BILL ANALYSIS �
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Date of Hearing: April 18, 2012
ASSEMBLY COMMITTEE ON INSURANCE
Jose Solorio, Chair
AB 1551 (Torres) - As Introduced: January 26, 2012
SUBJECT : Automobile Insurance: public safety officers
SUMMARY : Provides an exemption from the duty to report
automobile accidents to a private insurer if the accident occurs
while a public safety officer is driving his or her personal
vehicle at the request or direction of the employer, in the
course of the officer's duties. Specifically, this bill :
1)Prohibits insurers from increasing the automobile insurance
premium charged to a peace officer or firefighter based on an
accident that occurs when they are driving a private vehicle
in the course of their duty at the request or direction of
their employer.
2)Specifies that peace officers and firefighters are not
required to report accidents to their insurer that occur when
they are driving a private vehicle in the course of their duty
at the request or direction of their employer.
3)Specifies that the employer of a peace officer or firefighter
may not require a peace officer or firefighter to report
accidents that occur when they are driving a private vehicle
in the course of their duty at the request or direction of
their employer.
4)Specifies that any time a private vehicle is used by a peace
officer or firefighter at the request or direction of their
employer, the employer shall bear all liability for accidents
or injuries.
5)Requires the employer of a peace officer or firefighter to
assume liability for any accident or injury when there is a
dispute regarding whether the vehicle was being used at the
direction or request of the employer.
6)Requires the private passenger insurer to reimburse the
employer if it is determined that the employer did not direct
or request the employee to use the vehicle when the accident
or injury occurred.
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7)Prohibits insurers from using a "good faith" delay in
reporting an accident as a basis to claim delayed reporting,
noncooperation, prejudice, or the like as a reason to avoid
any obligations they may have in the insurance policy.
8)Defines "private passenger motor vehicle" or "private motor
vehicle" as a motor vehicle that is insured under a personal
automotive liability policy and has at least four wheels.
9)Provides that a report indicating that a vehicle is owned and
operated by a peace officer or firefighter in the performance
of his or her duty and at the direction of his or her employer
is satisfactory evidence of financial responsibility.
EXISTING LAW:
1) Provides that no peace officer, member of the California
Highway Patrol (CHP), or firefighter is required to report,
to his or her private automobile insurance carrier, any
accident in which he or she is involved while operating an
authorized emergency vehicle or any employer-leased or
employer-rented vehicle, in the performance of his or her
duty, during the hours of his or her employment.
2) Provides that no insurer may increase the premium on a
private automobile insurance policy, or deny renewal of the
private automobile insurance policy, of a peace officer,
member of the CHP, or firefighter, due to an accident in
which that individual was involved while operating an
authorized emergency vehicle in the performance of his or her
duty, during the hours of his or her employment.
3) Provides that, if an employee or former employee of a public
entity asks that public entity to defend him or her against
any claim or action for an injury arising out of an act or
omission occurring within the scope of his or her employment,
as specified, and if the employee or former employee
cooperates in good faith in the defense of that claim or
action, the public entity must pay any judgment or any
compromise or settlement of the claim or action to which the
public entity agrees.
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4) Requires the driver of a motor vehicle that is involved in
an accident which results in property damage in excess of
$750 or in bodily injury or death, to report the accident to
the Department of Motor Vehicles (DMV), provided that a
report is not required, if the motor vehicle involved in the
accident is owned or leased by, or under the direction of,
the United States, California, another state, or a local
agency.
5) Requires every driver or employer that is involved in an
accident subject to the reporting requirements noted in item
4, above, to provide evidence of financial responsibility to
DMV, however that evidence may be established by filing a
report with DMV indicating that the motor vehicle involved in
the accident was owned, rented, or leased by or under the
direction of the United States, California, or any political
subdivision of California or a California municipality.
6) Requires an owner of a motor vehicle to maintain evidence of
financial responsibility that meets specified minimum
standards. This is almost always accomplished through the
purchase of an automobile insurance policy.
FISCAL EFFECT : Unknown
COMMENTS :
1)Purpose. According to the author, and the sponsor, California
Professional Firefighters, local agencies are increasingly
asking safety officers, especially firefighters, to drive in
their personal vehicles to work-related locations. This
places the officers' personal driving records at risk, and
adversely impacts their premium expenses for their personal
automobile insurance policy. They argue that these costs
should be part of the employment costs covered by the public
agency, and this bill remedies the problem.
2)Department of Insurance Regulations . According to regulations
adopted by the Insurance Commissioner that govern when an
insurer may determine that a driver was principally at fault
in an accident, the insurer is prohibited from doing so if
"The driver was responding to a call of duty as a paid or
volunteer member of any police or fire department, first aid
squad, or of any law enforcement agency, while performing any
other governmental function in a public emergency." While
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this provision provides some protection to a public safety
officer, it does not fully address the issue of who should be
responsible for incidents that occur during the course of
employment that do not rise to the level of a public
emergency.
3)Mileage Rate. Public employees using their personal vehicles
for work purposes are commonly provided reimbursement based on
the number of miles driven. The standard business rate of
reimbursement per mile is established each year by the
Internal Revenue Service. The current reimbursement rate is
$0.555 per mile. This rate includes items such as
depreciation or lease payments, maintenance and repairs,
tires, gasoline (including taxes), oil, insurance, and license
and registration fees when calculating the reimbursement rate.
4)Prior Legislation. In 2010, identical legislation was vetoed
(Assembly Bill 2151 (Torres)). The Governor's veto message
provided:
"This bill would provide that peace officers, members of
the California Highway Patrol, and firefighters would not
be required to report any accidents to their private
automobile insurer while operating their personal vehicles
at the request and direction of their employer. This bill
would further require all state and local agencies
employing peace officers or firefighters to pay the costs
of any accident and all damages regardless of whether the
driver of the vehicle was acting recklessly or with gross
negligence.
While there may be reasons for state and local entities to
pay the costs of automobile accidents while employees are
responding to emergency situations in their private
vehicles, this measure would require indemnification in all
situations regardless of the driver's fault, which is
unwarranted. Moreover, the Internal Revenue
Service-established mileage reimbursement rate already
covers costs for insurance for employees that use their
private vehicles for work purposes. Since this measure will
unreasonably shift costs to public employers in a time of
fiscal crisis, I am unable to sign this bill."
REGISTERED SUPPORT / OPPOSITION :
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Support
California Professional Firefighters (Sponsor)
American Federation of State, County and Municipal Employees
Association of Los Angeles Deputy Sheriffs
Association of Orange County Deputy Sheriffs
California Fraternal Order of Police
California State Sheriffs Association
L.A. County Probation Officers Union
Long Beach Police Officers Association
Los Angeles County Professional Peace Officers Association
Los Angeles Police Protective League
Orange County Professional Firefighters Association
Peach Officers Research Association of California (PORAC)
Riverside Sheriffs Association
San Diego Schools Police Officers Association
Santa Ana Police Officers Association
Opposition
California League of Cities
California State Association of Counties
CSAC Excess Insurance Authority
Regional Council of Rural Counties
Analysis Prepared by : Paul Riches / INS. / (916) 319-2086