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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.


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