regular requests for proof of insurance from the Motor Vehicles Division. The person shall be required to provide proof of coverage as prescribed by regulation every seven months for a period of three years."
SECTION 8. The 1976 Code is amended by adding:
"Section 56-10-615. The Motor Vehicles Division shall obtain information from insurers regarding cancellations of automobile insurance policies. The division shall request proof of insurance from persons identified by the Motorist Insurance Database. A person who fails to respond to the division must be penalized as provided in Article 5 of this chapter."
SECTION 9. Section 38-73-470 of the 1976 Code is amended to read:
One dollar Two dollars of the yearly premium for uninsured motorist coverage is directed to be paid to the South Carolina Department of Public Safety to be placed on deposit with the State Treasurer in the 'Uninsured Enforcement Fund', payable on a quarterly basis, to provide for the costs of enforcing and administering the provisions of Article 3, Chapter 10, Title 56. Of the two dollars collected, eighty cents must be distributed to the South Carolina Highway Patrol and one dollar twenty cents must be distributed to the Motor Vehicles Division. Interest earned by the 'Uninsured Fund' must be retained by that fund. There is no requirement for an insurer or an agent to offer underinsured motorist coverage at limits less than the statutorily required bodily injury or property damage limits."
SECTION 10. Section 56-10-270 of the 1976 Code is repealed.
SECTION 11. Section 56-3-220 of the 1976 Code is repealed.
SECTION 12. This act takes effect July 1, 2002; provided, however, that Sections 5, 6, and 9 are effective one hundred eighty days after the latter of certification by the department to the President Pro Tempore of the Senate and the Speaker of the House of Representatives that the program has been implemented and is fully prepared to accept data transmitted by the insurers or publication of final regulations by the department.
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