Insurer Reporting Requirements; List of Insurers Required To File Reports |
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Stephen R. Kratzke
National Highway Traffic Safety Administration
January 12, 2010
[Federal Register: January 12, 2010 (Volume 75, Number 7)]
[Rules and Regulations]
[Page 1548-1551]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr12ja10-13]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 544
[Docket No.: NHTSA-2009-0050]
RIN 2127-AK46
Insurer Reporting Requirements; List of Insurers Required To File
Reports
AGENCY: National Highway Traffic Safety Administration (NHTSA),
Department of Transportation (DOT).
ACTION: Final rule.
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SUMMARY: This final rule amends the Insurer Reporting Requirements. The
regulations specify the requirements for annual insurer reports and
lists in appendices those passenger motor vehicle insurers that are
required to file reports on their motor vehicle theft loss experiences.
An insurer included in any of these appendices must file three copies
of its report for the 2006 calendar year before October 25, 2009 as
specified by law, but we acknowledge this notice has not been published
by that date. Therefore, NHTSA will not take enforcement actions
against any insurer that file the 2006 insurer reports after October
25, 2009, but not later than December 31, 2009. This is a one-time
exception, based on the unique circumstances for 2009. All subsequent
reports must be filed not later than October 25th of the year in which
the reports are due. If the passenger motor vehicle insurers remain
listed, they must submit reports by each subsequent October 25th.
DATES: This final rule becomes effective on February 11, 2010. Insurers
listed in the appendices were required to submit reports on or before
December 31, 2009. If you wish to submit a petition for reconsideration
of this rule, your petition must be received by February 26, 2010.
ADDRESSES: Petitions for reconsideration should refer to the docket
number and be submitted to: Administrator, National Highway Traffic
Safety Administration, 1200 New Jersey Avenue, SE., West Building, Room
W41-307, Washington, DC 20590.
FOR FURTHER INFORMATION CONTACT: Carlita Ballard, Office of
International Policy, Fuel Economy and Consumer Programs, NHTSA, 1200
New Jersey Avenue, SE., West Building, Room W43-439, Washington, DC
20590, by electronic mail to carlita.ballard@dot.gov. Ms. Ballard's
telephone number is (202) 366-0846. Her fax number is (202) 493-2990.
SUPPLEMENTARY INFORMATION:
I. Background
Pursuant to 49 U.S.C. 33112, Insurer reports and information, NHTSA
requires certain passenger motor vehicle insurers to file an annual
report with the agency. Each insurer's report includes information
about thefts and recoveries of motor vehicles, the rating rules used by
the insurer to establish premiums for comprehensive coverage, the
actions taken by the insurer to reduce such premiums, and the actions
taken by the insurer to reduce or deter theft. Pursuant to 49 U.S.C.
Section 33112(f), the following insurers are subject to the reporting
requirements:
(1) Issuers of motor vehicle insurance policies whose total
premiums account for 1 percent or more of the total premiums of motor
vehicle insurance issued within the United States;
(2) issuers of motor vehicle insurance policies whose premiums
account for 10 percent or more of total premiums written within any one
state and;
(3) rental and leasing companies with a fleet of 20 or more
vehicles not covered by theft insurance policies issued by insurers of
motor vehicles, other than any governmental entity.
Pursuant to its statutory exemption authority, the agency exempted
certain passenger motor vehicle insurers from the reporting
requirements.
A. Small Insurers of Passenger Motor Vehicles
Section 33112(f)(2) provides that the agency shall exempt small
insurers of passenger motor vehicles if NHTSA finds that such
exemptions will not significantly affect the validity or usefulness of
the information in the reports, either nationally or on a state-by-
state basis. The term ``small insurer'' is defined, in Section
33112(f)(1)(A) and (B), as an insurer whose premiums for motor vehicle
insurance issued directly or through an affiliate, including pooling
arrangements established under state law or regulation for the issuance
of motor vehicle insurance, account for less than 1 percent of the
total premiums for all forms of motor vehicle insurance issued by
insurers within the United States. However, that section also
stipulates that if an insurance company satisfies this definition of a
``small insurer,'' but accounts for 10 percent or more of the total
premiums for all motor vehicle insurance issued in a particular state,
the insurer must report about its operations in that state.
In the final rule establishing the insurer reports requirement (49
CFR Part 544; 52 FR 59, 2 January 1987), NHTSA exercised its exemption
authority by listing in Appendix A each insurer that must report
because it had at least 1 percent of the motor vehicle insurance
premiums nationally. Listing the insurers subject to reporting, instead
of each insurer exempted from reporting because it had less than 1
percent of the premiums nationally, is administratively simpler, since
the former group is much smaller than the latter. In Appendix B, NHTSA
lists those insurers required to report for particular states because
each insurer had a 10 percent or greater market share of motor vehicle
premiums in those states. In the January 1987 final rule, the agency
stated that it would update Appendices A and B annually. NHTSA updates
the appendices based on data voluntarily provided by insurance
companies to A.M. Best, which A.M. Best \1\ publishes in its State/Line
Report each spring. The agency uses the data to determine the insurers'
market shares nationally and in each state.
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\1\ A.M. Best Company is a well-recognized source of insurance
company ratings and information. 49 U.S.C. 33112(i) authorizes NHTSA
to consult with public and private organizations as necessary.
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B. Self-Insured Rental and Leasing Companies
In addition, upon making certain determinations, NHTSA grants
exemptions to self-insurers, i.e., any person who has a fleet of 20 or
more motor vehicles (other than any governmental entity) used for
rental or lease whose vehicles are not covered by theft insurance
policies issued by insurers of passenger motor vehicles, 49 U.S.C.
33112(b)(1) and (f). Under 49 U.S.C. 33112(e)(1) and (2), NHTSA may
exempt a self-insurer from reporting, if the agency determines:
(1) The cost of preparing and furnishing such reports is excessive
in relation to the size of the business of the insurer;
(2) The insurer's report will not significantly contribute to
carrying out the purposes of Chapter 331.
In a final rule published June 22, 1990 (55 FR 25606), the agency
granted a
[[Page 1549]]
class exemption to all companies that rent or lease fewer than 50,000
vehicles, because it believed that the largest companies' reports
sufficiently represent the theft experience of rental and leasing
companies. NHTSA concluded that smaller rental and leasing companies'
reports do not significantly contribute to carrying out NHTSA's
statutory obligations and that exempting such companies will relieve an
unnecessary burden on them. As a result of the June 1990 final rule,
the agency added Appendix C, consisting of an annually updated list of
the self-insurers subject to Part 544. Following the same approach as
in Appendix A, NHTSA included, in Appendix C, each of the self-insurers
subject to reporting instead of the self-insurers which are exempted.
NHTSA updates Appendix C based primarily on information from Automotive
Fleet Magazine and Auto Rental News.\2\
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\2\ Automotive Fleet Magazine and Auto Rental News are
publications that provide information on the size of fleets and
market share of rental and leasing companies.
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C. When a Listed Insurer Must File a Report
Under Part 544, as long as an insurer is listed, it must file
reports on or before October 25 of each year. Thus, any insurer listed
in the appendices must file a report before October 25, 2009, and by
each succeeding October 25, absent an amendment removing the insurer's
name from the appendices.
II. Notice of Proposed Rulemaking
1. Insurers of Passenger Motor Vehicles
On August 17, 2009, NHTSA published a notice of proposed rulemaking
(NPRM) to update the list of insurers in Appendices A, B, and C
required to file reports (74 FR 41362). Appendix A lists insurers that
must report because each had 1 percent of the motor vehicle insurance
premiums on a national basis. The list was last amended in a final rule
published on August 18, 2008 (73 FR 48151). Based on the 2006 calendar
year market share data from A.M. Best, NHTSA proposed to remove Auto
Club Southern California Group and add Auto Club Enterprise Insurance
Group to Appendix A.
Appendix B lists insurers required to report because each insurer
had a 10 percent or greater market share of motor vehicle premiums in a
particular State. Based on the 2006 calendar year data for market
shares from A.M. Best, we proposed to remove Farm Bureau of Idaho from
Appendix B.
2. Rental and Leasing Companies
Appendix C lists rental and leasing companies required to file
reports. Subsequent to publishing the August 18, 2008 final rule (see
73 FR 48151), the agency was informed by Emkay, Inc., (Emkay) that it
was a motor vehicle leasing company offering financial, fleet
management and consulting services pertaining to operating a fleet of
motor vehicles and does not provide insurance policies for its
customers to purchase. However, Emkay, further stated that it does
include as a condition of its lease agreement that its lessees purchase
and maintain its own motor vehicle insurance coverage. Emkay also
submitted a copy of its lease agreement showing that insurance was
required as a condition of the lease. Therefore, NHTSA proposed to
remove Emkay, Inc. from the list of insurers required to meet the
reporting requirements.
Public Comments on Final Determination
Insurers of Passenger Motor Vehicles
The agency received no comments in response to the NPRM. Therefore,
this final rule adopts the proposed changes to Appendix A, B and C.
Accordingly, NHTSA has determined that each of the 19 insurers listed
in Appendix A, each of the eight insurers listed in Appendix B and each
of six companies listed in Appendix C are required to submit an insurer
report on its experience for calendar year 2006 no later than December
31, 2009, and set forth the information required by Part 544. As long
as these insurers and companies remain listed, they would be required
to submit reports in subsequent years.
Submission of Theft Loss Report
Passenger motor vehicle insurers listed in the appendices can
forward their theft loss reports to the agency in several ways:
a. Mail: Carlita Ballard, Office of International Policy, Fuel
Economy and Consumer Programs, Department of Transportation, NHTSA,
West Building, 1200 New Jersey Avenue, SE., NVS-131, Room W43-439,
Washington, DC 20590;
b. E-mail: carlita.ballard@dot.gov; or
c. Fax: (202) 493-2990.
Theft loss reports may also be submitted to the docket
electronically [identified by Docket No. NHTSA-2009-0050] by:
d. Logging onto the Federal eRulemaking Portal: Go to http://
www.regulations.gov. Follow the online instructions for filing the
document electronically.
Regulatory Impacts
1. Costs and Other Impacts
This notice has not been reviewed under Executive Order 12866,
Regulatory Planning and Review. NHTSA has considered the impact of this
final rule and determined that the action is not ``significant'' within
the meaning of the Department of Transportation's regulatory policies
and procedures. This final rule implements the agency's policy of
ensuring that all insurance companies that are statutorily eligible for
exemption from the insurer reporting requirements are in fact exempted
from those requirements. Only those companies that are not statutorily
eligible for an exemption are required to file reports.
NHTSA does not believe that this rule, reflecting current data,
affects the impacts described in the final regulatory evaluation
prepared for the final rule establishing Part 544 (52 FR 59; 2 January
1987). Accordingly, a separate regulatory evaluation has not been
prepared for this rulemaking action. Using the Bureau of Labor
Statistics Consumer Price Index for 2006 (see http://www.bls.gov/cpi),
the cost estimates in the 1987 final regulatory evaluation were
adjusted for inflation. The agency estimates that the cost of
compliance is $107,650 for any insurer added to Appendix A, $43,060 for
any insurer added to Appendix B, and $12,423 for any insurer added to
Appendix C. This final rule will remove one company and add one company
to Appendix A, remove one company for Appendix B, and remove one
company from appendix C. Therefore, the net effect of this final rule
is a decreased cost of $55,483 to insurers as a group.
Interested persons may wish to examine the 1987 final regulatory
evaluation. Copies of that evaluation were placed in Docket No. T86-01;
Notice 2. Any interested person may obtain a copy of this evaluation by
writing to NHTSA, Technical Reference Division, 1200 New Jersey Avenue,
SE., East Building (Ground Floor), Room E12-100, Washington, DC 20590,
or by calling (202) 366-2588.
2. Paperwork Reduction Act
The information collection requirements in this final rule were
submitted and approved by the Office of Management and Budget (OMB)
pursuant to the requirements of the Paperwork Reduction Act (44 U.S.C.
3501 et seq.). The existing information collection indicates that the
number of respondents for this collection is thirty-three, however, the
actual number of respondents fluctuate from year to year.
[[Page 1550]]
Therefore, because the number of respondents required to report for
this final rule does not exceed the number of respondents indicated in
the existing information collection, the agency does not believe that
an amendment to the existing information collection is necessary. This
collection of information is assigned OMB Control Number 2127-0547
(``Insurer Reporting Requirements'').
3. Regulatory Flexibility Act
The agency also considered the effects of this rulemaking under the
Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.). I certify that
this final rule will not have a significant economic impact on a
substantial number of small entities. The rationale for the
certification is that none of the companies listed on Appendices A, B
or C are construed to be a small entity within the definition of the
RFA. ``Small insurer'' is defined, in part under 49 U.S.C. 33112, as
any insurer whose premiums for all forms of motor vehicle insurance
account for less than 1 percent of the total premiums for all forms of
motor vehicle insurance issued by insurers within the United States, or
any insurer whose premiums within any State, account for less than 10
percent of the total premiums for all forms of motor vehicle insurance
issued by insurers within the State. This notice exempts all insurers
meeting those criteria. Any insurer too large to meet those criteria is
not a small entity. In addition, in this rulemaking, the agency exempts
all ``self insured rental and leasing companies'' that have fleets of
fewer than 50,000 vehicles. Any self-insured rental and leasing company
too large to meet that criterion is not a small entity.
4. Federalism
This action has been analyzed according to the principles and
criteria contained in Executive Order 12612, and it has been determined
that the final rule does not have sufficient federalism implications to
warrant the preparation of a Federalism Assessment.
5. Environmental Impacts
In accordance with the National Environmental Policy Act, NHTSA has
considered the environmental impacts of this final rule and determined
that it would not have a significant impact on the quality of the human
environment.
6. Civil Justice Reform
This final rule does not have any retroactive effect, and it does
not preempt any State law, 49 U.S.C. 33117 provides that judicial
review of this rule may be obtained pursuant to 49 U.S.C. 32909, and
section 32909 does not require submission of a petition for
reconsideration or other administrative proceedings before parties may
file suit in court.
7. Regulation Identifier Number (RIN)
The Department of Transportation assigns a regulation identifier
number (RIN) to each regulatory action listed in the Unified Agenda of
Federal Regulations. The Regulatory Information Service Center
publishes the Unified Agenda in April and October of each year. You may
use the RIN contained in the heading, at the beginning, of this
document to find this action in the Unified Agenda.
8. Plain Language
Executive Order 12866 requires each agency to write all rules in
plain language. Application of the principles of plain language
includes consideration of the following questions:
[ballot] Have we organized the material to suit the public's needs?
[ballot] Are the requirements in the proposal clearly stated?
[ballot] Does the proposal contain technical language or jargon
that is not clear?
[ballot] Would a different format (grouping and order of sections,
use of headings, paragraphing) make the rule easier to understand?
[ballot] Would more (but shorter) sections be better?
[ballot] Could we improve clarity by adding tables, lists, or
diagrams?
[ballot] What else could we do to make the proposal easier to
understand?
If you have any responses to these questions, you can forward them
to me several ways:
a. Mail: Carlita Ballard, Office of International Policy, Fuel
Economy and Consumer Programs, NHTSA, West Building, 1200 New Jersey
Avenue, SE., NVS-131, Room W43-439, Washington, DC 20590.
b. E-mail: carlita.ballard@dot.gov; or Fax: (202) 493-2990.
List of Subjects in 49 CFR Part 544
Crime insurance, Insurance, Insurance companies, Motor vehicles,
Reporting and recordkeeping requirements.
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In consideration of the foregoing, 49 CFR Part 544 is amended as
follows:
PART 544--[AMENDED]
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1. The authority citation for part 544 continues to read as follows:
Authority: 49 U.S.C. 33112; delegation of authority at 49 CFR
1.50.
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2. In Sec. 544.5, paragraph (a), the second sentence is revised to
read as follows:
Sec. 544.5 General requirements for reports.
(a) * * * This report shall contain the information required by
Sec. 544.6 of this part for the calendar year 3 years previous to the
year in which the report is filed (e.g., the report due by December 31,
2009 will contain the required information for the 2006 calendar year).
* * * * *
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3. Appendix A to part 544 is revised to read as follows:
Appendix A--Insurers of Motor Vehicle Insurance Policies Subject to the
Reporting Requirements in Each State in Which They Do Business
Allstate Insurance Group
American Family Insurance Group
American International Group
Auto Club Enterprise Insurance Group \1\
Auto-Owners Insurance Group
Erie Insurance Group
Berkshire Hathaway/GEICO Corporation Group
California State Auto Group \1\
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\1\ Indicates a newly listed company which must file a report
beginning with the report due December 31, 2009.
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Hartford Insurance Group
Liberty Mutual Insurance Companies
Metropolitan Life Auto & Home Group
Mercury General Group
Nationwide Group
Progressive Group
Safeco Insurance Companies
State Farm Group
Travelers Companies
USAA Group
Farmers Insurance Group
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4. Appendix B to part 544 is revised to read as follows:
Appendix B--Issuers of Motor Vehicle Insurance Policies Subject to the
Reporting Requirements Only in Designated States
Alfa Insurance Group (Alabama)
Auto Club (Michigan)
Commerce Group, Inc. (Massachusetts)
Kentucky Farm Bureau Group (Kentucky)
New Jersey Manufacturers Group (New Jersey)
Safety Group (Massachusetts)
Southern Farm Bureau Group (Arkansas, Mississippi)
Tennessee Farmers Companies (Tennessee)
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5. Appendix C to part 544 is revised to read as follows:
Appendix C--Motor Vehicle Rental and Leasing Companies (Including
Licensees and Franchisees) Subject to the Reporting Requirements of
Part 544
Cendant Car Rental
Dollar Thrifty Automotive Group
Enterprise Rent-A-Car
Hertz Rent-A-Car Division (subsidiary of The Hertz Corporation)
U-Haul International, Inc. (Subsidiary of AMERCO)
Vanguard Car Rental USA
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Issued on: January 5, 2010.
Stephen R. Kratzke,
Associate Administrator for Rulemaking.
[FR Doc. 2010-268 Filed 1-11-10; 8:45 am]
BILLING CODE 4910-59-P