STAND

STAND. COM. REP. NO.226

Honolulu, Hawaii

, 2003

RE: S.B. No. 1055

S.D. 1

Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committees on Commerce, Consumer Protection and Housing and Science, Art and Technology, to which was referred S.B. No. 1055 entitled:

"A BILL FOR AN ACT RELATING TO MOTOR VEHICLE INSURANCE,"

beg leave to report as follows:

The purpose of this measure is to require the insurance commissioner to develop and maintain a motor vehicle insurance database to receive electronic transmissions from insurers regarding motor vehicle insurance transactions, that is accessible by law enforcement for purposes of enforcing the motor vehicle insurance requirement.

The Honolulu Police Department (HPD), Accurate Information Systems, Inc., and two individuals supported the measure. The Insurance Division and the Department of Customer Services, City and County of Honolulu, supported the measure with amendments. State Farm Insurance Companies and the Hawaii Insurers Council opposed the measure.

Your Committees find that there continues to be a problem with motorists driving uninsured. In the five-year period between 1998 and 2000, the HPD issued almost 109,000 citations for insurance violations. Additionally, there continues to be a problem with the verification of insurance coverage. The HPD testified that police investigating a collision at the scene are sometimes presented with an insurance card, that is later determined to be invalid.

This measure requires the establishment of an electronic insurance database that permits the identification of insured and uninsured motor vehicles. Your Committees find that the database will allow law enforcement and the courts to instantaneously determine whether a vehicle involved in a traffic incident has insurance coverage. Additionally, the existence of such a system may discourage motorists from driving without insurance and increase compliance with the insurance laws.

Your Committees have amended this measure to:

(1) Require the City and County of Honolulu's Motor Vehicle and Licensing Division (DMV), rather than the State's Insurance Division, to establish and operate the insurance database;

(2) Require the insurance database to be interactive with the DMV's motor vehicle registration computer file which is currently used statewide for the registration of motor vehicles and for motor vehicle inquiries by law enforcement officers and the Judiciary;

(3) Require the input of only the subject vehicle's vehicle identification number (VIN), and not other information such as policy numbers and vehicle descriptions, into the database; and

(4) Appropriate $1 in general revenues.

In addition, your Committees made technical amendments to the measure for clarity and to delete irrelevant language.

As affirmed by the records of votes of the members of your Committees on Commerce, Consumer Protection and Housing and Science, Art and Technology that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 1055, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 1055, S.D. 1, and be referred to the Committee on Ways and Means.

Respectfully submitted on behalf of the members of the Committees on Commerce, Consumer Protection and Housing and Science, Art and Technology,

____________________________ DAVID Y. IGE, Chair		____________________________ RON MENOR, Chair