S T A T E O F N E W Y O R K
________________________________________________________________________
9844
I N S E N A T E
June 4, 2024
___________
Introduced by Sen. BRESLIN -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the vehicle and traffic law, in relation to establishing
an online insurance verification system for motor vehicle insurance
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivisions 2, 3 and 4 of section 313 of the vehicle and
traffic law, subdivision 2 as amended by chapter 678 of the laws of
1997, paragraphs (a), (b) and (d) of subdivision 2 and subdivision 4 as
amended by chapter 509 of the laws of 1998, paragraph (b) of subdivision
4 as amended by chapter 161 of the laws of 2004, paragraph (d) of subdi-
vision 4 as further amended by section 104 of part A of chapter 62 of
the laws of 2011, subdivision 3 as amended by chapter 781 of the laws of
1983, are amended to read as follows:
2. (a) [Upon] EXCEPT AS OTHERWISE PROVIDED IN SECTIONS THREE HUNDRED
TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE, the termination of
an owner's policy of liability insurance, other than an owner's policy
of liability insurance for a motorcycle, at the request of the insured
or by cancellation by the insurer, the insurer shall file a notice of
termination with reference to such policy, as opposed to any insured
vehicle or vehicles under such policy, with the commissioner not later
than thirty days following the effective date of such cancellation or
other termination, in accordance with the regulations required by para-
graph (c) of this subdivision. An insurer shall not file a notice of
termination with the commissioner except as required by this subdivi-
sion.
(b) [Upon] EXCEPT AS OTHERWISE PROVIDED IN SECTIONS THREE HUNDRED
TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE, UPON the issuance
of an owner's policy of liability insurance the insurer shall file a
notice or confirmation of issuance with reference to such policy not
later than fourteen days following the effective date of such issuance,
and not later than seven days following the effective date for policies
issued after January first, two thousand one, in accordance with the
regulations required by paragraph (c) of this subdivision.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD10946-06-4
S. 9844 2
(c) The commissioner shall promulgate regulations establishing proce-
dures for issuance of proof of insurance and, EXCEPT AS OTHERWISE
PROVIDED IN SECTIONS THREE HUNDRED TWELVE-B AND THREE HUNDRED TWELVE-C
OF THIS ARTICLE, for reporting by insurers of notices of termination and
policy issuance, either electronically or by paper copy, at the option
of the department. Such reporting OR, IF REQUIRED PURSUANT TO SECTIONS
THREE HUNDRED TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE, SUCH
ONLINE VERIFICATION shall be required for every cancellation or termi-
nation which is effective on or after July first, nineteen hundred
eighty-four and for every policy issuance which is effective on or after
January first, two thousand[; provided, however, that should the commis-
sioner find, after testing of reporting procedures, that it would be
feasible to require reporting for policy cancellations, terminations or
issuances effective on an earlier date, he may by regulation so require
reporting on such earlier date, but in no event shall reporting be
required for cancellations or terminations effective prior to February
first, nineteen hundred eighty-four nor for policy issuances effective
prior to September first, nineteen hundred ninety-nine. Insurers shall
cooperate fully with the commissioner in any such testing of reporting
procedures].
(d) Upon application by an insurer, the commissioner may extend the
period for filing of notices of termination by such insurer PURSUANT TO
PARAGRAPH (C) OF THIS SUBDIVISION for up to fifteen days, and for seven
days for policies issued by an insurer. Extensions shall not be granted
unless the insurer demonstrates to the satisfaction of the commissioner
that compliance with the notice period would result in substantial hard-
ship to the insurer. The commissioner shall maintain a list of exten-
sions granted pursuant to this paragraph.
(E) NOTWITHSTANDING THE PROVISIONS OF PARAGRAPHS (B), (C) AND (D) OF
THIS SUBDIVISION, THE COMMISSIONER MAY, IN LIEU OF PROMULGATING REGU-
LATIONS FOR REPORTING BY INSURERS TO THE DEPARTMENT OF NOTICES OF TERMI-
NATION AND POLICY ISSUANCE EITHER ELECTRONICALLY OR BY PAPER COPY PURSU-
ANT TO SUCH PARAGRAPHS, PROMULGATE REGULATIONS PURSUANT TO SECTIONS
THREE HUNDRED TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE ESTAB-
LISHING PROCEDURES FOR ONLINE VERIFICATION BY MOTOR VEHICLE INSURERS OF
MOTOR VEHICLE OWNERS' POLICIES OF LIABILITY INSURANCE TO THE DEPARTMENT.
3. A cancellation or termination for which notice is required to be
filed with the commissioner pursuant to subdivision two of this section
OR WHICH MUST BE VERIFIED ONLINE PURSUANT TO SECTIONS THREE HUNDRED
TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE shall not be effec-
tive with respect to persons other than the named insured and members of
the insured's household until the insurer has filed a notice thereof
with the commissioner OR VERIFIED SUCH CANCELLATION OR TERMINATION
ONLINE, AS APPLICABLE, or until another insurance policy covering the
same risk has been procured, except that a notice filed with the commis-
sioner, in the format prescribed by the commissioner, within the period
prescribed in subdivision two of this section, OR A VERIFICATION MADE
ONLINE IN COMPLIANCE WITH SECTIONS THREE HUNDRED TWELVE-B AND THREE
HUNDRED TWELVE-C OF THIS ARTICLE, shall be effective as of the date
certified therein, regardless of whether a suspension order is issued
pursuant to section three hundred eighteen of this article. A receipt
from the department stating that a notice of termination has been filed
shall be deemed conclusive evidence of such filing. An insurer shall
cooperate with the commissioner in attempting to identify persons not in
compliance with this article in cases where the information reported by
S. 9844 3
the insurer does not correspond with records maintained by the depart-
ment.
4. Notwithstanding any other provision of this article to the contra-
ry, the commissioner shall establish a [pilot] program to maintain an
up-to-date insured vehicle identification database to assist in identi-
fying uninsured motor vehicles. Such [databases] DATABASE shall be
implemented by the department pursuant to standards prescribed by the
commissioner or an agent designated by the commissioner which shall seek
technical assistance from affected insurers and the New York Automobile
Insurance Plan. This program shall utilize all information collected
pursuant to this section OR PURSUANT TO SECTIONS THREE HUNDRED TWELVE-B
AND THREE HUNDRED TWELVE-C OF THIS ARTICLE and shall also include the
following elements:
(a) In addition to and in conjunction with EITHER the provisions of
subdivision two of this section OR THE PROVISIONS OF SECTIONS THREE
HUNDRED TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE, insurers
that write private passenger or commercial motor vehicle insurance in
this state shall also submit to the department, either electronically
[or], by paper copy OR, IF ESTABLISHED PURSUANT TO THE PROVISIONS OF
SECTION THREE HUNDRED TWELVE-B OF THIS ARTICLE, BY ONLINE VERIFICATION,
at the option of the department, information that identifies those poli-
cies that have been cancelled, terminated or non-renewed and all poli-
cies that have been issued, the date when such insurance lapses, and any
other information that the commissioner deems necessary to efficiently
identify and track uninsured vehicles in this state such as a
policyholder's address, policy number, vehicle registration number, and
vehicle identification number. The department may exempt from such
[pilot] program the transfer of information on certain classifications
of vehicles that are in the opinion of the department generally insured
and which it is difficult to identify uninsured vehicles within such
classification, such as large commercial vehicle fleets;
(b) [The] EXCEPT AS OTHERWISE PROVIDED IN SECTION THREE HUNDRED
TWELVE-B OF THIS ARTICLE, THE department shall forward to each motor
vehicle insurer, at such times as deemed necessary and appropriate by
the commissioner, a listing of all the registrants the department has on
file as insured with that insurer. Such insurer shall then review the
listing within thirty days of receipt of the listing and report to the
department which of the registrants the insurer does not insure;
(c) The commissioner shall, in conjunction with the superintendent of
state police and local law enforcement officials formulate a means to
allow such database ESTABLISHED PURSUANT TO THIS SUBDIVISION to be easi-
ly accessible to on-duty law enforcement personnel in the performance of
their official duties for the purpose of verifying whether an operator
maintains proper insurance coverage and to increase compliance with the
motor vehicle financial security laws under this article and article
eight of this title;
(d) In developing the mechanism to electronically transfer information
to the department PURSUANT TO THIS SECTION OR, AT THE DEPARTMENT'S
OPTION, PURSUANT TO SECTIONS THREE HUNDRED TWELVE-B AND THREE HUNDRED
TWELVE-C OF THIS ARTICLE, the commissioner shall consult with the super-
intendent of financial services and insurers to adopt a standardized
system of organizing, recording and transferring such information so as
to minimize insurer administrative expenses. The commissioner shall to
the maximum extent possible utilize nationally recognized electronic
data information systems such as those developed by the American
S. 9844 4
National Standards Institute or the American Association of Motor Vehi-
cle Administrators;
(e)(1) Either simultaneously or after the up-dated database system has
been established, the commissioner shall develop a computer indicator
that can be imprinted on a vehicle registration sticker or on a sticker
to be affixed to the insured's license plate. Such indicator system
shall enable law enforcement personnel and other authorized persons when
acting in the course of their official duties to access the department's
database so that such persons can ascertain whether a vehicle is proper-
ly insured or not insured;
(2) Such computer indicator system shall enable authorized persons in
the performance of their official duties to access information such as
the registrant's name, vehicle identification number, name of insurer,
current status of insurance, vehicle registration number and other
information that the commissioner deems necessary to implement the
provisions of this section OR SECTION THREE HUNDRED TWELVE-B OF THIS
ARTICLE. The commissioner in developing such computer indicator system
shall enable authorized persons in the performance of their official
duties to access only such information that is necessary to detect unin-
sured motor vehicles or accomplish other goals clearly established and
authorized by law. Such computer indicator system shall be designed to
protect the personal privacy interests of motorists;
(f) The commissioner shall maintain [an] THE insured vehicle database
system [that is accurate to within a period of fourteen days] ESTAB-
LISHED PURSUANT TO THIS SUBDIVISION and a computer indicator system
described in paragraph (e) of this subdivision [within twenty-four
months of the effective date of this subdivision and] THAT ARE ACCURATE
to within seven days [by January first, two thousand one. The commis-
sioner shall submit to the legislature a report within eighteen months
from the date this subdivision takes effect which outlines the progress
being made to implement such database and computer indicator system.
After such database and computer indicator system is established and put
into operation, the commissioner shall make recommendations to the
legislature to alter, minimize or eliminate the need for the issuance of
insurance identification cards, simplify the requirements to demonstrate
proof of financial security and certificate of insurance currently
required by this article, eliminate the requirement for production of
proof of financial security to accompany applications for registrations
or renewals thereof provided that such database indicates that the
registrant is insured, and the repeal or modification of section three
hundred twelve-a of this article. The commissioner shall also make
recommendations to the legislature to streamline and shorten the notice
termination requirements of subdivisions one, two and three of this
section and section three hundred eighteen of this article. Such report
shall be submitted to the legislature within twelve months from the date
such database and indicator system has been implemented];
(g) [To minimize the cost of this program, the commissioner, if he
deems it necessary and prudent, can initially limit the scope of this
project to a select number of vehicle classifications or insurers;
(h)] Notwithstanding any other provision of law, information obtained
by the department pursuant to this section AND SECTIONS THREE HUNDRED
TWELVE-B AND THREE HUNDRED TWELVE-C OF THIS ARTICLE shall not be
disclosed, used, sold, accessed, utilized in any manner or released by
the department to any person, corporation, or state and local agency,
except in response to a specific, individual request for such informa-
tion authorized pursuant to the federal driver's privacy protection act
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(18 U.S.C. 2721 et.seq.). The department shall institute measures to
ensure that only authorized persons are permitted to access such infor-
mation for the purposes specified by this section AND SECTION THREE
HUNDRED TWELVE-B OF THIS ARTICLE. Persons who knowingly release or
disclose information from such database for a purpose other than those
described as authorized by this section or to a person not entitled to
receive it shall be guilty of a misdemeanor for each such release or
disclosure[; and
(i) The commissioner may postpone implementation of such pilot data-
base and computer indicator system for a period of time not to exceed
eighteen months if he or she determines that the program is not ready
for implementation. Should the commissioner determine that such system
cannot be implemented during the eighteen months extension, then the
commissioner shall report to the legislature the reasons why such
program cannot be implemented and request that the law be amended to
delay its implementation date].
§ 2. The vehicle and traffic law is amended by adding a new section
312-b to read as follows:
§ 312-B. ONLINE INSURANCE VERIFICATION SYSTEM OF MOTOR VEHICLE INSUR-
ANCE. 1. THE COMMISSIONER MAY ESTABLISH A SYSTEM FOR THE ONLINE VERIFI-
CATION OF MOTOR VEHICLE OWNERS' POLICIES OF LIABILITY INSURANCE. INFOR-
MATION AVAILABLE IN THE ONLINE INSURANCE VERIFICATION SYSTEM SHALL BE
PROVIDED TO THE COMMISSIONER BY MOTOR VEHICLE INSURERS PURSUANT TO RULES
AND REGULATIONS PROMULGATED BY THE COMMISSIONER, IF THE COMMISSIONER
DETERMINES ESTABLISHMENT OF SUCH SYSTEM WOULD FURTHER THE PURPOSES OF
THIS ARTICLE AS SET FORTH IN SUBDIVISION TWO OF SECTION THREE HUNDRED
TEN OF THIS ARTICLE.
2. WHERE THE COMMISSIONER ESTABLISHES A SYSTEM FOR THE ONLINE VERIFI-
CATION OF OWNERS' POLICIES OF LIABILITY INSURANCE PURSUANT TO THIS
SECTION, THE COMMISSIONER SHALL VERIFY MOTOR VEHICLE OWNERS' POLICIES OF
LIABILITY INSURANCE AND MAINTAIN SUCH SYSTEM OF ONLINE VERIFICATION OF
OWNERS' POLICIES OF LIABILITY INSURANCE THAT IS ACCURATE TO WITHIN A
PERIOD OF NO LESS THAN SEVEN DAYS, AND SHALL DEVELOP, IMPLEMENT, AND
MAINTAIN SECURITY FEATURES TO PROTECT THE SECURITY, CONFIDENTIALITY, AND
INTEGRITY OF SUCH SYSTEM'S INFORMATION AND DATA AND PROVIDE SAFEGUARDS
NECESSARY OR APPROPRIATE TO PRECLUDE UNAUTHORIZED ACCESS TO SUCH INFOR-
MATION AND DATA.
3. THE ONLINE INSURANCE VERIFICATION SYSTEM SHALL, AT A MINIMUM, HAVE
THE ABILITY:
(A) FOR THE DEPARTMENT TO SEND REQUESTS TO MOTOR VEHICLE INSURERS FOR
VERIFICATION OF EVIDENCE OF A MOTOR VEHICLE OWNER'S POLICY OF LIABILITY
INSURANCE AS PRESCRIBED BY THIS CHAPTER VIA WEB SERVICES, THROUGH THE
INTERNET, OR A SIMILAR PROPRIETARY OR COMMON CARRIER ELECTRONIC SYSTEM,
AS WELL AS TO RECEIVE FROM MOTOR VEHICLE INSURERS VERIFICATION OF
EVIDENCE OF A MOTOR VEHICLE OWNER'S POLICY OF LIABILITY INSURANCE IN A
FORM AND MANNER AS DETERMINED BY THE COMMISSIONER;
(B) TO BE UTILIZED BY THE COMMISSIONER FOR VERIFICATION OF MANDATORY
MOTOR VEHICLE LIABILITY INSURANCE COVERAGE AS PRESCRIBED BY THIS CHAP-
TER;
(C) TO ENABLE THE COMMISSIONER TO MAKE INQUIRIES TO MOTOR VEHICLE
INSURERS FOR EVIDENCE OF MOTOR VEHICLE OWNERS' POLICIES OF LIABILITY
INSURANCE INCLUDING, BUT NOT LIMITED TO, POLICYHOLDERS' ADDRESSES, POLI-
CY NUMBERS, VEHICLE REGISTRATION NUMBERS, AND VEHICLE IDENTIFICATION
NUMBERS;
S. 9844 6
(D) TO RESPOND TO EACH REQUEST BY THE COMMISSIONER FOR MOTOR VEHICLE
LIABILITY INSURANCE INFORMATION WITHIN AN AMOUNT OF TIME DETERMINED BY
THE COMMISSIONER; AND
(E) TO RESPOND WITHIN THE TIME ESTABLISHED.
4. IF THE COMMISSIONER IMPLEMENTS AN ONLINE INSURANCE VERIFICATION
SYSTEM PURSUANT TO THIS SECTION, SUCH SYSTEM (A) SHALL NOT BE ACCESSIBLE
EXCEPT TO THE COMMISSIONER AND TO INSURERS TO THE EXTENT NECESSARY TO
COMPLY WITH THE PROVISIONS OF THIS SECTION AND SECTION THREE HUNDRED
TWELVE-C OF THIS ARTICLE, AND (B) SHALL UNDERGO AN APPROPRIATE TESTING
AND PILOT PERIOD OF NOT LESS THAN ONE YEAR AFTER WHICH, SHOULD THE
COMMISSIONER DETERMINE TO PROCEED WITH SUCH ONLINE INSURANCE VERIFICA-
TION SYSTEM, THE COMMISSIONER SHALL CERTIFY IN WRITING TO THE GOVERNOR,
THE TEMPORARY PRESIDENT OF THE SENATE, AND THE SPEAKER OF THE ASSEMBLY
THAT SUCH SYSTEM IS FULLY OPERATIONAL.
§ 3. The vehicle and traffic law is amended by adding a new section
312-c to read as follows:
§ 312-C. INSURER RESPONSIBILITIES FOR THE ONLINE INSURANCE VERIFICA-
TION SYSTEM. WHERE AN ONLINE INSURANCE VERIFICATION SYSTEM IS ESTAB-
LISHED PURSUANT TO SECTION THREE HUNDRED TWELVE-B OF THIS ARTICLE:
1. EVERY MOTOR VEHICLE INSURER SHALL PROVIDE THE COMMISSIONER WITH
ACCESS TO ITS MOTOR VEHICLE LIABILITY INSURANCE POLICY STATUS INFORMA-
TION AS PROVIDED BY, AND CONSISTENT WITH ANY TIME FRAMES ESTABLISHED BY,
ANY RULES AND REGULATIONS PROMULGATED BY THE COMMISSIONER; AND
2. EVERY INSURER THAT IS LICENSED TO ISSUE MOTOR VEHICLE INSURANCE
POLICIES OR IS AUTHORIZED TO DO BUSINESS IN THIS STATE SHALL COMPLY WITH
THIS SECTION AND SECTION THREE HUNDRED TWELVE-B OF THIS ARTICLE FOR
VERIFICATION OF EVIDENCE OF MOTOR VEHICLE LIABILITY INSURANCE FOR EVERY
VEHICLE INSURED BY THAT INSURER IN THIS STATE, AS REQUIRED BY THIS CHAP-
TER AND THE RULES AND REGULATIONS PROMULGATED BY THE COMMISSIONER THERE-
UNDER.
§ 4. Paragraph (d) of subdivision 3 of section 317 of the vehicle and
traffic law, as added by chapter 678 of the laws of 1997, is amended to
read as follows:
(d) To fully fund such [pilot] database system and bar code program
established pursuant to subdivision four of section three hundred thir-
teen of this article AND, WHERE ESTABLISHED PURSUANT TO SECTION THREE
HUNDRED TWELVE-B OF THIS ARTICLE, SUCH ONLINE INSURANCE VERIFICATION
SYSTEM, the commissioner shall utilize the following three sources of
revenue: (1) twenty-five percent of all civil penalties imposed upon
persons fined pursuant to paragraph (b) of subdivision one-a of section
three hundred eighteen of this article, (2) monies obtained from grants
that may be awarded to the commissioner from the motor vehicle theft and
insurance fraud prevention fund, and (3) pro rata assessments upon all
insurance carriers subject to the provisions of this section in propor-
tion to the premium estimates filed by such carriers.
§ 5. This act shall take effect on the one hundred twentieth day after
it shall have become a law. Effective immediately, the addition, amend-
ment and/or repeal of any rule or regulation necessary for the implemen-
tation of this act are authorized to be made and completed on or before
such effective date.
