Bill Text: NY A06335 | 2021-2022 | General Assembly | Amended
Bill Title: Establishes an online insurance verification system for proof of insurance; allows the use of third-party vendors and providers; requires motor vehicle insurers to provide policy information to the online verification system; establishes an online insurance verification advisory council; requires certain information to be confidential and propriety information which is not subject to disclosure.
Spectrum: Partisan Bill (Democrat 4-0)
Status: (Introduced - Dead) 2022-05-04 - print number 6335b [A06335 Detail]
Download: New_York-2021-A06335-Amended.html
STATE OF NEW YORK ________________________________________________________________________ 6335--B 2021-2022 Regular Sessions IN ASSEMBLY March 16, 2021 ___________ Introduced by M. of A. GUNTHER, HUNTER, D. ROSENTHAL -- read once and referred to the Committee on Transportation -- recommitted to the Committee on Transportation in accordance with Assembly Rule 3, sec. 2 -- committee discharged, bill amended, ordered reprinted as amended and recommitted to said committee -- again reported from said commit- tee with amendments, ordered reprinted as amended and recommitted to said committee AN ACT to amend the vehicle and traffic law, in relation to establishing an online insurance verification system for proof of insurance; to establish an online insurance verification advisory council; and to repeal certain provisions of such law relating to motor vehicle insur- ance and funds for a certain pilot database system The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. Short title. This act shall be known and may be cited as 2 the "New York state fairness for drivers act". 3 § 2. Paragraphs (a), (b), (c) and (d) of subdivision 2 and paragraphs 4 (a), (b), (c), (d), (f), (g), (h) and (i) of subdivision 4 of section 5 313 of the vehicle and traffic law are REPEALED. 6 § 3. Paragraph (d) of subdivision 3 of section 317 of the vehicle and 7 traffic law is REPEALED. 8 § 4. The vehicle and traffic law is amended by adding a new section 9 312-b to read as follows: 10 § 312-b. Online insurance verification system of motor vehicle insur- 11 ance. 1. The commissioner shall establish a system for the online 12 verification of insurance. Information available in the online insurance 13 verification system shall be provided by motor vehicle insurers pursuant 14 to section three hundred twelve-c of this article. Notwithstanding any 15 other provision of law or regulation to the contrary, the online insur- 16 ance verification system shall be the only verification system used to 17 verify evidence of mandatory vehicle insurance as required by section EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD09703-05-2A. 6335--B 2 1 three hundred twelve of this article. The commissioner shall consult 2 with representatives of the insurance industry and private service 3 providers in determining the objectives, details and deadlines related 4 to the online insurance verification system. 5 2. The online insurance verification system shall include, at a mini- 6 mum, the ability to: 7 (a) send requests to insurers for verification of evidence of insur- 8 ance via web services established by the insurers, through the internet, 9 or a similar proprietary or common carrier electronic system, in compli- 10 ance with the specifications and standards of the insurance industry 11 committee on motor vehicle administration; 12 (b) include appropriate provisions to secure data against unauthorized 13 access and the department shall maintain a historical record of the 14 system data for six to twelve months from the date of all requests and 15 responses; 16 (c) be utilized for verification of the evidence of mandatory liabil- 17 ity insurance coverage as prescribed by the laws of the state and shall 18 be accessible to authorized personnel of the department, the courts, law 19 enforcement, and any other entities authorized by the state as permitted 20 by any state or federal privacy laws, and the online insurance verifica- 21 tion system shall be interfaced, wherever appropriate, with existing 22 state systems; 23 (d) include information which shall enable the department to make 24 inquiries to insurers for evidence of insurance that is consistent with 25 the insurance industry committee on motor vehicle administration recom- 26 mendations, including specifications and standards that utilize multiple 27 data elements for greater matching accuracy from the national associ- 28 ation of insurance commissioners, vehicle identification numbers, policy 29 numbers, or as described in the specifications and standards of the 30 insurance industry committee on motor vehicle administration; and 31 (e) respond to each request for insurance information within a reason- 32 able amount of time which shall be determined by the commissioner and 33 the online insurance verification system shall be capable of responding 34 within the time established. 35 3. The commissioner, in conjunction with the superintendent of state 36 police and local law enforcement officials, shall formulate a means to 37 allow the online insurance verification system to be easily accessible 38 to on-duty law enforcement personnel in the performance of their offi- 39 cial duties for the purpose of verifying whether an operator of a motor 40 vehicle maintains proper insurance coverage and to increase compliance 41 with the motor vehicle financial security laws under this article and 42 article eight of this title. 43 4. (a) The commissioner shall develop a computer bar code system that 44 can be imprinted on a vehicle registration sticker or on a sticker to be 45 affixed to the insured's license plate either simultaneously or after 46 the online insurance verification system has been established. 47 (b) Such computer bar code shall enable authorized persons in the 48 performance of their official duties to access information such as the 49 registrant's name, vehicle identification number, name of insurer, 50 current status of premium payment, driver's license number, vehicle 51 registration number and other information that the commissioner deems 52 necessary to implement the provisions of this section. The commissioner 53 in developing such bar code system shall enable authorized persons in 54 the performance of their official duties to access only such information 55 that is necessary to detect uninsured motor vehicles or accomplish other 56 goals clearly established and authorized by law. Such system shall beA. 6335--B 3 1 designed to protect the personal privacy interests of motorists, and 2 shall at a minimum include security features used in PDF417 technology 3 or greater. 4 5. (a) Nothing in this section shall prohibit the commissioner from 5 contracting with a private service provider or providers who have 6 successfully implemented similar online insurance verification systems 7 in other states or to assist in establishing and maintaining such system 8 in this state. 9 (b) The commissioner and any private service provider shall each sepa- 10 rately maintain a contact person for insurers during the establishment, 11 implementation and operation of the online insurance verification 12 system. 13 6. The commissioner shall publish for comment and then post a detailed 14 guide of the online insurance verification system on the department's 15 website. 16 7. Within two years after the online insurance verification system is 17 installed and fully operational, the commissioner, after consultation 18 with insurers, shall prepare and submit to the governor, the temporary 19 president of the senate, the speaker of the assembly, the minority lead- 20 er of the senate and the minority leader of the assembly a report 21 containing the costs of the online insurance verification system 22 incurred by the department, insurers and the public and the effective- 23 ness of the such system in reducing the number of uninsured motor vehi- 24 cles. 25 8. The online insurance verification system shall be installed and 26 fully operational within eighteen months after the effective date of 27 this section and shall undergo an appropriate testing and pilot period 28 of not less than nine months. Until the successful completion of the 29 testing and pilot period, no enforcement action shall be taken based on 30 the online insurance verification system. 31 9. Notwithstanding any other provision of law or regulation to the 32 contrary, the provisions to secure data against unauthorized access 33 required pursuant to paragraph (b) of subdivision two of this section 34 shall require the following: 35 (a) The information obtained by the department pursuant to this 36 section shall be deemed confidential and proprietary information and 37 shall not be deemed to be a public record subject to disclosure pursuant 38 to the public officers law. 39 (i) Such information shall not be used, sold, accessed, utilized in 40 any manner or released by the department to any person, corporation, or 41 state and local agency, unless explicitly authorized to be released to 42 parties that are entitled to such information pursuant to this section. 43 (ii) Such information may be released to another state or local agency 44 or other persons if the department, insurer and attorney general all 45 consent to the release of a certain type, class or classification of 46 information. 47 (iii) The department shall institute appropriate measures to ensure 48 that only authorized persons are permitted to access such information 49 for the purposes specified by this section. 50 (b) Persons who knowingly release or disclose information from the 51 online insurance verification system for a purpose other than those 52 described as authorized by this section or to a person not entitled to 53 receive it shall be guilty of a misdemeanor for each such release or 54 disclosure. 55 (c) The department shall continue to release information that it 56 currently discloses to the public such as motor vehicle registration andA. 6335--B 4 1 title abstracts, other reports concerning a motor vehicle operators' 2 driving history and insurance claims history, and information to a 3 person or persons suffering a loss or injury due to a motor vehicle 4 accident in which an insured individual was involved. 5 § 5. The vehicle and traffic law is amended by adding a new section 6 312-c to read as follows: 7 § 312-c. Insurer responsibilities for the online insurance verifica- 8 tion system. 1. (a) Insurers shall coordinate with the commissioner in 9 establishing and maintaining the online insurance verification system 10 established pursuant to section three hundred twelve-b of this article, 11 and shall provide access to motor vehicle insurance policy status infor- 12 mation as provided by any rules and regulations promulgated by the 13 commissioner. 14 (b) Every insurer that is licensed to issue motor vehicle insurance 15 policies or is authorized to do business in the state shall comply with 16 this section and section three hundred twelve-b of this article for 17 verification of evidence of vehicle insurance for every vehicle insured 18 by that insurer in the state as required by the rules and regulations 19 promulgated by the commissioner. 20 (c) Insurers shall maintain a historical record of the online insur- 21 ance verification system data for a maximum period of six months from 22 the date any request and response is made. 23 (d) Insurers shall respond to requests from the online insurance 24 verification system within the time period prescribed by the specifica- 25 tions and standards set by the insurance industry committee on motor 26 vehicle administration. 27 2. (a) Insurers shall provide commercial automobile customers with 28 documentation that the vehicle is insured under a commercial auto poli- 29 cy. Documentation shall be an insurance identification card clearly 30 marked in the title with the following, "Commercial Auto Insurance Iden- 31 tification Card". 32 (b) For the purposes of this subdivision, "commercial auto coverage" 33 shall be defined as any coverage provided to an insured, regardless of 34 the number of vehicles or entity covered under the commercial auto 35 coverage and rated from a commercial manual approved by the department 36 of financial services. 37 3. Nothing in this section shall prohibit an insurer from using the 38 services of a third-party vendor or provider in order to comply with the 39 online insurance verification system required by sections three hundred 40 twelve and three hundred twelve-b of this article. 41 4. The commissioner may promulgate any rules and regulations necessary 42 to accommodate insurers that write a limited number of policies in the 43 state and such insurers that would be unduly burdened by this section. 44 § 6. a. There is hereby established an online insurance verification 45 advisory council. It shall consist of 14 voting members to be appointed 46 as follows: the commissioner of the department of motor vehicles or his 47 or her duly designated representative, the superintendent of financial 48 services or his or her duly designated representative, the superinten- 49 dent of the New York State Police or his or her duly designated repre- 50 sentative; and eleven at-large members, of which, two members shall be 51 appointed by the governor, two members shall be appointed by the tempo- 52 rary president of the senate, two members shall be appointed by the 53 speaker of the assembly, one member shall be appointed by the minority 54 leader of the senate, one member shall be appointed by the minority 55 leader of the assembly, as well as three insurance company represen- 56 tatives, one appointed by the New York Insurance Association, oneA. 6335--B 5 1 appointed by the American Property and Casualty Insurance Association, 2 and one appointed by the National Association of Mutual Insurance Compa- 3 nies. The commissioner of the department of motor vehicles, or his or 4 her duly designated representative, shall serve as chairperson of the 5 advisory council. The eleven appointed members shall serve at the pleas- 6 ure of the appointing official or organization. Vacancies shall be 7 filled in the manner provided for original appointments. 8 b. The members of the advisory council shall receive no compensation 9 for their services. 10 c. Notwithstanding any inconsistent provision of any general, special 11 or local law, ordinance, resolution or charter, no officer, member or 12 employee of the state or of any public corporation shall forfeit his or 13 her office or employment by reason of his or her acceptance of appoint- 14 ment as a member of the advisory council, nor shall service as such 15 council member be deemed incompatible or in conflict with such office or 16 employment. 17 d. The advisory council is charged with the following duties: 18 (1) Facilitate the implementation of the online insurance verification 19 system; 20 (2) Develop a guide for insurers providing data and other information 21 necessary for compliance along with other necessary regulations; 22 (3) Coordinate and conduct a testing phase; 23 (4) Identify necessary changes during the testing phase; and 24 (5) Issue recommendations based on periodic reviews of the online 25 insurance verification system. 26 e. The advisory council may request and shall receive from any subdi- 27 vision, department, board, commission, office, agency, or other instru- 28 mentality of the state or of any political subdivision thereof such 29 facilities, assistance and data as it deems necessary or desirable for 30 the proper execution of its powers and duties and to effectuate the 31 purposes set forth in this act. 32 § 7. Subdivision 1 of section 312 of the vehicle and traffic law is 33 amended by adding a new paragraph (c) to read as follows: 34 (c) When the department has evidence that a motor vehicle has been or 35 is currently being operated without insurance, the owner's vehicle 36 registration may be suspended or revoked. The current registration shall 37 not be reinstated and new registration shall not be issued unless 38 evidence of insurance has been provided to the department and any appli- 39 cable reinstatement fees as prescribed by the department have been paid. 40 Any applicable fees are in addition to any other fines, penalties and 41 fees required by law. 42 § 8. Subdivision 1 of section 312-a of the vehicle and traffic law, as 43 amended by chapter 781 of the laws of 1983, is amended to read as 44 follows: 45 1. Upon issuance of an owner's policy of liability insurance or other 46 financial security required by this chapter, an insurer shall issue 47 proof of insurance in accordance with the regulations promulgated by the 48 commissioner pursuant to [paragraph (b) of subdivision two of section] 49 sections three hundred [thirteen] twelve-b and three hundred twelve-c of 50 this article. 51 § 9 This act shall take effect immediately; provided, however, 52 sections two and three of this act shall take effect when the online 53 insurance verification system is installed and fully operational pursu- 54 ant to subdivision 8 of section 312-b of the vehicle and traffic law, as 55 added by section four of this act; and provided further, sections four, 56 five, seven and eight of this act shall take effect one year after itA. 6335--B 6 1 shall have become a law. Effective immediately, the addition, amendment 2 and/or repeal of any rule or regulation necessary for the implementation 3 of this act on its effective date are authorized to be made on or before 4 such date.