HB 264-PROOF OF INSURANCE: UNSATISFIED JUDGMENTS    4:16:34 PM CO-CHAIR KREISS-TOMKINS announced that the next order of business would be HOUSE BILL NO. 264, "An Act relating to proof of financial responsibility after certain motor vehicle accidents." 4:17:08 PM REID HARRIS, Staff, Representative Jonathan Kreiss-Tomkins, Alaska State Legislature, on behalf of Representative Kreiss- Tomkins, prime sponsor of HB 264, relayed that HB 264 addresses the statute on unsatisfied judgements [AS 28.20.330(b)]; upon receiving an unsatisfied judgement, one must obtain a proof of financial responsibility (POFR) - commonly referred to as an SR- 22 certificate. He pointed out that an SR-22 is not insurance, but a certificate that states that a high-risk individual has insurance. He defined that a high-risk individual is someone with a "driving under the influence (DUI)" conviction or an "unsatisfied judgement." An unsatisfied judgement is a judgement issued against someone who had a motor vehicle accident causing death, bodily injury, or damage to property over $501, and who did not pay for damages. Subsequently, the person's license is revoked by the Division of Motor Vehicles (DMV) [Department of Administration (DOA)] and is not returned unless and until the judgement is staid or satisfied. MR. HARRIS turned the committee's attention to the document from DMV, included in the committee packet, entitled "SR-22 Insurance," to review the time requirements for an SR-22: for a first offense driving while intoxicated (DWI), the requirement is 5 years; a second offense is 10 years; a third offense is 20 years; a fourth offense is a lifetime requirement. In addition to a fourth offense DWI, just one unsatisfied judgement also results in the lifetime requirement. He offered that under HB 264, when the judgement is staid or satisfied, the SR-22 would be required for 3 years, not a lifetime. MR. HARRIS referred to House Bill 409 [introduced during Thirtieth Alaska State Legislature, (2017-2018)], which addressed unsatisfied judgements and DUIs was not supported by DOA. The proposed legislation only addresses unsatisfied judgement. MR. HARRIS referred to testimony during the presentation on "Alaska Rehabilitation & Reentry" [2/27/20 House State Affairs Standing Committee meeting] in which the testifier offered that paying for the SR-22 was very difficult for someone released from prison and struggling with many financial challenges. Mr. Harris relayed that the Division of Insurance [Department of Commerce, Community & Economic Development (DCCED)] provided information that the SR-22 can cost from 5-50 percent of a standard premium. The testifier stated that he was paying [$500] per month to retain a driver's license. Mr. Harris expressed his belief that the requirement targets low-income people and people who are trying to improve themselves. The intent of the proposed legislation is to remedy that. 4:22:16 PM REPRESENTATIVE VANCE asked why 3 years was chosen for the length of time [an SR-22 would be required]. MR. HARRIS responded that 3 years was arbitrarily chosen but seemed to represent an appropriate length of time for someone to prove he/she has "fixed" the mistake. CO-CHAIR KREISS-TOMKINS expressed his desire for the legislature to evaluate categorically the value that SR-22 offers to the public. The SR-22 laws were put into statute before Alaska required car insurance; HB 264 offers a temporary fix; the 3 years is arbitrary. MR. HARRIS referred to the Legislative Research Services document, dated 11/21/19 and entitled "SR-22 Automobile Insurance Requirements," not included in the committee packet, to describe the requirement put in place in [1959], which read: The legislature is concerned over the rising toll of motor vehicle accidents and the suffering and loss thereby inflicted. The legislature determines that it is a matter of grave concern that motorists shall be financially responsible for their negligent acts ...." MR. HARRIS added that the state's mandatory insurance laws were enacted many years later. REPRESENTATIVE HOPKINS asked whether SR-22 being a lifetime requirement was enacted under HB 49 [signed into law 7/8/19] or previously. CO-CHAIR KREISS-TOMKINS expressed his understanding is that HB 49 did not address the SR-22 requirements but did address the reentrant's ability to get back a driver's license to become a productive citizen. 4:26:47 PM JOANN OLSEN, Interim Director, Division of Motor Vehicles (DMV), Department of Administration (DOA), responded that she was not familiar with HB 49. MR. HARRIS offered to follow up. 4:27:25 PM LORI WING-HEIER, Director, Division of Insurance, Department of Commerce, Community & Economic Development (DCCED), explained that an SR-22 filing is a certificate to the state that the person has liability insurance on the vehicle he/she is driving or to which the person has access. CO-CHAIR KREISS-TOMKINS asked for an explanation for why an SR- 22 is needed when car insurance is mandatory. He opined that it seems redundant. MS. WING-HEIER answered that she cannot explain why but knows that when renewing vehicle tags, a box verifying insurance must be checked. Similarly, the SR-22 serves as a second certification of liability insurance for an individual with an unsatisfied judgement or with the violation convictions - mentioned by Mr. Harris - in order to drive or have access to a vehicle. She defined "have access to" as meaning a vehicle that the person may drive but not necessarily own; it is the vehicle itself that requires the SR-22. CO-CHAIR KREISS-TOMKINS asked why the SR-22 costs so much when premiums are paid to the insurance company and the SR-22 merely verifies that the insurance policy is in place. MS. WING-HEIER answered that part of the reason is the violation itself. She explained the other part as follows: The division looked at 23 insurance companies in the state and only 6 were providing SR-22s to insurers who requested them. The insurers can charge rates based on a driver's record; for a record with a DUI or reckless driving, insurance will cost more. The SR-22 is somewhat of a "scarlet letter" indicating that there is a reason the person has been asked to keep a certificate on file with the state; the insurers are, therefore, hesitant to insure someone with an SR-22. That person may be moved to a sub-standard insurance market and have a surcharge in addition. The surcharge is strictly for liability insurance but is applied to the premium's comprehension and collision coverages as well. CO-CHAIR KREISS-TOMKINS stated that HB 264 would be held over.