S.B. 99 Enrolled

1

MOTOR VEHICLE INSURANCE - NAMED DRIVER
2 EXCLUSION AMENDMENTS
3 2011 GENERAL SESSION
4 STATE OF UTAH
5 Chief Sponsor: Lyle W. Hillyard
6 House Sponsor: Jack R. Draxler
7
8 LONG TITLE
9 General Description:
10 This bill modifies the Insurance Code by amending provisions relating to named driver
11 exclusions for motor vehicle insurance coverage.
12 Highlighted Provisions:
13 This bill:
14 . clarifies that if the driver license of a person excluded from coverage has been
15 denied, suspended, revoked, or disqualified and the person excluded from coverage
16 subsequently operates a motor vehicle, the exclusion shall proportionately reduce
17 any benefits to any named insured for benefits payable under uninsured motorist
18 coverage, underinsured motorist coverage, personal injury protection coverage, and
19 first party medical coverage to the extent the person excluded from coverage was
20 comparatively at fault; and
21 . makes technical changes.
22 Money Appropriated in this Bill:
23 None
24 Other Special Clauses:
25 None
26 Utah Code Sections Affected:
27 AMENDS:
28 31A-22-302.5, as enacted by Laws of Utah 2010, Chapter 172
29

30 Be it enacted by the Legislature of the state of Utah:
31 Section 1. Section 31A-22-302.5 is amended to read:
32 31A-22-302.5. Named driver exclusions.
33 (1) A policy of personal lines insurance or combination of personal lines policies
34 purchased to satisfy the owner's or operator's security requirement under Section 41-12a-301
35 may specifically exclude from coverage:
36 (a) a person who is a resident of the named insured's household, including a person
37 who usually makes the person's home in the same household but temporarily lives elsewhere;
38 or
39 (b) a person who usually or customarily operates the motor vehicle.
40 (2) The named driver exclusion under Subsection (1) is effective only if:
41 (a) at the time of the proposed exclusion, each person excluded from coverage satisfies
42 the owner's or operator's security requirement under Section 41-12a-301 , independently of the
43 named insured's proof of owner's or operator's security;
44 (b) any named insured and the person excluded from coverage each provide written
45 consent to the exclusion; and
46 (c) the insurer includes the name of each person excluded from coverage in the
47 evidence of insurance provided to an additional insured or loss payee.
48 (3) The provisions of Subsection (2)(a) do not apply to the named driver exclusion of
49 the person excluded from coverage if the person's driver license has been denied, suspended, or
50 revoked.
51 (4) The named driver exclusion shall remain effective until removed by the insurer.
52 (5) If the driver license of a person excluded from coverage under Subsection (1) has
53 been denied, suspended, revoked, or disqualified and the person excluded from coverage
54 subsequently operates a motor vehicle, the exclusion shall:
55 (a) exclude all liability coverage and all physical damage coverage without regard to
56 the comparative fault of the excluded driver;
57 (b) proportionately reduce any benefits otherwise payable to the person excluded from

58 coverage and to any named insured [under Subsection (2)(b)] for benefits payable under
59 uninsured motorist coverage, underinsured motorist coverage, personal injury protection
60 coverage, and first party medical coverage to the extent the person excluded from coverage was
61 comparatively at fault; and
62 (c) if the person excluded from coverage is 50% or more at fault in causing the
63 accident, bar both the excluded driver and any named insured [under Subsection (2)(b)] from
64 recovering any benefits under any coverage listed under Subsection (5)(b).
65 (6) The named driver exclusion under Subsection (1) does not apply when the person
66 excluded from coverage is:
67 (a) a non-driving passenger in a motor vehicle; or
68 (b) a pedestrian.