Car Insurance Laws Go into Effect at Turn of New Year

Document of car Insurance Policy for backgroundThe New Year that begins tomorrow will mean a few changes to car insurance-related laws in several states across the U.S.

Beginning Wednesday, drivers in California, Texas, Oklahoma and Nevada will be subject to new laws taking effect.

California Auto Policies Can Be Renewed Electronically

A law that goes into effect on Jan. 1, 2014, will open California’s door to conducting auto insurance-related business on-the-go.

Policyholders there who want to renew their California car insurance policy can choose to do so electronically under SB 251, a piece of legislation that was signed into law in September and cheered by the Association of California Insurance Companies (ACIC), a state industry group.

“This new law gives consumers choices and flexibility,” Armand Feliciano, ACIC’s vice president, said in a statement. “Policyholders can continue to use regular mail to renew or they can opt in and use available technology to electronically renew.”

Similar state laws have propagated across the U.S. in the past year; the industry has dubbed them as “e-delivery” and “e-posting” laws.

Feliciano said that the newly effective California law allows the state’s car insurers to be more responsive to their customers’ needs, which often means taking business mobile via a laptop or smartphone.

SB 251 “gives consumers and insurers the tools and choices they need,” Feliciano said in ACIC’s statement, which also cited a study that showed that consumers are increasingly leaning toward mobile technology.

Oklahoma to Start Seizing Plates of Uninsured Drivers

Oklahoma’s long-running battle against uninsured drivers in the state will see a new chapter on Jan. 1 as the state stiffens penalties for motorists who are on the road without coverage.

HB 1792 was introduced to much political fanfare earlier this year, with traffic safety and regulatory officials in the insurance industry applauding the piece of legislation as a comprehensive approach to a years-long problem in the state. Among other things, the bill allows police to confiscate license plates of drivers they find to lack insurance and requires those drivers to obtain coverage from a temporary car insurer.

The rate of uninsured drivers in Oklahoma is above the national average, spurring the bill’s sponsoring representative to label the problem a “plague on Oklahoma motorists for decades.”

Portions of HB 1792 have developed since it was signed into law in April.

Earlier this month, the state tapped an Oklahoma-based insurer as the carrier that will provide temporary coverage for uninsured drivers as those drivers search for coverage elsewhere.

But meat of the legislation—enforcement—kicks in on Wednesday. Authorities, trained on the new procedures instituted by HB 1792, will begin seizing plates of uninsured drivers starting on Jan. 1, 2014.

Nevada Driver Authorization Cards Available

The New Year will usher in fresh availability of driving rights for many Nevada motorists, as well as a rush of those motorists to car insurance providers.

Lawmakers predict that tens of thousands of undocumented drivers in Nevada will apply for “driver authorization cards.” The cards were made available by SB 303, a piece of legislation allowing the cards to be issued to Nevada drivers, regardless of their immigration status, and makes them subject to the state’s requirements for driving and insurance coverage.

Nevada’s bill contains provisions similar to other pieces of legislation across the U.S., all of which open driving rights to undocumented immigrants in various ways, including an amendment in Washington, D.C., that created “limited purpose” licenses available to drivers lacking legal status.

Such state proposals have sparked similarly varied reactions from lawmakers and drivers.

Before signing SB 303 into law, Nevada Gov. Brian Sandoval said it would strengthen public safety on the state’s roads.

But in Oregon, the availability of driving licenses to undocumented immigrants was delayed and now hinges on a November 2014 referendum. Voters will go to the ballot box to decide the fate of the licensing program created through a bill that lawmakers there passed in May.

Texas Sets More Requirements around Household Exclusions

Starting on Wednesday in Texas, a law will apply new requirements to auto insurance policies that consumer advocates said were needed to better define the extent of coverage for “named-drivers” in a policyholder’s household.

According to a state analysis of SB 1567, a “named-driver” auto policy “covers only household residents who are specifically named on the policy.”

However, the analysis added, consumers need a more stark reminder of that definition, which spurred the passage of SB 1567. The new law requires, before any fee or premium is paid for a policy, that Texas car insurers “disclose orally and in writing to a person on a named-driver policy that such automobile insurance coverage would not extend to any person residing in the insured’s household not named on the policy.”

The new requirements set down by the bill applies to policies “issued or renewed on or after” Jan. 1, 2014, according to the analysis.

American Access Casualty Company issued a leadup notice, stating that, effective Wednesday, all identification cards and declaration pages for car policies in Texas will include the following language:

“Warning: A named driver policy does not provide coverage for individuals residing in the insured’s household that are not named on the policy.”

Ohio Liability Policy Minimums Increase

Any Ohio driver currently carrying a liability policy at minimum levels of 12.5/25/7.5 can expect a change at his or her next renewal period because of a law that went into effect last week.

After Dec. 22, those liability policies will be renewed at newly increased minimum levels of 25/50/25. The new minimums were set by HB 278, which supporters said could increase the price of such policies but was necessary to bring the Ohio’s liability minimums in line with the minimums enforced in other states.

The new minimums also apply to new policies issued after Dec. 22.

About Charles Nguyen
Charles Nguyen is an enterprising journalist who reported for Patch.com and the Desert Dispatch and was the editor in chief of the Guardian (the twice-weekly newspaper at the University of California, San Diego) before coming to Online Auto Insurance News.

No comments yet.

Comment on this article