State SealARIZONA HOUSE OF REPRESENTATIVES


 

SB 1087: vehicle liability insurance; minimum limits

PRIME SPONSOR: Senator Brophy McGee, LD 28

BILL STATUS: Commerce

                               

 

Overview

☐ Prop 105 (45 votes)	     ☐ Prop 108 (40 votes)      ☐ Emergency (40 votes)	☐ Fiscal NoteIncreases the motor vehicle minimum liability coverage amounts.

History

A person operating a motor vehicle on a roadway is required to demonstrate an ability to respond to damages by providing proof of financial responsibility. Financial responsibility may be evidenced by an auto liability policy, a certificate of self-insurance or an alternate method of coverage (A.R.S. § 28- 4135).

An individual may purchase an auto liability policy from a licensed insurer. A.R.S. § 28-4009 establishes minimum coverage limits for auto liability policies, commonly referred to as 15/30/10 coverage:

1.       $15,000 for one person sustaining bodily injury or death in an accident;

2.       $30,000 for two or more persons sustaining bodily injury or death in an accident; and

3.       $10,000 for injury or damage to others' property in an accident.

According to the Insurance Information Institute, in 2015 the national percentage of uninsured motorists was 13%, and the percentage of uninsured motorists in Arizona was 12%.

Provisions

1.       Increases the motor vehicle minimum liability coverage limits for a policy that is issued or renewed, beginning July 1, 2020, as follows:

a.       $25,000 for one person sustaining bodily injury or death in an accident;

b.       $50,000 for two or more persons sustaining bodily injury or death in an accident; and

c.        $15,000 for injury to or destruction of property.

i.         Exempts certificates of self-insurance. (Sec. 2)

2.       Maintains current motor vehicle minimum coverage limits for a motor vehicle liability policy issued or renewed prior to July 1, 2020. (Sec. 2)

3.       Requires the offering of uninsured or underinsured motorist coverage must be made at the time of the application. (Sec. 1)

4.       Removes the requirement for an insurer to confirm the selection or rejection of uninsured or underinsured motorist coverage as a condition for satisfying the insurer's standard of care. (Sec. 1)

5.       Specifies that the uninsured or underinsured policy declarations page is valid for, extends to and covers all persons insured under the policy and must be sent to the named insured. (Sec. 1)

6.       Asserts the uninsured or underinsured policy declarations page, rather than the insured's selection or rejection of limits on a form approved by the director, constitutes the final expression of the named insured's decision to purchase or reject the coverage. (Sec. 1)

7.       Specifies an insurer does not need to reoffer uninsured or underinsured motorist coverage as a result of a change in the current minimum liability limits for bodily injury or death. (Sec. 1)

8.       Contains an applicability clause. (Sec. 3)

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12.   Fifty-fourth Legislature                       SB 1087

13.   First Regular Session                            Version 1: Commerce

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