Senate Bill No. 653
(By Senator Bailey)
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[Introduced February 22, 1999;
referred to the Committee on Transportation.]
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A BILL to amend article twelve, chapter thirty-three of the code
of West Virginia, one thousand nine hundred thirty-one, as
amended, by adding thereto a new section, designated section
thirty-three, relating to providing limited agent licenses
for rental companies.
Be it enacted by the Legislature of West Virginia:
That article twelve, chapter thirty-three of the code of
West Virginia, one thousand nine hundred thirty-one, as amended,
be amended by adding thereto a new section, designated thirty- three, to read as follows:
ARTICLE 12. AGENTS, BROKERS, SOLICITORS AND EXCESS LINE.
§33-12-33. Limited license for rental companies.
(a) Purpose. This section is intended solely to clarify
chapter thirty-three by creating a limited license for car rental
companies.
(b) Definitions. As used in this section:
(1) "Authorized insurer" means an insurer that is licensed
by the commissioner to transact insurance in West Virginia.
(2) "Limited license" means the authorization by the
commissioner for a person or entity to sell certain coverages
relating to the rental of vehicles on behalf of an authorized
insurer pursuant to the provisions of this section.
(3) "Rental agreement" means any written agreement setting
forth the terms and conditions governing the use of a vehicle
provided by the rental company for rental or lease.
(4) "Rental company" means any person or entity in the
business of providing primarily private passenger vehicles to the
public under a rental agreement for a period not to exceed ninety
days.
(5) "Renter" means any person obtaining the use of a vehicle
from a rental company under the terms of a rental agreement for
a period not to exceed ninety days.
(6) "Vehicle" or "rental vehicle" means a motor vehicle of the private passenger type including passenger vans, minivans and
sport utility vehicles and of the cargo type, including cargo
vans, pick-up trucks and trucks with a gross vehicle weight of
less than twenty-six thousand pounds and which do not require the
operator to possess a commercial driver's license.
(7) "Rental period" means the term of the rental agreement.
(c) The commissioner may issue to a rental company that has
complied with the requirements of this section, a limited license
authorizing the limited licensee to offer or sell insurance
issued by an authorized insurer in connection with the rental of
vehicles.
(d) As a prerequisite for issuance of a limited license
under this section, there shall be filed with the commissioner a
written application for a limited license, signed by an officer
of the applicant, in such form or forms and supplements thereto,
and containing such information, as the commissioner may
prescribe.
(e) In the event that any provision of this section is
violated by a limited licensee, the commissioner may:
(1) After notice and a hearing, revoke or suspend a limited
license issued under this section in accordance with the provisions of section thirteen, article two of this chapter, or
(2) After notice and hearing, impose such other penalties,
including suspending the transaction of insurance at specific
rental locations where violations of this section have occurred,
as the commissioner deems to be necessary or convenient to carry
out the purposes of this section.
(f) The rental company licensed pursuant to subsection (b)
of this section may offer or sell insurance only in connection
with and incidental to the rental vehicles, whether at the rental
office or by preselection of coverage in a master, corporate,
group rental or individual agreements in any of the following
general categories:
(1) Personal accident insurance covering the risks of
travel, including, but not limited to, accident and health
insurance that provides coverage, as applicable, to renters and
other rental vehicle occupants for accidental death or
dismemberment and reimbursement for medical expenses resulting
from an accident that occurs during the rental period; and
(2) Liability insurance (including uninsured and
underinsured motorist coverage whether offered separately or in
combination with other liability insurance) that provides coverage, as applicable, to renters and other authorize drivers
of rental vehicles for liability arising from the operation of
the rental vehicle; and
(3) Personal effects insurance that provides coverage,
applicable to renters and other vehicle occupants of the loss of,
or damage to, personal effects that occurs during the rental
period; and
(4) Roadside assistance and emergency sickness protection
programs; and
(5) Any other travel or auto-related coverage that a rental
company offers in connection with and incidental to the rental of
vehicles.
(g) No insurance may be issued by a limited licensee
pursuant to this section unless:
(1) The rental period of the rental agreement does not
exceed ninety consecutive days; and
(2) At every rental location where rental agreements are
executed, brochures or other written material are readily
available to the prospective renter that:
(A) Summarizes clearly and correctly, the material terms of
coverage offered to renters, including the identity of the insurer;
(B) Discloses that the coverage offered by the rental
company may provide a duplication of coverage already provided by
a renter's personal automobile insurance policy, homeowner's
insurance policy, personal liability insurance policy, or other
source of coverage.
(C) States that the purchase by the renter of the kinds of
coverage specified in this section is not required in order to
rent a vehicle; and
(D) Describes the process for filing a claim in the event
the renter elects to purchase coverage and in the event of a
claim.
(3) Evidence of coverage on the face of the rental agreement
is disclosed to every renter who elects to purchase such
coverage.
(h) A limited license issued under this section shall also
authorize any employee of the limited licensee to act
individually on behalf, and under the supervision, of the limited
licensee with respect to the kinds of coverage specified in this
section.
(i) Each rental company licensed pursuant to this section shall conduct a training program in which employees being trained
shall receive basic instruction about the kinds of coverage
specified in this section and offered for purchase by prospective
renters of rental vehicles: Provided, That employees engaged in
the sale of insurance in connection with the rental of vehicles
for a rental company which has obtained a limited license shall
not be subject to the requirements of this article.
(j) Notwithstanding any other provision of this section, or
any rule adopted by the commissioner, a limited licensee pursuant
to this section shall not be required to treat moneys collected
from renters purchasing such insurance when renting vehicles as
funds received in a fiduciary capacity, provided that the
chargers for coverage shall be itemized and be ancillary to a
rental transaction. The sale of insurance not in conjunction
with a rental transaction is not to be permitted.
(k) The rental company shall be appointed by the licensed
insurer or insurers for the sale of insurance in connection with
and incidental to the rental of vehicles. The rental company
shall maintain at each location a list of the names and addresses
of employees which are selling insurance. The rental company
shall pay to the insurance commissioner an annual fee of twenty-five dollars for each employee selling insurance.
(l) No limited licensee under this section shall advertise,
represent or otherwise hold itself or any of its employees out as
licensed insurers, insurance agents or insurance brokers.
NOTE: The purpose of this bill is to provide a limited
license for rental companies for the sale of insurance in
conjunction with the rental of automobiles.
This section is new; therefore, strike-throughs and
underscoring have been omitted.