COMMITTEE ON LEGISLATIVE RESEARCH
OVERSIGHT DIVISION
FISCAL NOTE
L.R. No.: 1644-01
Bill No.: SB 486
Subject: Insurance - Automobile; Motor Vehicles
Type: Original
Date: February 26, 2003
FISCAL SUMMARY
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on General Revenue Fund |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Insurance Dedicated | $14,700 | $0 | $0 |
| Total Estimated
Net Effect on Other State Funds |
$14,700 | $0 | $0 |
Numbers within parentheses: ( ) indicate costs or losses.
This fiscal note contains 3 pages.
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Total Estimated
Net Effect on All Federal Funds |
$0 | $0 | $0 |
| FUND AFFECTED | FY 2004 | FY 2005 | FY 2006 |
| Local Government | $0 | $0 | $0 |
ASSUMPTION
Officials from the Department of Revenue assume the proposal would have no fiscal impact on their organization.
Officials from the Department of Insurance (INS) state insurance companies will be required to file new policy forms to comply with this proposal. The INS assumes 294 insurance companies will be required to file new policy forms which have to be accompanied by a $50 filing fee per company per filing. INS estimates one time revenues of $14,700 will be deposited into the Insurance Dedicated Fund.
| FISCAL IMPACT - State Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| INSURANCE DEDICATED FUND | |||
| Income - Department of Insurance | |||
| Policy form filing fees | $14,700 | $0 | $0 |
| ESTIMATED NET EFFECT ON INSURANCE DEDICATED FUND |
$14,700 |
$0 |
$0 |
| FISCAL IMPACT - Local Government | FY 2004
(10 Mo.) |
FY 2005 | FY 2006 |
| $0 | $0 | $0 |
FISCAL IMPACT - Small Business
Small business insurance companies would be expected to be affected by the proposal.
DESCRIPTION
This proposal modifies the law regarding insurance coverage for loaned and demonstration vehicles. Under the current law, every motor vehicle liability insurance policy must provide liability coverage to loaned motor vehicles operated by the insured. Under this proposal, other types of coverages are extended to loaned motor vehicles. In addition to liability insurance policies, the following types of automobile insurance policies must extend coverage to loaned motor vehicles and such motor vehicle's occupants: 1) Principal damage insurance policies, 2) Uninsured and underinsured policies; and 3) Policies covering death or bodily injury.
The amount of coverage extended to the loan vehicle shall not exceed the amount of coverage provided for the motor vehicle being repaired or serviced. The coverage from such policies shall be primary.
This legislation is not federally mandated, would not duplicate any other program and would not require additional capital improvements or rental space.
SOURCES OF INFORMATION
Department of Revenue
Department of Insurance
Mickey Wilson, CPA
Director
February 26, 2003