Legislative Changes Affecting Personal Automobile Insurance

STATE OF MAINE DEPARTMENT OF PROFESSIONAL AND FINANCIAL REGULATION BUREAU OF INSURANCE 34 STATE HOUSE STATION AUGUSTA, MAINE 04333-0034 Janet T. Mills Governor Eric A. Cioppa Superintendent PRINTED ON RECYCLED PAPER O F F IC E S L O C A T ED A T 76 N O R T H ER N A V EN U E, G A R D IN ER, M A I N E 04345 www.maine.gov/insurance Phone: (207) 624-8475 TTY: Please call Maine Relay 711 Consumer Assistance: 1-800-300-5000 Fax (207) 624-8599 Bulletin 461 Legislative Changes Affecting Personal Automobile Insurance This Bulletin concerns two laws enacted during the First Special Session of the 130th Legislature related to personal automobile insurance in Maine. One requires additional information on automobile insurance cards; the other limits the use of out-of-state comparable motor vehicles in adjusting damage claims. An Act To Include Excluded Individuals on Insurance Cards1 Beginning January 1, 2022, personal automobile insurance identification cards required under the General Financial Responsibility law2 must list any individuals who are excluded from coverage under the corresponding auto policy. For policies in effect on January 1, 2022, insureds should receive cards that comply with the new law by that date. Current law allows insurers to exclude individuals from coverage when they have committed an act or acts that would provide grounds for policy cancellation or nonrenewal.3 Listing excluded drivers on insurance cards will help law enforcement determine whether a driver actually has the coverage that the financial responsibility law requires. The Bureau will propose an amendment to 02-031 C.M.R. 391, Motor Vehicle Insurance Identification Cards, to conform the rule to this change. An Act To Improve Fairness in Auto Insurance Claims4 Effective October 18, 2021, insurers will need to adhere to a new provision5 governing the valuation of motor vehicles. Specifically, when an insurer uses comparable vehicles to value a damaged motor vehicle it may use only vehicles in Maine, New Hampshire, Vermont, Massachusetts, Connecticut, Rhode Island, or New York if comparable vehicles are available in those states. If the insurer determines that comparable vehicles are not available in those states, it 1 P.L. 2021, c. 200, An Act To Include Excluded Individuals on Insurance Cards (L.D. 1011). 2 29-A M.R.S. §§ 1601 – 1612. 3 24-A M.R.S. § 2916-B. 4 P.L. 2021, c. 283, An Act To Improve Fairness in Auto Insurance Claims (L.D. 1176). 5 24-A M.R.S. § 2910-B. - 2 - may expand its search. If they do not already follow this practice, insurers should adjust their claims procedures to limit their comparable vehicle searches to the region specified in the new law. Expanding the search beyond Maine should not be a first resort. Because people tend to look for replacement motor vehicles in their local area, insurers should start with Maine and then expand their search in the order listed in Section 1176. Claims files should document and justify the reason for expanding the search beyond Maine. September 13, 2021 Eric A. Cioppa Superintendent of Insurance NOTE: This Bulletin is intended solely for informational purposes. It is not intended to set forth legal rights, duties, or privileges, nor is it intended to provide legal advice. Readers should consult applicable statutes and rules and contact the Bureau of Insurance if additional information is needed.