H. B. 2204


(By Delegate Doyle)
[Introduced Janaury 14, 1999; referred to the
Committee on Banking and Insurance then the Judiciary.]




A BILL to amend and reenact section twelve, article four, chapter seventeen-d of the code of West Virginia, one thousand nine hundred thirty-one, as amended; and to amend and reenact section thirty-one, article six, chapter thirty-three of said code, all relating to motor vehicle liability insurance policies and removing the family purpose doctrine provision.

Be it enacted by the Legislature of West Virginia:
That section twelve, article four, chapter seventeen-d of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted; and that section thirty-one, article six, chapter thirty-three of said code be amended and reenacted, all to read as follows:
CHAPTER 17D. MOTOR VEHICLE SAFETY RESPONSIBILITY LAW.

ARTICLE 4. PROOF OF FINANCIAL RESPONSIBILITY FOR THE FUTURE.

§17D-4-12. "Motor vehicle liability policy" defined; scope and provisions of policy.

(a) A "motor vehicle liability policy" as said term is used in this chapter means an "owner's policy" or an "operator's policy" of liability insurance certified as provided in section ten or section eleven of this article as proof of financial responsibility, and issued, except as otherwise provided in section eleven, by an insurance carrier duly authorized to transact business in this state, to or for the benefit of the person named therein in the policy as insured.
(b) Such The owner's policy of liability insurance:
(1) Shall designate by explicit description or by appropriate reference all vehicles with respect to which coverage is thereby to be granted; and
(2) Shall insure the person named therein and any other person, as insured, using any such vehicle or vehicles with the express or implied permission of such named insured, in the policy against loss from the liability imposed by law for damages arising out of the ownership, operation, maintenance or use of such the vehicle or vehicles within the United States of America or the Dominion of Canada, subject to limits exclusive of interest and costs, with respect to each such vehicle, as follows: Twenty thousand dollars because of bodily injury to or death of one person in any one accident and, subject to said the limit for one person, forty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and ten thousand dollars because of injury to or destruction of property of others in any one accident.
(c) Such The operator's policy of liability insurance shall insure the person named as insured therein in the policy against loss from the liability imposed upon him the person by law for damages arising out of the use by him the person of any motor vehicle not owned by him or her, within the same territorial limits and subject to the same limits of liability as are set forth above with respect to an owner's policy of liability insurance.
(d) Such The motor vehicle liability policy shall state the name and address of the named insured, the coverage afforded by the policy, the premium charged therefor for the policy, the policy period, and the limits of liability, and shall contain an agreement or be endorsed that insurance is provided thereunder under the policy in accordance with the coverage defined in this chapter as respects bodily injury and death or property damage, or both, and is subject to all the provisions of this chapter.
(e) Such The motor vehicle liability policy need not insure any liability under any workers' compensation law nor any liability on account of bodily injury to or death of an employee of the insured while engaged in the employment, other than domestic, of the insured, or while engaged in the operation, maintenance or repair of any such the vehicle nor any liability for damage to property owned by, rented to, in charge of or transported by the insured.
(f) Every motor vehicle liability policy shall be is subject to the following provisions which need not be contained therein in the policy:
(1) The liability of the insurance carrier with respect to the insurance required by this chapter shall become becomes absolute whenever injury or damage covered by said the motor vehicle liability policy occurs; said the policy may not be canceled or annulled as to such the liability by an agreement between the insurance carrier and the insured after the occurrence of the injury or damage; no statement made by the insured or on his the insured's behalf and no violation of said the policy shall defeat or void said defeats or voids the policy.
(2) The satisfaction by the insured of a judgment for such the injury or damage shall not be is not a condition precedent to the right or duty of the insurance carrier to make payment on account of such the injury or damage.
(3) The insurance carrier shall have has the right to settle any claim covered by the policy, and if such the settlement is made in good faith, the amount thereof shall be of the settlement is deductible from the limits of liability specified in subdivision (2), subsection (b) of this section.
(4) The policy, the written application therefor for the policy, if any, and any rider or endorsement which does not conflict with the provisions of this chapter shall constitute is the entire contract between the parties.
(g) Any policy which grants the coverage required for a motor vehicle liability policy may also grant any lawful coverage in excess of or in addition to the coverage specified for a motor vehicle liability policy and such the excess or additional coverage shall not be is not subject to the provisions of this chapter. With respect to a policy which grants such the excess or additional coverage, the term "motor vehicle liability policy" applies only to that part of the coverage which is required by this section.
(h) Any motor vehicle liability policy may provide that the insured shall reimburse reimburses the insurance carrier for any payment the insurance carrier would not have been obligated to make under the terms of the policy except for the provisions of this chapter.
(i) Any motor vehicle liability policy may provide for the prorating of the insurance thereunder under the policy with other valid and collectible insurance.
(j) The requirements for a motor vehicle liability policy may be fulfilled by the policies of one or more insurance carriers which policies together meet such the requirements.
(k) Any binder issued pending the issuance of a motor vehicle policy shall be deemed to fulfill fulfills the requirements for such a policy.
CHAPTER 33. INSURANCE.

ARTICLE 6. THE INSURANCE POLICY.

§33-6-31. Motor vehicle policy; omnibus clause; uninsured and underinsured motorists' coverage; conditions for recovery under endorsement; rights and liabilities of insurer.

(a) No policy or contract of bodily injury liability insurance, or of property damage liability insurance, covering liability arising from the ownership, maintenance or use of any motor vehicle, shall may be issued or delivered in this state to the owner of such the vehicle, or shall may be issued or delivered by any insurer licensed in this state upon any motor vehicle for which a certificate of title has been issued by the division of motor vehicles of this state, unless it shall contain contains a provision insuring the named insured and any other person, except a bailee for hire and any persons specifically excluded by any restrictive endorsement attached to the policy, responsible for the use of or using the motor vehicle with the consent, expressed or implied, of the named insured or his or her spouse against liability for death or bodily injury sustained or loss or damage occasioned within the coverage of the policy or contract as a result of negligence in the operation or use of such the vehicle by the named insured: or by such person Provided, That in any such the automobile liability insurance policy or contract, or endorsement thereto to the policy, if coverage resulting from the use of a nonowned automobile is conditioned upon the consent of the owner of such the motor vehicle, the word "owner" shall be construed to include includes the custodian of such the nonowned motor vehicles. Notwithstanding any other provision of this code, if the owner of a policy receives a notice of cancellation pursuant to article six-a of this chapter and the reason for the cancellation is a violation of law by a person insured under the policy, said the owner may by restrictive endorsement specifically exclude the person who violated the law and the restrictive endorsement shall be is effective in regard to the total liability coverage provided under the policy, including coverage provided pursuant to the mandatory liability requirements of section two, article four, chapter seventeen-d of this code. but nothing in such restrictive endorsement shall be construed to abrogate the "family purpose doctrine"
(b) Nor shall may any such policy or contract be so issued or delivered unless it shall contain contains an endorsement or provisions undertaking to pay the insured all sums which he shall be the insured is legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle, within limits which shall be are no less than the requirements of section two, article four, chapter seventeen-d of this code, as amended from time to time: Provided, That such the policy or contract shall provide an option to the insured with appropriately adjusted premiums to pay the insured all sums which he shall be the insured is legally entitled to recover as damages from the owner or operator of an uninsured motor vehicle up to an amount of one hundred thousand dollars because of bodily injury to or death of one person in any one accident and, subject to said the limit for one person, in the amount of three hundred thousand dollars because of bodily injury to or death of two or more persons in any one accident and in the amount of fifty thousand dollars because of injury to or destruction of property of others in any one accident: Provided, however, That such the endorsement or provisions may exclude the first three hundred dollars of property damage resulting from the negligence of an uninsured motorist: Provided further, That such the policy or contract shall provide an option to the insured with appropriately adjusted premiums to pay the insured all sums which he shall the insured is legally be entitled to recover as damages from the owner or operator of an uninsured or underinsured motor vehicle up to an amount not less than limits of bodily injury liability insurance and property damage liability insurance purchased by the insured without setoff against the insured's policy or any other policy. Regardless of whether motor vehicle coverage is offered and provided to an insured through a multiple vehicle insurance policy or contract, or in separate single vehicle insurance policies or contracts, no insurer or insurance company providing a bargained for discount for multiple motor vehicles with respect to underinsured motor vehicle coverage shall may be treated differently from any other insurer or insurance company utilizing using a single insurance policy or contract for multiple covered vehicles for purposes of determining the total amount of coverage available to an insured. "Underinsured motor vehicle" means a motor vehicle with respect to the ownership, operation or use of which there is liability insurance applicable at the time of the accident, but the limits of that insurance are either: (i) Less than limits the insured carried for underinsured motorists' coverage; or (ii) has been reduced by payments to others injured in the accident to limits less than limits the insured carried for underinsured motorists' coverage. No sums payable as a result of underinsured motorists' coverage shall may be reduced by payments made under the insured's policy or any other policy.
(c) As used in this section, the term "bodily injury" shall include includes death resulting therefrom from the injury and the term "named insured" shall mean means the person named as such the insured in the declarations of the policy or contract and shall also include such person's spouse if a resident of the same household and the term "insured" shall mean the named insured and, while resident of the same household, the spouse of any such named insured and relatives of either, while in a motor vehicle or otherwise, and any person, except a bailee for hire, who uses, with the consent, expressed or implied, of the named insured, the motor vehicle to which the policy applies or the personal representative of any of the above the named insured; and the term "uninsured motor vehicle" shall mean means a motor vehicle as to which there is no: (i) Bodily injury liability insurance and property damage liability insurance both in the amounts specified by section two, article four, chapter seventeen-d of this code, as amended from time to time; or (ii) there is such insurance, but the insurance company writing the same insurance denies coverage thereunder under the insurance; or (iii) there is no certificate of self-insurance issued in accordance with the provisions of said section. A motor vehicle shall be deemed to be is uninsured if the owner or operator thereof be of the vehicle is unknown: Provided, That recovery under the endorsement or provisions shall be is subject to the conditions hereinafter set forth.
(d) Any insured intending to rely on the coverage required by subsection (b) of this section shall, if any action be is instituted against the owner or operator of an uninsured or underinsured motor vehicle, cause a copy of the summons and a copy of the complaint to be served upon the insurance company issuing the policy, in the manner prescribed by law, as though such the insurance company were a named party defendant; such after being served the company shall thereafter have has the right to file pleadings and to take other action allowable by law in the name of the owner, or operator, or both, of the uninsured or underinsured motor vehicle or in its own name.
Nothing in this subsection shall prevent such prevents the owner or operator from employing counsel of his or her own choice and taking any action in his or her own interest in connection with such the proceeding.
(e) If the owner or operator of any motor vehicle which causes bodily injury or property damage to the insured be is unknown, the insured, or someone in his or her behalf, in order for the insured to recover under the uninsured motorist endorsement or provision, shall:
(i) Within twenty-four hours after the insured discover, and being physically able to report the occurrence of such the accident, the insured, or someone in his or her behalf, shall report the accident to a police, peace or to a judicial officer, unless the accident shall has already have been investigated by a police officer;
(ii) Notify the insurance company, within sixty days after such the accident, that the insured or his or her legal representative has a cause or causes of action arising out of such the accident for damages against a person or persons whose identity is unknown and setting forth the facts in support thereof; and, upon written request of the insurance company communicated to the insured not later than five days after receipt of such the statement, shall make available for inspection the motor vehicle which the insured was occupying at the time of the accident; and
(iii) Upon trial establish that the motor vehicle, which caused the bodily injury or property damage, whose operator is unknown, was a "hit and run" motor vehicle, meaning a motor vehicle which causes damage to the property of the insured arising out of physical contact of such motor vehicle therewith, or which causes bodily injury to the insured arising out of physical contact of such the motor vehicle with the insured or with a motor vehicle which the insured was occupying at the time of the accident. If the owner or operator of any motor vehicle causing bodily injury or property damage be is unknown, an action may be instituted against the unknown defendant as "John Doe", in the county in which the accident took place or in any other county in which such the action would be proper under the provisions of article one, chapter fifty-six of this code; service of process may be made by delivery of a copy of the complaint and summons or other pleadings to the clerk of the court in which the action is brought, and service upon the insurance company issuing the policy shall be made as prescribed by law as though such insurance company were a party defendant. The insurance company shall have has the right to file pleadings and take other action allowable by law in the name of John Doe.
(f) An insurer paying a claim under the endorsement or provisions required by subsection (b) of this section shall be subrogated to the rights of the insured to whom such the claim was paid against the person causing such the injury, death or damage to the extent that payment was made. The bringing of an action against the unknown owner or operator as John Doe or the conclusion of such an the action shall does not constitute a bar to the insured, if the identity of the owner or operator who caused the injury or damages complained of, becomes known, from bringing an action against the owner or operator theretofore proceeded against as John Doe. Any recovery against such the owner or operator shall be paid to the insurance company to the extent that such the insurance company shall have has paid the insured in the action brought against such the owner or operator as John Doe, except that such the insurance company shall pay its proportionate part of any reasonable costs and expenses incurred in connection therewith, including reasonable attorney's fees. Nothing in an endorsement or provision made under this subsection, nor any other provision of law, shall operate operates to prevent the joining, in an action against John Doe, of the owner or operator of the motor vehicle causing injury as a party defendant, and such the joinder is hereby specifically authorized.
(g) No such endorsement or provisions shall may contain any provision requiring arbitration of any claim arising under any such the endorsement or provision, nor may anything be required of the insured except the establishment of legal liability, nor shall is the insured be restricted or prevented in any manner from employing legal counsel or instituting legal proceedings.
(h) The provisions of subsections (a) and (b) of this section shall do not apply to any policy of insurance to the extent that it covers the liability of an employer to his or her employees under any workers' compensation law.
(i) The commissioner of insurance shall formulate and require the use of standard policy provisions for the insurance required by this section, but use of such the standard policy provisions may be waived by the commissioner in the circumstances set forth in section ten of this article.
(j) A motor vehicle shall be deemed to be is uninsured within the meaning of this section, if there has been a valid bodily injury or property damage liability policy issued upon such the vehicle, but which policy is uncollectible, in whole or in part, by reason of the insurance company issuing such the policy upon such the vehicle being insolvent or having been placed in receivership. The right of subrogation granted insurers under the provisions of subsection (f) of this section shall does not apply as against any person or persons who is or becomes an uninsured motorist for the reasons set forth in this subsection.
(k) Nothing contained herein shall prevent in this section prevents any insurer from also offering benefits and limits other than those prescribed herein in this section, nor shall does this section be construed as preventing prevent any insurer from incorporating in such terms, conditions and exclusions as may be consistent with the premium charged.
(l) The insurance commissioner shall review on an annual basis the rate structure for uninsured and underinsured motorists' coverage as set forth in subsection (b) of this section. and shall report to the Legislature on said rate structure on or before the fifteenth day of January, one thousand nine hundred eighty-three, and on or before the fifteenth day of January of each of the next two succeeding years



NOTE: The purpose of this bill is to eliminate the family purpose doctrine.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.