380

							                                   South Carolina General Assembly
                                       117th Session, 2007-2008

S. 380

STATUS INFORMATION

General Bill
Sponsors: Senators Cromer, Ford, Ryberg, Campsen, Alexander, Scott, Bryant and Lourie
Document Path: l:\s-res\rwc\001unin.kmm.doc

Introduced in the Senate on January 31, 2007
Currently residing in the Senate Committee on Transportation

Summary: Automobile Insurance Electronic Data Service Act


HISTORY OF LEGISLATIVE ACTIONS

    Date   Body Action Description with journal page number
 1/31/2007 Senate Introduced and read first time SJ-17
 1/31/2007 Senate Referred to Committee on Transportation SJ-17

View the latest legislative information at the LPITS web site


VERSIONS OF THIS BILL

1/31/2007
 1
 2
 3
 4
 5
 6
 7
 8
 9                       A BILL
10
11   TO AMEND SECTION 38-73-470, AS AMENDED, CODE OF
12   LAWS OF SOUTH CAROLINA, 1976, RELATING TO THE
13   DISPOSITION OF THE UNINSURED MOTORIST PREMIUM,
14   SO AS TO PROVIDE THAT A PORTION OF THE PREMIUM
15   MUST BE PAID TO THE DEPARTMENT OF MOTOR
16   VEHICLES AND PLACED IN THE EDS INSURANCE FUND;
17   TO AMEND SECTION 56-1-10, AS AMENDED, RELATING
18   TO DEFINITIONS OF TERMS CONTAINED IN THE
19   PROVISIONS RELATED TO THE DEPARTMENT OF MOTOR
20   VEHICLES, SO AS TO PROVIDE DEFINITIONS FOR THE
21   TERMS “ELECTRONIC DATA SERVICES” AND “EDS
22   INSURANCE FUND”; TO AMEND SECTION 56-10-552,
23   RELATING TO THE UNINSURED ENFORCEMENT FUND,
24   SO AS TO MAKE A TECHNICAL CHANGE; AND BY
25   ADDING ARTICLE 9 TO CHAPTER 10, TITLE 56 SO AS TO
26   ENACT THE AUTOMOBILE INSURANCE ELECTRONIC
27   DATA SERVICES ACT, TO PROVIDE FOR THE PURPOSE
28   OF THIS ARTICLE, TO PROVIDE THAT THE DEPARTMENT
29   OF MOTOR VEHICLES SHALL ADMINISTER THE
30   ELECTRONIC DATA SERVICES PROVIDED PURSUANT TO
31   THIS ARTICLE, TO ESTABLISH THE EDS INSURANCE
32   FUND, TO PROVIDE THAT THE DEPARTMENT MUST
33   COLLECT DATA AND MAINTAIN STATISTICS FOR EACH
34   FISCAL YEAR IN REGARD TO ELECTRONIC DATA
35   SERVICES AND THE TRANSMISSION OR DELIVERY OF
36   DRIVER, VEHICLE, AND OTHER RELATED DATA TO THE
37   INSURANCE INDUSTRY, AND PROVIDE THAT THIS
38   ARTICLE DOES NOT SUPERSEDE OTHER ACTIONS BY
39   THE DEPARTMENT TO TRANSMIT OR DELIVER DATA IN
40   ACCORDANCE WITH THE PURPOSES OF ARTICLE 9,
41   CHAPTER 10, TITLE 56.
42

     [380]                   1
 1   Be it enacted by the General Assembly of the State of South
 2   Carolina:
 3
 4   SECTION 1. Section 38-73-470 of the 1976 Code, as last
 5   amended by Act 324 of 2002, is amended to read:
 6
 7      “Section 38-73-470. (A) Two dollars of the yearly premium
 8   for uninsured motorist coverage is directed to must be paid to the
 9   South Carolina Department of Public Safety to be and placed on
10   deposit with the State Treasurer in the „Uninsured Enforcement
11   Fund‟, payable on a quarterly basis, to provide for the costs of
12   enforcing and administering the provisions of Article 3, Chapter
13   10, Title 56. Of the two dollars collected, eighty cents must be
14   distributed to the South Carolina Highway Patrol and one dollar
15   twenty cents must be distributed to the Department of Motor
16   Vehicles. Interest earned by the „Uninsured Fund‟ must be retained
17   by that fund. There is no requirement for an insurer or an agent to
18   offer underinsured motorist coverage at limits less than the
19   statutorily required bodily injury or property damage limits.
20      (B) Fifty cents of the yearly premium for uninsured motorist
21   coverage must be paid to the Department of Motor Vehicles and
22   placed on deposit with the State Treasurer in the „EDS Insurance
23   Fund‟, payable on a quarterly basis, to provide for the cost of
24   administering the provisions of Article 9, Chapter 10, Title 56.
25   Interest earned by the „EDS Insurance Fund‟ must be retained by
26   that fund.”
27
28   SECTION 2. Section 56-1-10 of the 1976 Code, as last amended
29   by Act 170 of 2005, is further amended by adding at the end:
30
31      “(23) „Electronic Data Services‟ means the electronic
32   transmission and delivery of driver information, vehicle
33   information, and other related information to insurers and
34   insurance producers licensed in this State.
35      (24) „EDS Insurance Fund‟ means the fund established
36   pursuant to Article 9, Chapter 10 of this title to reimburse the
37   department for costs associated with providing electronic data
38   services.”
39
40   SECTION 3. Section 56-10-552(A) of the 1976 Code is amended
41   to read:
42


     [380]                            2
 1     “(A) All funds collected as provided in Section 38-73-470(A)
 2   must be directed to the director of the Department of Public Safety
 3   for the establishment and maintenance of a special fund, to be
 4   known as the „Uninsured Enforcement Fund‟, to be used by the
 5   Department of Public Safety for the purpose of enforcement and
 6   administration of Article 3, Chapter 10, Title 56.”
 7
 8   SECTION 4. Chapter 10, Title 56 of the 1976 Code is amended
 9   by adding:
10
11                               “Article 9
12
13            Automobile Insurance Electronic Data Services
14
15     Section 56-10-710. This article may be cited as the „Automobile
16   Insurance Electronic Data Services Act‟.
17
18      Section 56-10-720. (A) The General Assembly finds that the
19   purpose of this article is to help reduce inaccurate automobile
20   insurance pricing while increasing the reliability of insurance
21   policy data obtained by insurers and their licensed producers and
22   to assure that the data maintained within the motorist insurance
23   database program under Article 7 of this chapter is correct and
24   verifiable by the department.
25      (B) The General Assembly further recognizes that the driver
26   and vehicle information and other related data required for insurers
27   and their licensed producers to accurately price and issue
28   automobile insurance policies in this State is available from
29   databases maintained at the Department of Motor Vehicles.
30
31      Section 56-10-730. (A) Electronic data services provided
32   pursuant to this article must be administered by the department.
33   The department may contract with service providers who will
34   provide a system of transmitting data from the department to
35   insurers and insurance producers licensed in this State. All
36   contracts with service providers must be uniform in regard to the
37   amount and timeliness of payments to service providers by the
38   department, qualifications of service providers, and testing and
39   system requirements of service providers. An insurer may not
40   contract with the department to act as a service provider.
41      (B) The Department of Motor Vehicles shall convene a
42   working group chaired by its director or his designee, to facilitate
43   the implementation of the electronic data services, to assist in

     [380]                            3
 1   development of regulations, to audit the expenditures associated
 2   with the electronic data services and reimbursements from the EDS
 3   Insurance Fund, and to issue recommendations based on periodic
 4   reviews by the working group. The working group shall consist of
 5   eight representatives of the insurance industry. The director of the
 6   Department of Insurance shall appoint two representatives of
 7   insurance companies and two licensed, resident insurance
 8   producers. The director of the Department of Motor Vehicles shall
 9   appoint two representatives of insurance companies and two
10   licensed, resident insurance producers. The working group shall
11   also consist of the director of the Department of Insurance, or his
12   designee, and the director of the Department of Motor Vehicles, or
13   his designee.
14      (C) The working group shall develop, assist in the
15   implementation of, and maintain standards for a system of
16   transmitting data from the department to all insurance producers
17   and insurers doing business in this State. The system shall include
18   standards for the electronic delivery of data from service providers
19   to insurers for the issuance of automobile insurance policies. Data
20   submitted to insurers electronically in accordance with this section
21   by service providers for insurance producers must be accepted by
22   insurers for the issuance of automobile insurance policies in this
23   State. The working group must consider methods for the inclusion
24   of data specific to individual insurers. Nothing in this section
25   prohibits an insurer from requiring the execution of the insurer‟s
26   proprietary, printed automobile insurance application by the
27   applicant subsequent to the insurer‟s acceptance of data submitted
28   electronically by an insurance producer.
29      (D) The driver, vehicle, and related information delivered to
30   insurers and insurance producers in accordance with this article
31   must not be used for marketing, solicitation, or another purpose not
32   enumerated in this article. This information may be used for rating
33   and quoting automobile insurance policy premiums, for the
34   issuance of an automobile insurance policy, and for other purposes
35   enumerated under this article and Article 7 of this chapter.
36      (E) The Department of Motor Vehicles, with input form the
37   working group, shall promulgate regulations for administering and
38   enforcing this article.
39
40      Section 56-10-740. For each fiscal year, the department will
41   estimate the costs it will incur to provide electronic data services to
42   insurers and insurance producers doing business in this State, and
43   project the amount of funds available to the department for

     [380]                              4
 1   reimbursement from the EDS Insurance Fund for that fiscal year.
 2   If the department determines that the funds available for
 3   reimbursement exceed the estimated costs, then no transaction
 4   charges will be made by the department or any service provider to
 5   insurers and insurance producers for the electronic data services.
 6   If the department determines that the funds available for
 7   reimbursement are less than the estimated costs, then an
 8   appropriate transaction charge will be made by the department to
 9   insurers for the electronic data services to recoup the department‟s
10   estimated deficit. An outstanding balance remaining from the
11   collection of transaction charges must be deposited into the EDS
12   Insurance Fund at the end of the fiscal year for use in the next or
13   subsequent fiscal years. At anytime during a fiscal year, if the
14   department determines that the funds available from the EDS
15   Insurance Fund will not cover projected expenses for the
16   remainder of the fiscal year, then upon thirty days notice, the
17   department may establish or increase transaction charges to
18   insurers for the electronic data services. The department at
19   anytime may decrease transaction charges based on the
20   department‟s financial projections.
21
22      Section 56-10-750. All funds collected as provided in Section
23   38-73-470(B) must be directed to the director of the Department of
24   Motor Vehicles and must be placed on deposit with the State
25   Treasurer and held in a special fund to be known as the „EDS
26   Insurance Fund‟ to be used by the Department of Motor Vehicles
27   as provided for in this article.
28
29      Section 56-10-755. The Department of Motor Vehicles must
30   collect data and maintain statistics for each fiscal year with regard
31   to electronic data services and the transmission or delivery of
32   driver, vehicle, and other related data to the insurance industry
33   including fees collected and placed in the EDS Insurance Fund,
34   reimbursements to the department from the EDS Insurance Fund,
35   expenditures related to service providers under contract with the
36   department fees collected from insurers for which the department
37   received no reimbursement, and the net funds available in the EDS
38   Insurance Fund at the end of the fiscal year. The Department of
39   Motor Vehicles must provide an annual report to the General
40   Assembly and the Department of Insurance containing the
41   information required in this section.
42


     [380]                             5
1   Section 56-10-760. This article shall not supercede other actions
2 by the department to transmit or deliver data in accordance with
3 the purpose of this chapter.”
4
5 SECTION 5. This act takes effect upon approval by the Governor.
6                               ----XX----
7




   [380]                           6