BILL ANALYSIS Ó
SENATE COMMITTEE ON TRANSPORTATION AND HOUSING
Senator Jim Beall, Chair
2015 - 2016 Regular
Bill No: SB 438 Hearing Date: 4/7/2015
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|Author: |Hill |
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|Version: |2/25/2015 |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant|Erin Riches |
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SUBJECT: Motor vehicle accidents: reportable property damage
DIGEST: This bill raises the reportable property damage
threshold for traffic accidents from $750 to $1,000.
ANALYSIS:
Existing law:
Requires all drivers and motor vehicle owners to carry evidence
of financial responsibility, defined primarily as written
evidence of valid automobile liability insurance.
Requires a driver who is involved in a traffic accident on a
street or highway that has resulted in damage to the property of
any person in excess of $750, or in the bodily injury or death
of any person, to report the accident within 10 days to the
Department of Motor Vehicles (DMV). Provides that this report
shall include evidence of financial responsibility. Allows the
driver to report either personally or through an insurance
agent, broker, or legal representative.
Exempts a driver from reporting if the vehicle involved in the
accident is owned or leased by a federal, state, or local
agency. Also exempts a driver from filing a report if the
accident occurs off a street or highway (for example, on the
driver's private property) and results in damage only to the
property of the driver or vehicle owner and does not cause
bodily injury or death to another person.
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Requires a driver of a vehicle that is owned, operated, or
leased by his or her employer at the time of the accident to
report the accident to the employer within five days. Requires
the employer, within 10 days of receiving such a report, to file
a report with DMV (unless the employer is a public agency).
Requires a driver of a public transit vehicle to report a
reportable accident to the transit system within 10 days.
Requires the transit system to transmit the report to DMV within
10 days and maintain a record of the report.
Provides, if the driver is not the owner of the vehicle and is
physically incapable of making the report, that the owner shall
file a report with DMV as soon as he or she learns of the
accident.
Requires DMV to suspend the driving privilege of any person who
fails, refuses, or neglects to report a reportable accident.
Prohibits DMV from suspending the individual's driving privilege
until 30 days after DMV has sent notification to the individual
of the pending suspension. Provides that the suspension shall
remain in effect until DMV receives a report or evidence of
financial responsibility.
Provides that all reports pursuant to this law are confidential,
except that DMV shall disclose specified information from the
reports upon request.
Requires DMV to include a summary of the financial
responsibility law, reportable accident requirements, and
penalties for non-compliance with every motor vehicle
registration, registration renewal, and transfer of
registration, as well as with each driver's license and license
renewal.
This bill raises the property damage threshold for a reportable
accident from $750 to $1,000.
COMMENTS:
1.Purpose. The author notes that state law requires a driver
involved in a reportable accident to file a "Report of Traffic
Accident Occurring in California" with DMV. This form, known
as an SR-1, includes the name, address, and insurance
information of each party involved in the accident, along with
SB 438 (Hill) Page 3 of ?
injury and/or property damage details. The property damage
threshold that characterizes an accident as reportable has not
been updated since 2002. The author notes that according to
the U.S. Bureau of Labor Statistics, $750 in 2002 dollars is
equivalent to $984.15 in 2014 dollars. The average "fender
bender" - a minor accident that occurs at low speed and
involves a vehicle's bumper - often results in damage
exceeding the $750 threshold. The author states that because
of the outdated threshold, DMV collects more than 54,000 SR-1
reports per month; this creates unnecessary paperwork for DMV
and an unnecessary burden for California drivers and insurers.
2.Why must drivers report accidents to DMV? A driver must file
an SR-1 for a reportable accident regardless of whether or not
he or she was at fault. This information is public record and
is accessed regularly by law enforcement and insurance
companies. The SR-1 acts as a check to help DMV affirm that a
driver is insured as required by state law. Existing law
also, however, requires DMV to require proof of insurance when
an individual is registering a vehicle or renewing or
transferring the registration of a vehicle. In addition,
existing law requires insurance companies in California to
electronically report vehicle insurance information to DMV
(other than vehicles covered by commercial or business
insurance).
3.The "principally at-fault" threshold. Proposition 103,
approved by California voters in November 1988, requires the
Department of Insurance (DOI) to approve new rates before
insurance companies can implement them. It also requires
insurers to provide a "good driver discount" of 20% to
qualified drivers, defined, in part, as drivers that the
insurer has not determined to be "principally at-fault" in an
accident during the past three years. Proposition 103
establishes that an insurer may determine that a driver is
principally at-fault if his or her actions or omissions were
at least 51% of the legal cause of the accident, and the
accident either resulted in bodily injury or death, or caused
property damage that exceeded a certain threshold.
The principally at-fault threshold was initially set at $500,
based on DMV's reportable accident threshold statute at the
time. SB 1590 (Karnette), Chapter 766, Statutes of 2002,
raised the DMV reportable threshold from $500 to $750; DOI
implemented regulations in 2003 to update the principally
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at-fault threshold to $750. In December 2011, DOI raised the
principally at-fault threshold to $1,000, based on the premise
that the higher threshold was more in keeping with current
costs and would help prevent drivers from being denied a good
driver discount. This bill would raise the DMV reportable
accident threshold to $1,000 to align with the DOI principally
at-fault threshold.
4.Amendments. This bill will be amended on April 6, 2015,
subsequent to this analysis being published, to make several
non-substantive, technical corrections.
5.Double referral. The Rules Committee has referred this bill
to both this committee and the Judiciary Committee.
Therefore, if this bill passes this committee, it will be
referred to the Judiciary Committee.
FISCAL EFFECT: Appropriation: No Fiscal
Com.: Yes Local: No
POSITIONS: (Communicated to the committee before noon on
Wednesday, April 1, 2015.)
SUPPORT:
None received.
OPPOSITION:
None received.
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