S.B. 149 Enrolled

1

MOTOR VEHICLE LIABILITY POLICY
2 MINIMUM LIMITS
3 2008 GENERAL SESSION
4 STATE OF UTAH
5 Chief Sponsor: Sheldon L. Killpack
6 House Sponsor: Stephen H. Urquhart
7
8 LONG TITLE
9 General Description:
10 This bill modifies the Insurance Code by amending provisions relating to motor vehicle
11 liability coverage policy limits.
12 Highlighted Provisions:
13 This bill:
14 . amends the definition of owner's and operator's security to clarify that certain motor
15 vehicle insurance policies issued or renewed prior to January 1, 2009 satisfy the
16 owner's or operator's security requirement;
17 . increases the minimum policy limits for motor vehicle liability coverage; and
18 . makes technical changes.
19 Monies Appropriated in this Bill:
20 None
21 Other Special Clauses:
22 This bill takes effect on January 1, 2009.
23 This bill provides revisor instructions.
24 Utah Code Sections Affected:
25 AMENDS:
26 31A-22-304, as last amended by Laws of Utah 1993, Chapter 271
27 41-12a-103, as last amended by Laws of Utah 1993, Chapters 212 and 234
28 41-12a-306, as last amended by Laws of Utah 2004, Chapter 90
29 41-12a-405, as last amended by Laws of Utah 1991, Chapter 203

30
31 Be it enacted by the Legislature of the state of Utah:
32 Section 1. Section 31A-22-304 is amended to read:
33 31A-22-304. Motor vehicle liability policy minimum limits.
34 Policies containing motor vehicle liability coverage may not limit the insurer's liability
35 under that coverage below the following:
36 (1) (a) $25,000 because of liability for bodily injury to or death of one person, arising
37 out of the use of a motor vehicle in any one accident;
38 (b) subject to the limit for one person in Subsection (1)(a), in the amount of [$50,000]
39 $65,000 because of liability for bodily injury to or death of two or more persons arising out of
40 the use of a motor vehicle in any one accident; and
41 (c) in the amount of $15,000 because of liability for injury to, or destruction of,
42 property of others arising out of the use of a motor vehicle in any one accident; or
43 (2) [$65,000] $80,000 in any one accident whether arising from bodily injury to or the
44 death of others, or from destruction of, or damage to, the property of others.
45 Section 2. Section 41-12a-103 is amended to read:
46 41-12a-103. Definitions.
47 As used in this chapter:
48 (1) "Department" means the Department of Public Safety.
49 (2) "Judgment" means any judgment that is final by:
50 (a) expiration without appeal of the time within which an appeal might have been
51 perfected; or
52 (b) final affirmation on appeal, rendered by a court of competent jurisdiction of any
53 state or of the United States, upon a cause of action for damages:
54 (i) arising out of the ownership, maintenance, or use of any motor vehicle, including
55 damages for care and loss of services because of bodily injury to or death of any person, or
56 because of injury to or destruction of property including the loss of use of the property; or
57 (ii) on a settlement agreement.

58 (3) "License" or "license certificate" have the same meanings as under Section
59 53-3-102 .
60 (4) (a) "Motor vehicle" means every self-propelled vehicle that is designed for use upon
61 a highway, including trailers and semitrailers designed for use with other motorized vehicles.
62 (b) "Motor vehicle" does not include traction engines, road rollers, farm tractors,
63 tractor cranes, power shovels, and well drillers, and every vehicle that is propelled by electric
64 power obtained from overhead wires but not operated upon rails.
65 (5) "Nonresident" means every person who is not a resident of Utah.
66 (6) "Nonresident's operating privilege" means the privilege conferred upon a person
67 who is not a resident of Utah by the laws of Utah pertaining to the operation by him of a motor
68 vehicle, or the use of a motor vehicle owned by him, in Utah.
69 (7) "Operator" means every person who is in actual physical control of a motor vehicle.
70 (8) "Owner" means:
71 (a) a person who holds legal title to a motor vehicle;
72 (b) a lessee in possession;
73 (c) a conditional vendee or lessee if a motor vehicle is the subject of a conditional sale
74 or lease with the right of purchase upon performance of the conditions stated in the agreement
75 and with an immediate right of possession in the conditional vendee or lessee; or
76 (d) a mortgagor if a motor vehicle is the subject of a mortgage with the mortgagor
77 entitled to possession.
78 (9) "Owner's or operator's security," "owner's security," or "operator's security" means
79 any of the following:
80 (a) an insurance policy or combination of policies conforming to Section 31A-22-302 ,
81 which is issued by an insurer authorized to do business in Utah;
82 (b) an insurance policy or combination of policies issued or renewed prior to January 1,
83 2009 that:
84 (i) conformed to the minimum coverage limits of Section 31A-22-304 prior to the
85 effective date of this bill; and

86 (ii) conform to the current requirements other than the minimum coverage limits of
87 policies issued in accordance with Section 31A-22-302 ;
88 [(b)] (c) a surety bond issued by an insurer authorized to do a surety business in Utah in
89 which the surety is subject to the minimum coverage limits and other requirements of policies
90 conforming to Section 31A-22-302 , which names the department as a creditor under the bond
91 for the use of persons entitled to the proceeds of the bond;
92 [(c)] (d) a deposit with the state treasurer of cash or securities complying with Section
93 41-12a-406 ;
94 [(d)] (e) maintaining a certificate of self-funded coverage under Section 41-12a-407 ; or
95 [(e)] (f) a policy conforming to Section 31A-22-302 issued by the Risk Management
96 Fund created in Section 63A-4-201 .
97 (10) "Registration" means the issuance of the certificates and registration plates issued
98 under the laws of Utah pertaining to the registration of motor vehicles.
99 (11) "Self-insurance" has the same meaning as provided in Section 31A-1-301 .
100 Section 3. Section 41-12a-306 is amended to read:
101 41-12a-306. Claims adjustment by persons with owner's or operator's security
102 other than insurance.
103 (1) An owner or operator of a motor vehicle with respect to whom owner's or
104 operator's security is maintained by a means other than an insurance policy under Subsection
105 41-12a-103 (9)(a) or (b), shall refer all bodily injury claims against the owner's or operator's
106 security to an independent adjuster licensed under Title 31A, Chapter 26, Insurance Adjusters,
107 or to an attorney.
108 (2) Unless otherwise provided by contract, any motor vehicle claim adjustment expense
109 incurred by a person maintaining owner's or operator's security by a means other than an
110 insurance policy under Subsection 41-12a-103 (9)(a) or (b), shall be paid by the person who
111 maintains this type of owner's or operator's security.
112 (3) Owners and operators of motor vehicles maintaining owner or operator's security by
113 a means other than an insurance policy under Subsection 41-12a-103 (9)(a) or (b) are subject to

114 the claim adjustment provisions of Title 31A, Chapter 26, Part 3, Claim Practices, in connection
115 with claims against such persons which arise out of the ownership, maintenance, or use of a
116 motor vehicle.
117 (4) In addition to other penalties and remedies available for failure to abide by this
118 section, the department may require any person violating this section to maintain owner's or
119 operator's security only in the manner specified under Subsection 41-12a-103 (9)(a).
120 Section 4. Section 41-12a-405 is amended to read:
121 41-12a-405. Surety bond as proof of owner's or operator's security.
122 (1) Proof of owner's or operator's security may be furnished by filing with the
123 department a copy of a surety bond, certified by the surety, which conforms to Subsection
124 41-12a-103 (9)[(b)](c). The bond may not be canceled except after ten days' written notice to
125 the department.
126 (2) If a judgment rendered against the principal within the coverage of the bond is not
127 satisfied within 60 days after judgment becomes final, the judgment creditor may, for his own
128 use and benefit and at his sole expense, bring an action in the name of the department against
129 the surety executing the bond.
130 Section 5. Effective date.
131 This bill takes effect on January 1, 2009.
132 Section 6. Revisor instructions.
133 It is the intent of the Legislature, that in preparing the Utah Code database for
134 publication, the Office of Legislative Research and General Counsel shall replace the reference
135 in Subsection 41-12a-103 (9)(b)(i) from "this bill" to the bill's designated chapter number in the
136 Laws of Utah.