HBA-TBM H.B. 718 77(R) BILL ANALYSIS Office of House Bill AnalysisH.B. 718 By: Chavez Insurance 3/15/2001 Introduced BACKGROUND AND PURPOSE Current law mandates that a person must show proof of motor vehicle liability insurance when applying to obtain or renew a driver's license, motor vehicle registration, or a safety inspection sticker. However, since a registration and an inspection sticker only have to be renewed annually, and a driver's license even less often, it is possible for a motorist to show proof of insurance at the time of application and then cancel his or her insurance policy rather than pay for the policy for a full year, and bypass the liability insurance requirement. Since most insurance companies issue a card to an insured motorist as proof of insurance, a motorist may have false evidence of being insured that is presentable and acceptable to a law enforcement officer. House Bill 718 provides for the creation of a motor vehicle liability insurance database that would serve as an informational resource for law enforcement officers, Department of Public Safety officials, or other authorized personnel to provide incontrovertible proof of insurance for a motorist. RULEMAKING AUTHORITY It is the opinion of the Office of House Bill Analysis that rulemaking authority is expressly delegated to the Department of Public Safety in SECTION 1 (Section 601.024, Government Code) of this bill. ANALYSIS House Bill 718 amends the Transportation Code to require the Department of Public Safety (DPS) to establish and maintain a motor vehicle liability insurance database (database) no later than September 1, 2002 that contains information about liability policies that have expired or been canceled. The bill requires DPS on request of a law enforcement agency or other person that DPS by rule determines has a legitimate need for the information to provide information about whether a specific policy has expired or been canceled. The bill requires DPS to adopt rules requiring motor vehicle insurers to provide information necessary to maintain the database. The bill creates the motor vehicle liability account in the general revenue fund for the purpose of maintaining the database. The bill requires the comptroller to collect an annual assessment that is imposed on each motor vehicle insurer at a rate of 50 cents for each policy of motor vehicle liability insurance issued, delivered, or renewed by the insurer to a resident of this state. EFFECTIVE DATE September 1, 2001.