Reference Title: financial responsibility; motor carriers; general

AN ACT
AMENDING SECTIONS 20-259.01, 20-266, 28-448, 28-4001, 28-4007, 28-4031 AND 28-4032, ARIZONA REVISED STATUTES; REPEALING SECTION 28-4035, ARIZONA REVISED STATUTES; AMENDING SECTIONS 28-4072, 28-4073 AND 28-4074, ARIZONA REVISED STATUTES; TRANSFERRING AND RENUMBERING SECTIONS 28-4079 AND 28-4080, ARIZONA REVISED STATUTES, FOR PLACEMENT IN TITLE 28, CHAPTER 9, ARTICLE 1, ARIZONA REVISED STATUTES, AS SECTIONS 28-4009 AND 28-4010, RESPECTIVELY; AMENDING SECTIONS 28-4084, 28-4085, 28-4088, 28-4131, 28-4132, 28-4133 AND 28-4135, ARIZONA REVISED STATUTES; REPEALING SECTION 28-4136, ARIZONA REVISED STATUTES; AMENDING SECTIONS 28-4137, 28-4138, 28-4141, 28-4143, 28-4144, 28-4145, 28-4148, 28-4151 AND 28-4152, ARIZONA REVISED STATUTES; AMENDING SECTION 32-2393, ARIZONA REVISED STATUTES; RELATING TO VEHICLE INSURANCE AND FINANCIAL RESPONSIBILITY; PROVIDING FOR CONDITIONAL ENACTMENT.

Be it enacted by the Legislature of the State of Arizona:

Section 1. Section 20-259.01, Arizona Revised Statutes, is amended to read:

20-259.01 . Motor vehicle liability policy; uninsured optional; underinsured optional; subrogation; definitions

A. Every insurer writing automobile liability or motor vehicle liability policies shall make available to the named insured thereunder and by written notice offer the insured and at the request of the insured shall include within the policy uninsured motorist coverage which extends to and covers all persons insured under the policy, in limits not less than the liability limits for bodily injury or death contained within the policy. The selection of limits or rejection of coverage by a named insured or applicant on a form approved by the director shall be valid for all insureds under the policy. The offer need not be made in the event of the reinstatement of a lapsed policy or the transfer, substitution, modification or renewal of an existing policy. At the request of the insured, the insured may purchase and the insurer shall then include within the policy uninsured motorist coverage which extends to and covers all persons insured under the policy in any amount up to the liability limits for bodily injury or death contained within the policy but not less than the limits prescribed in section 28-4079 28-4009 .

B. Every insurer writing automobile liability or motor vehicle liability policies shall also make available to the named insured thereunder and shall by written notice offer the insured and at the request of the insured shall include within the policy underinsured motorist coverage which extends to and covers all persons insured under the policy, in limits not less than the liability limits for bodily injury or death contained within the policy. The selection of limits or rejection of coverage by a named insured or applicant on a form approved by the director shall be valid for all insureds under the policy. The offer need not be made in the event of the reinstatement of a lapsed policy or the transfer, substitution, modification or renewal of an existing policy. At the request of the insured the insured may purchase and the insurer shall then include within the policy underinsured motorist coverage which extends to and covers all persons insured under the policy in any amount authorized by the insured up to the liability limits for bodily injury or death contained within the policy.

C. Every insurer writing automobile liability or motor vehicle liability policies may make available the coverages required by subsections A and B of this section to owners and operators of motor vehicles which are used as public or livery conveyances or rented to others or which are used in the business primarily to transport property or equipment. The provisions of subsections A and B of this section shall not preclude an insurer writing automobile liability or motor vehicle liability policies in this state from requiring that all motor vehicles that are owned by or registered to the named insured and that are insured by the same insurer or group of insurers under a common management have the same limits of coverage for uninsured and underinsured motorist coverage in amounts as selected or rejected by the named insured.

D. "Uninsured motor vehicles", subject to the terms and conditions of that coverage, includes any insured motor vehicle if the liability insurer of the vehicle is unable to make payment on the liability of its insured, within the limits of the coverage, because of insolvency.

E. "Uninsured motorist coverage", subject to the terms and conditions of that coverage, means coverage for damages due to bodily injury or death if the motor vehicle that caused the bodily injury or death is not insured by a motor vehicle liability policy that contains at least the limits prescribed in section 28-4079 28-4009 . For the purposes of uninsured motorist coverage, an uninsured motorist does not include a person who is insured under a motor vehicle liability policy that complies with section 28-4079 28-4009 .

F. Any payment made under the bodily injury liability portion of a motor vehicle liability policy insuring the motor vehicle that caused the bodily injury or death in an amount equal to or less than the per person or per occurrence bodily injury limits of that policy, regardless of the number of persons receiving payments, precludes any payment under the uninsured motorist coverage based upon the fault of the person who is insured under the motor vehicle liability policy.

G. "Underinsured motorist coverage" includes coverage for a person if the sum of the limits of liability under all bodily injury or death liability bonds and liability insurance policies applicable at the time of the accident is less than the total damages for bodily injury or death resulting from the accident. To the extent that the total damages exceed the total applicable liability limits, the underinsured motorist coverage provided in subsection B of this section is applicable to the difference.

H. Uninsured and underinsured motorist coverages are separate and distinct and apply to different accident situations. Underinsured motorist coverage shall not provide coverage for a claim against an uninsured motorist in addition to any applicable uninsured motorist coverage. If multiple policies or coverages purchased by one insured on different vehicles apply to an accident or claim, the insurer may limit the coverage so that only one policy, selected by the insured, shall be applicable to any one accident.

I. Insurers who make payments for damages to insureds for uninsured motorist coverage may subrogate and sue for reimbursement of the total amount of said payments in the name of the insured against any uninsured motorist responsible for the damages to the insured.

J. Any common law prohibition against assignments of causes of action for personal injuries is abrogated to the extent provided in subsection I of this section.

K. An insurer is not required to offer, provide or make available coverage conforming to this section in connection with any general commercial liability policy, excess policy, umbrella policy or other policy that does not provide primary motor vehicle insurance for liabilities arising out of the ownership, maintenance, operation or use of a specifically insured motor vehicle.

Sec. 2. Section 20-266, Arizona Revised Statutes, is amended to read:

20-266 . Minimum liability policy; availability

An insurer writing or an agent or broker soliciting applications for motor vehicle liability policies that insure six or fewer motor vehicles shall make available a policy for the mandatory minimum motor vehicle liability limits as prescribed in section 28-4079 28-4009 if requested by a named insured or an applicant who meets the underwriting criteria of the insurer.

Sec. 3. Section 28-448, Arizona Revised Statutes, is amended to read:

28-448 . Notice of address or name change; address update; civil traffic violation

A. If a person's name or address changes after the person applies for or receives a driver license or nonoperating identification license or if a person's address changes after the person applies for or receives a vehicle registration or vehicle title, the person shall notify the department within ten days after the change of the old and new address or the former and new name and the following:

1. If a registration or title is applied for or received, the number of vehicles registered to the person and the vehicle identification numbers of the vehicles.

2. If a driver license or nonoperating identification license is applied for or received, the person's date of birth and the number of each license held by the person or a statement that each license is suspended, revoked or canceled.

B. A person may notify the department of an address change OR NAME CHANGE by telephone, in writing or in person and of a name change in person or in writing .

C. The department may update an address in a vehicle registration record or driver license record if a traffic citation received by the department or records of another consenting government agency indicate an address change after the date the address was stated in department records.

D. A violation of this section is a civil traffic violation.

Sec. 4. Section 28-4001, Arizona Revised Statutes, is amended to read:

28-4001 . Definitions

In this chapter, unless the context otherwise requires:

1. "Judgment" means a judgment that has become final by expiration without appeal of the time within which an appeal might have been perfected or by final affirmation on appeal and that is rendered by a court of competent jurisdiction of any state or of the United States on a cause of action either:

(a) Arising out of the ownership, maintenance or use of a motor vehicle for damages, including damages for care and loss of services, because of either bodily injury to or death of a person or injury to or destruction of property, including the loss of use of the property.

(b) On an agreement of settlement for damages described in subdivision (a) of this paragraph.

2. "License" means a license, temporary instruction permit or temporary license issued under the laws of this state pertaining to the licensing of persons to operate motor vehicles.

3. "MOTOR VEHICLE" MEANS A SELF-PROPELLED VEHICLE THAT IS REGISTERED OR REQUIRED TO BE REGISTERED UNDER THE LAWS OF THIS STATE.

3. 4. "Motor vehicle liability policy" means an owner's or an operator's policy of liability insurance that is both:

(a) Certified as provided in section 28-4077 or 28-4078 as proof of financial responsibility.

(b) Issued by an insurance carrier duly authorized to transact business in this state, to or for the benefit of the person named as the insured, except as otherwise provided in section 28-4078.

4. 5. "Nonresident operating privilege" means the privilege conferred on a nonresident by the laws of this state pertaining to the nonresident's operation of a motor vehicle or the use of a motor vehicle owned by the nonresident in this state.

5. 6. "Operator" means a person who is in actual physical control of a motor vehicle, whether or not the person has a license.

6. 7. "Proof of financial responsibility" means proof of ability to respond in damages for liability on account of accidents occurring after the effective date of the proof and arising out of the ownership, maintenance or use of a motor vehicle, in the following amounts: AMOUNTS REQUIRED BY SECTION 28-4009 OR 28-4033.

(a) Fifteen thousand dollars because of bodily injury to or death of one person in any one accident.

(b) Subject to the limit for one person, thirty thousand dollars because of bodily injury to or death of two or more persons in any one accident.

(c) Ten thousand dollars because of injury to or destruction of property of others in any one accident.

7. 8. "Registration" means the registration certificate or certificates and license plates issued under the laws of this state pertaining to the registration of motor vehicles.

8. 9. "State" means a state, territory or possession of the United States, the District of Columbia or a province of the Dominion of Canada.

Sec. 5. Section 28-4007, Arizona Revised Statutes, is amended to read:

28-4007 . Self-insurers

A. A person in whose name more than twenty-five motor vehicles are registered OR WHO IS REQUIRED TO COMPLY WITH THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN ARTICLE 2 OF THIS CHAPTER may qualify as a self-insurer by obtaining a certificate of self-insurance issued by the director as provided in this section.

B. On the person's application, the director may issue a certificate of self-insurance if the director is satisfied that the person is able and will continue to be able to pay judgments obtained against the person.

C. On not less than five days' notice and after a hearing, the director may cancel a certificate of self-insurance on reasonable grounds. Failure to pay a judgment within thirty days after the judgment becomes final is a reasonable ground for the cancellation of a certificate of self-insurance.

D. A PERSON WHO IS REQUIRED TO COMPLY WITH THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN ARTICLE 2 OF THIS CHAPTER MAY APPLY FOR PARTIAL SELF-INSURANCE TO COVER ANY PORTION OF THE FINANCIAL RESPONSIBILITY REQUIREMENTS.

Sec. 6. Section 28-4031, Arizona Revised Statutes, is amended to read:

28-4031 . Definitions

In this article, unless the context otherwise requires:

1. "Declared gross weight" has the meaning prescribed in section 28-5431. If a declaration has not been made, declared gross weight means gross weight.

2. "Gross weight" has the meaning prescribed in section 28-5431.

3. "Motor vehicle" means a self-propelled motor driven vehicle or vehicle combination used on a public highway.

4. 3. "Person" means an owner or operator of a motor vehicle or vehicle combination subject to the financial responsibility requirements of this article.

5. 4. "Public highway" means any way or place of whatever nature and of any kind that is used or open to the use by the public as a matter of right for the purpose of vehicular travel, including a highway under construction.

6. 5. "Vehicle combination" has the meaning prescribed in section 28-5431.

Sec. 7. Section 28-4032, Arizona Revised Statutes, is amended to read:

28-4032 . Persons subject to financial responsibility requirements

A. Notwithstanding any other statute:

1. A person who operates in the furtherance of a commercial enterprise in this state a motor vehicle or vehicle combination that has a declared gross weight of more than twenty thousand pounds shall comply with the financial responsibility requirements of this article AND ARTICLE 4 OF THIS CHAPTER .

2. A person who operates a motor vehicle or vehicle combination for the purpose of transporting hazardous materials, hazardous substances or hazardous wastes as defined by the department shall comply with the financial responsibility requirements of this article AND ARTICLE 4 OF THIS CHAPTER unless either ANY OF THE FOLLOWING APPLIES :

(a) The transportation of hazardous materials, hazardous substances or hazardous wastes is incidental to the principal purpose of the vehicular travel at the time the transportation occurs.

(b) The transportation of hazardous materials, hazardous substances or hazardous wastes is not in the furtherance of a commercial enterprise.

(c) The transportation of an amount of hazardous material listed in 49 Code of Federal Regulations section 172.504(a) table two is less than one thousand pounds or not more than one hundred ten gallons for a combustible liquid.

B. A person who operates a passenger-carrying motor vehicle, bus or van used to transport passengers for hire, other than a car pool operator, shall comply with the financial responsibility requirements of this article AND ARTICLE 4 OF THIS CHAPTER . For the purposes of this subsection, "car pool operator" means a natural person when engaged either regularly or occasionally in carrying one or more other persons by motor vehicle on a public highway, with or without compensation, if the carriage of the other person or persons is both:

1. Not for profit. A car pool operator is conclusively presumed not to be carrying persons for profit if either:

(a) The operator receives compensation of not more than twenty cents per mile for total vehicle miles traveled, except that the proportionate share of the car pool operator shall be included in the amount.

(b) The operator carries one or more of the operator's passengers in consideration of the operator being carried in like situations by the passenger or passengers. The receipt of compensation of more than twenty cents per mile for total vehicle miles traveled does not preclude a car pool operator from showing that this compensation does not result in a profit to the operator or that the operator did not intend that a profit result.

2. Incidental to another purpose of the car pool operator. Except in unusual circumstances, the carriage is incidental to another purpose of the operator if the operator is not making the trip solely for the purpose of carrying a passenger. A car pool operator is conclusively presumed not to be transporting passengers for hire.

Sec. 8. Repeal

Section 28-4035 , Arizona Revised Statutes, is repealed.

Sec. 9. Section 28-4072, Arizona Revised Statutes, is amended to read:

28-4072 . Nonpayment of judgments; suspension; exceptions

A. On receipt of a certified copy of a judgment, the director shall immediately suspend the license and registration and nonresident operating privilege of a person against whom the judgment was rendered, except as otherwise provided in this section and section 28-4075.

B. If the judgment creditor consents in writing on a form prescribed by the director that the judgment debtor be allowed the license and registration or the nonresident operating privilege and if the judgment debtor furnishes proof of financial responsibility, the director may allow the privileges for six months from the date of the consent and thereafter until the consent is revoked in writing, notwithstanding default in the payment of the judgment or of any installments prescribed in section 28-4075.

C. A person whose license, registration or nonresident operating privilege has been or is about to be suspended or shall become subject to suspension under this article may be relieved from the effect of the judgment as prescribed in this article by filing with the director all of the following:

1. An affidavit stating that at the time of the accident on which the judgment was rendered the affiant was insured, that the insurer is liable to pay the judgment and the reason, if known, why the insurance company has not paid the judgment.

2. The original or a certified copy of the policy of insurance, if available.

3. Other documents required by the director to show that the loss, injury or damage for which the judgment was rendered was covered by the policy of insurance.

D. If the director is satisfied from the papers filed pursuant to subsection C of this section that the insurer was authorized to issue the policy of insurance at the time and place of issuing the policy and that the insurer is liable to pay the judgment, at least to the extent and for the amounts required in this chapter, the director:

1. Shall not suspend the license, registration or nonresident operating privilege.

2. If the license, registration or nonresident operating privilege is already suspended, shall reinstate the license, registration or nonresident operating privilege.

Sec. 10. Section 28-4073, Arizona Revised Statutes, is amended to read:

28-4073 . Suspension length; reinstatement; designated fund

A. The license, registration and nonresident operating privilege shall remain suspended and the director shall not renew or issue a license or registration in the name of the person, including a person not previously licensed, until each judgment is satisfied in full or to the extent provided by this article CHAPTER or unless the judgment creditor failed to renew the judgment as provided in title 12, chapter 9, article 6 or the judgment is otherwise legally unenforceable and the person gives proof of financial responsibility subject to the exemptions stated in sections 28-4072 and 28-4075.

B. On receipt of an affidavit executed by a judgment debtor stating that a diligent search to locate the judgment creditor has been made and reciting with particularity the steps taken and that the judgment creditor or the successor in interest could not be found for the purpose of receiving payment of the judgment and on payment of the amount of the judgment to the department in a fund designated for that purpose, the director may reinstate the license, registration and nonresident operating privilege of the judgment debtor. The director shall hold the monies in trust for the purpose of satisfying the judgment. Monies deposited in the fund revert to the state general fund five years from the date of the deposit if not claimed by the judgment creditor.

C. Notwithstanding section 28-4088, a person whose license, registration or nonresident operating privilege is reinstated shall maintain proof of financial responsibility for two years after the judgment is satisfied.

Sec. 11. Section 28-4074, Arizona Revised Statutes, is amended to read:

28-4074 . Payments; satisfaction of judgments

A. For the purpose of this chapter only, a judgment referred to in this article is deemed satisfied on compliance with one of the following:

1. When fifteen thousand dollars is credited on a judgment or judgments rendered in excess of that amount because of bodily injury to or death of one person as the result of any one accident.

2. When, subject to the limit of fifteen thousand dollars because of bodily injury to or death of one person, thirty thousand dollars is credited on a judgment or judgments rendered in excess of that amount because of bodily injury to or death of two or more persons as the result of any one accident.

3. When ten thousand dollars is credited on a judgment or judgments rendered in excess of that amount because of injury to or destruction of property of others as a result of any one accident.

1. WHEN PAYMENT SUFFICIENT TO SATISFY THE LIMITS PRESCRIBED IN SECTION 28-4009 IS MADE.

2. IF HIGHER LIMITS ARE REQUIRED PURSUANT TO SECTION 28-4033, WHEN PAYMENT SUFFICIENT TO SATISFY THOSE LIMITS IS MADE.

B. Payments made in settlements of claims because of bodily injury, death or property damage arising from a motor vehicle accident shall be credited in reduction of the amounts provided for in this section.

Sec. 12. Transfer and renumber

Sections 28-4079 and 28-4080, Arizona Revised Statutes, are transferred and renumbered for placement in title 28, chapter 9, article 1, Arizona Revised Statutes, as sections 28-4009 and 28-4010, respectively.

Sec. 13. Section 28-4084, Arizona Revised Statutes, is amended to read:

28-4084 . Monies or certificates of deposit as proof; exception

A. The state treasurer may issue a certificate that gives evidence of proof of financial responsibility that the person named in the certificate has deposited with the state treasurer forty thousand dollars in cash or certificates of deposit with a value of forty thousand dollars issued by a financial institution.

B. The state treasurer shall not accept the deposit and issue a certificate for and the director shall not accept the certificate unless the depositor provides evidence that there are no unsatisfied judgments of any kind against the depositor in the county where the depositor resides.

C. The state treasurer shall hold the deposit to satisfy, in accordance with this chapter, an execution on a judgment issued against the person making the deposit for damages, including damages for care and loss of services, because of bodily injury to or death of a person or for damages because of injury to or destruction of property, including the loss of use of the property, resulting from the ownership, maintenance, use or operation of a motor vehicle after the deposit is made.

D. Monies or certificates of deposit deposited pursuant to this section are not subject to attachment or execution unless the attachment or execution arises out of a suit for damages described in subsection C.

E. DEPOSITS OF CASH OR CERTIFICATES OF DEPOSIT UNDER THIS SECTION DO NOT SATISFY THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN ARTICLE 2 OF THIS CHAPTER.

Sec. 14. Section 28-4085, Arizona Revised Statutes, is amended to read:

28-4085 . Proof by owner for others

A. If a person required to give proof of financial responsibility under this chapter is or later becomes either an operator in the employ of an owner or a member of the immediate family or household of an owner, the director shall accept proof given by the owner in lieu of proof by the other person to permit the other person to operate a motor vehicle for which the owner has given proof as provided by this chapter.

B. The director shall designate the restrictions imposed by this section on the face of the person's license.

Sec. 15. Section 28-4088, Arizona Revised Statutes, is amended to read:

28-4088 . Duration, cancellation and return of proof

A. On request, the director shall either:

1. Consent to the immediate cancellation of a certificate of insurance.

2. Direct and the state treasurer shall return to the person who is entitled monies or certificates of deposit deposited pursuant to this chapter as proof of financial responsibility.

3. Waive the requirement of filing proof under any of the following circumstances:

(a) At any time after three years from the date the proof was required . , if during the three year period preceding the request the director has not received a record of a conviction or a forfeiture of bail that would require or permit the suspension or revocation of the license, registration or nonresident operating privilege of the person by or for whom the proof was furnished.

(b) The death of the person on whose behalf the proof was filed or the permanent incapacity of the person to operate a motor vehicle.

(c) If the person who has given proof surrenders the person's license and registration to the director.

B. The director shall not consent to the return of monies or certificates of deposit if an action for damages on a liability covered by the proof is pending, if a judgment on that liability is unsatisfied or if the person who has deposited the monies or certificates of deposit has been involved as an operator or owner in a motor vehicle accident resulting in injury or damage to the person or property of others within one year immediately preceding the request. An affidavit of the applicant stating that these facts do not exist, that the applicant has been released from all of the applicant's liability or that the applicant has been finally adjudicated not liable for the injury or damage is sufficient evidence in the absence of evidence to the contrary in the records of the director.

C. If a person whose proof has been returned under subsection A, paragraph 3, subdivision (c) applies for a license or registration within three years from the date proof was originally required, the director shall refuse the application unless the applicant reestablishes the proof for the remainder of the three year period.

Sec. 16. Section 28-4131, Arizona Revised Statutes, is amended to read:

28-4131 . Definition of evidence

In this article, unless the context otherwise requires : ,

1. "evidence" includes:

(a) 1. An original, a photocopy or a copy of a current and valid:

(i) (a) Motor vehicle or automobile liability policy that meets the requirements of section 28-4079 28-4009 .

(ii) (b) Binder or certificate of motor vehicle or automobile liability insurance that meets the requirements of section 28-4079 28-4009 .

(iii) (c) Certificate of self-insurance issued by the department under article 1 of this chapter.

(iv) (d) Certificate of deposit that meets the requirements of section 28-4084.

(v) (e) Motor vehicle insurance identification card issued by an authorized insurer or an authorized agent of the insurer for a motor vehicle or automobile liability policy that meets the requirements of section 28-4079 28-4009 .

(f) CERTIFICATE OF INSURANCE FOR A POLICY THAT MEETS THE REQUIREMENTS OF SECTION 28-4033.

(b) 2. Designation of a motor vehicle as owned or leased by this state or any of its political subdivisions according to section 38-538.

2. "Motor vehicle" means a self-propelled vehicle that is registered or required to be registered under the laws of this state.

Sec. 17. Section 28-4132, Arizona Revised Statutes, is amended to read:

28-4132 . Financial responsibility requirement exemptions

This article does not apply to the owner or operator of a:

1. Farm tractor.

2. Trailer used solely in the operation of a farm for transporting the unprocessed fiber or forage products of a farm or an implement of husbandry designed primarily for or used in agricultural operations and only incidentally operated or moved on a highway.

3. Road-roller or road machinery, including a power sweeper, temporarily operating or moved on the highway.

4. Trailer not used for commercial purposes or semitrailer not used for commercial purposes.

5. Motor vehicle or vehicle combination subject to the financial responsibility requirements of article 2 of this chapter.

6. 5. Motor vehicle rented without a driver meeting the requirements of section 28-2166.

7. 6. Motor vehicle registered pursuant to section 28-2154.

8. 7. Motor vehicle owned by the United States government.

9. 8. Golf cart or any other motor vehicle used in the operation of a golf course or only incidentally operated or moved on a highway.

Sec. 18. Section 28-4133, Arizona Revised Statutes, is amended to read:

28-4133 . Insurance identification cards; documentary evidence; exception

A. An authorized insurer shall issue at least two motor vehicle insurance identification cards for a motor vehicle or automobile liability policy that meets the requirements of section 28-4079 28-4009 .

B. The card shall state that:

1. A person is required to possess evidence of financial responsibility within the motor vehicle.

2. The card meets the requirement.

3. The card is satisfactory evidence if the person is asked by the department of transportation to verify financial responsibility on the motor vehicle.

C. All documentary evidence issued by an insurer or an authorized agent of the insurer shall indicate:

1. The name of the insurer as listed with the department of insurance.

2. For the purpose of verifying insurance coverage, the mailing address and telephone number of the insurer or an authorized agent of the insurer.

3. In order to accurately verify insurance coverage, other information as required by the department of transportation.

4. If a binder is issued by an authorized agent of an insurer, the name, address and telephone number of the agent.

D. This section does not apply to a commercial vehicle policy that provides automatic coverage for additional or newly acquired vehicles until the policy's expiration date.

Sec. 19. Section 28-4135, Arizona Revised Statutes, is amended to read:

28-4135 . Motor vehicle financial responsibility requirement; civil penalties

A. A motor vehicle that is operated on a highway in this state shall be covered by one of the following:

1. A motor vehicle or automobile liability policy that provides limits not less than those prescribed in section 28-4079 28-4009 .

2. An alternate method of coverage as provided in section 28-4076.

3. A certificate of self-insurance as prescribed in section 28-4007.

4. A POLICY THAT SATISFIES THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN ARTICLE 2 OF THIS CHAPTER.

B. A PERSON OPERATING A MOTOR VEHICLE ON A HIGHWAY IN THIS STATE SHALL HAVE EVIDENCE WITHIN THE MOTOR VEHICLE OF CURRENT FINANCIAL RESPONSIBILITY APPLICABLE TO THE MOTOR VEHICLE.

C. FAILURE TO PRODUCE EVIDENCE OF FINANCIAL RESPONSIBILITY ON THE REQUEST OF A LAW ENFORCEMENT OFFICER INVESTIGATING A MOTOR VEHICLE ACCIDENT OR AN ALLEGED VIOLATION OF A MOTOR VEHICLE LAW OF THIS STATE OR A TRAFFIC ORDINANCE OF A CITY OR TOWN IS A CIVIL TRAFFIC VIOLATION THAT IS PUNISHABLE AS PRESCRIBED IN THIS SECTION.

D. A CITATION ISSUED FOR VIOLATING SUBSECTION B OR C OF THIS SECTION SHALL BE DISMISSED IF THE PERSON TO WHOM THE CITATION WAS ISSUED PRODUCES EVIDENCE TO THE APPROPRIATE COURT OFFICER ON OR BEFORE THE DATE AND TIME SPECIFIED ON THE CITATION FOR COURT APPEARANCE AND IN A MANNER SPECIFIED BY THE COURT, INCLUDING THE CERTIFICATION OF EVIDENCE BY MAIL, OF EITHER OF THE FOLLOWING:

1. THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN THIS SECTION WERE MET FOR THE MOTOR VEHICLE AT THE DATE AND TIME THE CITATION WAS ISSUED.

2. A MOTOR VEHICLE OR AUTOMOBILE LIABILITY POLICY THAT MEETS THE FINANCIAL RESPONSIBILITY REQUIREMENTS OF THIS STATE AND THAT INSURED THE PERSON AND THE MOTOR VEHICLE THE PERSON WAS OPERATING AT THE TIME THE PERSON RECEIVED THE CITATION REGARDLESS OF WHETHER OR NOT THE MOTOR VEHICLE WAS NAMED IN THE POLICY.

B. E. Notwithstanding section 28-1598 and except as provided in section 28-4137, a person who violates this section is subject to a civil penalty as follows:

1. The court may impose a minimum civil penalty of two hundred fifty dollars for the first violation and may direct the department to suspend the driver license of the person and the registration and license plates of the motor vehicle involved for three months.

2. If a person violates this section a second time within a period of thirty-six months, the court shall impose a minimum civil penalty of five hundred dollars and may direct the department to suspend the driver license of the person and the registration and license plates of the motor vehicle involved for six months.

3. If a person violates this section three or more times within a period of thirty-six months, the court shall impose a minimum civil penalty of seven hundred fifty dollars and direct the department to suspend the driver license and the registration and license plates of the motor vehicle involved for one year.

Sec. 20. Repeal

Section 28-4136 , Arizona Revised Statutes, is repealed.

Sec. 21. Section 28-4137, Arizona Revised Statutes, is amended to read:

28-4137 . Mitigation; rules

A. If a person subject to the civil penalty under section 28-4135 or 28-4136 :

1. Presents proof to the court that the person has purchased a six month policy of insurance that meets the requirements of section 28-4079 28-4009 , the court may reduce or waive the amount of the penalty.

2. Has not purchased insurance at the time of the person's scheduled court appearance but is willing to do so, the court may suspend the imposition of the civil penalty for up to thirty days to allow the person the opportunity to purchase the insurance.

B. The supreme court may adopt rules for the court as necessary to implement this section.

Sec. 22. Section 28-4138, Arizona Revised Statutes, is amended to read:

28-4138 . Charges of violations

A. A person may be charged for a violation of either section 28-4135 , SUBSECTION A or 28-4136 B , or both. Only one penalty shall be imposed against a person charged and found to have violated both sections arising out of the same series of acts.

B. Suspensions imposed pursuant to section 28-4135 or 28-4136 are in addition to any suspensions that may be imposed by the department pursuant to this article.

C. In imposing a civil penalty arising out of the same series of acts for which the department issued a suspension, the court may order a suspension issued pursuant to section 28-4135 or 28-4136 to run concurrently with any suspension ordered by the department.

Sec. 23. Section 28-4141, Arizona Revised Statutes, is amended to read:

28-4141 . Suspension of license, registration and license plates

A. On imposing a civil penalty for a violation of this article, the court may, if the violation is the first violation within a thirty-six month period, and shall, if the violation is a second or subsequent violation within a thirty-six month period, order the surrender of the person's driver license.

B. If a suspension is ordered, the court shall direct the department to suspend the driver license of the person and the registration and license plate of the motor vehicle involved for the time provided in section 28-4135 or 28-4136 .

Sec. 24. Section 28-4143, Arizona Revised Statutes, is amended to read:

28-4143 . Vehicle accident; financial responsibility verification; suspension

A. To ensure compliance with this article, the department may verify the financial responsibility of the owner of a motor vehicle involved in an accident in this state. If an accident involves an unregistered vehicle, the department may conduct a financial responsibility verification in the same manner as required for a registered vehicle.

B. If a motor vehicle is selected for financial responsibility verification under subsection A of this section, the department shall verify all insurance information on file for the requested vehicle by forwarding the information contained on the record to the insurer or the applicable party to determine if the insurance was in effect on the date of the accident.

C. On receipt of a denial from an insurer or any other applicable party or if no insurance information was on file, the department shall mail a notice to the owner requiring evidence from the owner that the motor vehicle met the financial responsibility requirement of section 28-4135 on the date of the accident. The notice shall require the owner to submit evidence of financial responsibility to the department within thirty days after the date the notice was mailed.

D. The department shall verify all evidence of financial responsibility submitted pursuant to subsection C of this section and shall take action as follows:

1. If the evidence of financial responsibility submitted by the owner indicates the existence of a motor vehicle or automobile liability policy covering the motor vehicle, the following steps shall be taken:

(a) The department shall forward the evidence document or the applicable information contained in the evidence document to the listed insurer or other appropriate party to determine whether the policy was valid on the date of the accident.

(b) The insurer or other appropriate party shall notify the department in writing within thirty days after the date the inquiry was mailed if the policy was not valid on the date indicated.

(c) On receipt of a letter of denial from an insurer or any other appropriate party, the department shall send to the owner a suspension notice that states:

(i) The insurer's denial of coverage on the date of the accident.

(ii) The owner's driver license and motor vehicle registration will be suspended fifteen days after the date the suspension notice was mailed unless the owner produces additional evidence to the department on or before the effective date of the suspension that the financial responsibility requirement of section 28-4135 was met for the vehicle on the date of the accident or unless the owner requests a hearing.

2. If the evidence of financial responsibility submitted by the owner indicates either self-insurance or a certificate of deposit, the department shall:

(a) Verify that the evidence is properly reflected in the department records.

(b) If it is determined that the evidence of financial responsibility is false or otherwise invalid, send a suspension notice to the owner that the person's driver license and motor vehicle registration will be suspended fifteen days after the date the suspension notice is mailed unless a hearing is requested.

3. If the person appearing as the registered owner of the vehicle according to department records is able to provide proof as prescribed by the director that the vehicle was sold before the date of the accident, the department shall not suspend the driver license or registration privilege of the person.

E. INFORMATION THAT IS BEING VERIFIED PURSUANT TO THIS SECTION IS A PUBLIC RECORD.

Sec. 25. Section 28-4144, Arizona Revised Statutes, is amended to read:

28-4144 . Notice; suspension; reinstatement fees

A. If the owner's response to a mailing pursuant to section 28-4143 indicates that the motor vehicle does not meet the financial responsibility requirement of section 28-4135, the department shall send a suspension notice to the owner that:

1. The motor vehicle does not meet the financial responsibility requirements.

2. The owner's driver license and motor vehicle registration will be suspended fifteen days after the date the suspension notice is mailed unless either:

(a) The owner produces additional evidence to the department on or before the effective date of the suspension that the financial responsibility requirement of section 28-4135 was met for the vehicle on the date of the accident.

(b) The owner requests a hearing.

B. If a response is not received within thirty days after the date the original notice requiring proof of financial responsibility is mailed, the department shall:

1. Send a suspension notice to the owner that the owner's driver license and motor vehicle registration or registration privilege will be suspended fifteen days after the date the suspension notice is mailed unless the owner submits evidence of financial responsibility or proof that the vehicle was sold pursuant to section 28-4143 before the effective date of the suspension.

2. If a response or evidence of financial responsibility or proof of vehicle sale pursuant to section 28-4143 is not received within the required time, suspend the motor vehicle registration or registration privilege, license plate and driver license.

3. If there is no other basis for the suspension and evidence of financial responsibility or evidence of vehicle sale is later submitted, verify the evidence of financial responsibility or sale pursuant to section 28-4143 and remove the suspension from the public record if financial responsibility is proven.

C. Except as provided in subsection B of this section, if the motor vehicle registration, registration privilege, license plate or driver license is suspended pursuant to section 28-4143 or this section:

1. The suspension is for a minimum of one year.

2. The department shall not terminate the suspension until the applicant both:

(a) Files with the department proof of financial responsibility in accordance with article 3 of this chapter.

(b) Pays to the department a ten dollar fee for the reinstatement of the driver license and a twenty-five dollar fee for the reinstatement of the motor vehicle registration and license plate, except that these fees do not apply to a suspension removed pursuant to subsection B of this section OR TO A SUSPENSION APPLICABLE TO A PERSON WHO IS REQUIRED TO COMPLY WITH THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN ARTICLE 2 OF THIS CHAPTER.

Sec. 26. Section 28-4145, Arizona Revised Statutes, is amended to read:

28-4145 . Restricted license and registration; rules

A. A person whose driver license, registration and license plate have been suspended pursuant to section 28-4143 or 28-4144 may apply to the department for a restricted license and registration. The license and registration are restricted to travel during the course of employment or between the person's place of employment and residence and their use is limited to specified periods of the day or night according to the person's employment schedule. The director shall prescribe by rule the criteria necessary for issuing a restricted license and registration. The department shall not grant an application for a restricted license and registration until the person meets the requirements of section 28-4135 28-4144, SUBSECTION C .

B. Notwithstanding section 28-4141, a person whose driver license, vehicle registration and license plate have been suspended on imposition of a civil penalty for a violation of this article or have been suspended by the department may apply to the department for a restricted license and registration. The license and registration are restricted to travel during the course of employment, between the person's place of employment and residence or between the person's place of residence and school, and are limited in use to specified periods of the day or night according to the requirements of the person's employment or school schedule. The department shall not grant the application for a restricted license and registration until the applicant files and maintains proof of financial responsibility with the department.

Sec. 27. Section 28-4148, Arizona Revised Statutes, is amended to read:

28-4148 . Notice of insurance cancellation or nonrenewal

A. Each insurer that cancels or becomes aware of the cancellation or nonrenewal of or failure to renew or of issuance of a motor vehicle liability insurance policy issued on a vehicle in this state shall provide to the department all cancellations, nonrenewals or new issues for any reason after thirty days have elapsed from the time of cancellation, nonrenewal or new issue of a policy.

B. The insurer shall provide the information by electronic media DATA INTERCHANGE in a format pursuant to a schedule specified by and in a manner prescribed by the director.

C. The department shall not require an insurer to specify the vehicle identification number of a vehicle covered under a commercial vehicle policy that provides automatic coverage for additional or newly acquired vehicles until the policy's expiration date.

D. The department shall provide the notice of cancellation or nonrenewal information to all law enforcement agencies on an on-line computerized call in basis from law enforcement vehicles.

E. On cancellation or nonrenewal of a policy, an insurer shall notify the insured that the department has been notified of the cancellation or nonrenewal and that the insured's motor vehicle registration may be suspended.

F. EXCEPT AS PROVIDED IN SECTION 28-4143, SUBSECTION E, information provided by an insurer to the department pursuant to this section shall be made available only to law enforcement agencies for law enforcement purposes.

Sec. 28. Section 28-4151, Arizona Revised Statutes, is amended to read:

28-4151 . Reinstatement fee; fund

A. A person shall pay a fee of not more than fifty dollars for the reinstatement of a motor vehicle registration and license plate as prescribed by the department for the purposes prescribed in this article. THIS FEE DOES NOT APPLY TO A PERSON WHO IS REQUIRED TO COMPLY WITH THE FINANCIAL RESPONSIBILITY REQUIREMENTS PRESCRIBED IN ARTICLE 2 OF THIS CHAPTER.

B. The director shall transmit the fees collected under this section to the state treasurer for deposit in the motor vehicle liability insurance enforcement fund established by subsection C.

C. A motor vehicle liability insurance enforcement fund is established consisting of monies received pursuant to this article. The department of transportation shall administer the fund.

Sec. 29. Section 28-4152, Arizona Revised Statutes, is amended to read:

28-4152 . Nonoperation of vehicle on highways of this state; exception; certification

A. A vehicle owner or lessee who does not operate a vehicle on a highway of this state is not required to meet the requirements of section 28-4135 during the period in which the vehicle is not in use if the requirements of subsections B through F of this section are met.

B. Within fifteen days after receipt of a notice from the department pursuant to section 28-4148, the vehicle owner or lessee shall do one of the following:

1. Comply with the requirements of section 28-4135 and provide proof of compliance in a manner prescribed by the director.

2. Certify to the department in a manner prescribed by the department all of the following:

(a) That the vehicle is nonoperational, will be placed in storage or will not be operated on a highway of this state.

(b) The reason the vehicle is not operated on a highway of this state.

(c) That the vehicle will not be operated on a highway of this state unless the financial responsibility requirements of section 28-4135 are met and unless proof of compliance is provided to the department pursuant to this section.

C. The certification prescribed in this section does not relieve a person of any registration fees or taxes imposed by the laws of this state.

D. The person shall annually certify to the department that the motor vehicle remains nonoperational, is in storage or is not operated on a highway of this state.

E. By certifying pursuant to subsection B, paragraph 2 of this section, the vehicle owner or lessee consents to the placement of an indicator on the computer records of the department that the vehicle is not registered for operation on a highway of this state until the insurer or vehicle owner meets the requirements of subsection F of this section.

F. The department shall not remove the indicator prescribed in subsection E of this section from the registration record until either of the following occurs:

1. An insurer that is licensed to transact business in this state notifies the department pursuant to section 28-4148 that the requirements of section 28-4079 28-4009 are met.

2. The department receives proof from the vehicle owner or lessee that the requirements of section 28-4135 are met.

G. On receiving notice from the court that a vehicle owner or lessee who made a certification pursuant to subsection B of this section has been convicted of a violation of section 28-4135 or 28-4136 , the owner or lessee is not eligible to certify pursuant to subsection B, paragraph 2 of this section for a one year period from the date of conviction.

Sec. 30. Section 32-2393, Arizona Revised Statutes, is amended to read:

32-2393 . Liability insurance required; amount

Notwithstanding section 28-4079 28-4009 , a school shall obtain an automobile liability or motor vehicle liability policy which covers each motor vehicle operated by the school for driver training in the minimum amount of one hundred fifty thousand dollars because of bodily injury to or death of one person in any one accident, subject to the limit for one person, three hundred thousand dollars because of bodily injury to or death of two or more persons in any one accident, fifty thousand dollars because of injury to or destruction of property of others in any one accident and five thousand dollars medical payments coverage.

Sec. 31. Conditional enactment

Because certain sections of this act amend sections of the Arizona Revised Statutes as amended or added by Senate Bill 1009 (title 28 rewrite; conforming legislation), this act is effective from and after December 31, 1997 only if Senate Bill 1009, forty-third legislature, first regular session, relating to transportation, is enacted into law.

APPROVED BY THE GOVERNOR APRIL 10, 1997.

FILED IN THE OFFICE OF THE SECRETARY OF STATE APRIL 10, 1997.