SB 158 - INSURANCE CHANGES FOR DR. LIC REVOC. CHAIRMAN LEMAN announced SB 158 to be up for consideration. MR. JOE AMBROSE, Aide to Senator Taylor, sponsor, said they have a proposed committee substitute. He explained that the original bill applied to all the violations that are subject to the "use it and lose it" law; the committee substitute applies only to a "minor consuming." In other words they have narrowed the scope of the legislation. SENATOR MACKIE moved to adopt CSSB 158 version H. There were no objections and it was so ordered. MR. AMBROSE said because the law results in the suspension or revocation of a minor's drivers license, insurance rates for both the minor and his parents increase if coverage is offered at all. SB 158 is intended to correct the situation by prohibiting an insurer from exercising its right to cancel a policy or raise rates based solely on a license suspension for a minor consuming. MS. JUANITA HENSLEY, Chief, Driver Services, testified when this bill was passed three years ago the legislature did not want to penalize these individuals with SR 22, high risk insurance. The use it or lose it law was intended to be remedial, not punitive. Since it did not involve a motor vehicle, SR 22 should not be required. The legislature agreed and that was put in Title 28. Since then it has been found that insurance companies have been charging surcharges to families who have minors whose licenses are revoked under the use it/lose it law. She has had several complaints. In some cases the insurance industry is requiring clients to either exclude the minor from the policy and cancel the driver's license until the 18th birthday or to pay increased the premiums so the family can't afford insurance any more. This is not the intent of the legislation. MS. SARAH MCNARE GROVE, Insurance Analyst, Division of Insurance, said they support SB 158 because they have also received complaints from parents who say their insurance rates have gone up because their kids have had their license revoked for an administrative reason. MR. JOHN GEORGE, National Association of Independent Insurers, said that an underage driver, even though he is not drinking, is using bad judgement by drinking at all. The fact that they drink while not driving might just mean that they haven't been caught drinking and driving. Their basic opposition with the bill is that insurance companies are very competitive and some companies may choose this as a rating criteria and this is a competitive difference. All companies resist what they may and may not use by the legislature. All rates have to be approveD by the Division of Insurance and in the rating plan you list the things that will be penalized and they will be approved or disapproved. The fact that the Division of Insurance supports the bill implies to him that if they make a filing and used an administrative revocation for the reason for increasing or denying coverage, the Division would deny that. CHAIRMAN LEMAN asked if there was a substantial cost to the insurance company for the reinstatement of an administrative revocation of a license that this bill would prevent the collection of. MR. GEORGE replied that he didn't think there would be a great cost. It is interesting, though, if a license is under suspension, there is no reason that the individual should be included under the insurance policy because they would be driving without a license. He thought the real concern would be when they got their license back. CHAIRMAN LEMAN asked if these revocations are only from the minor consuming or the minor in the presence of other minors consuming. Number 495 MS. HENSLEY said it could relate to minors who are at a party, but who aren't consuming, but because they are within an arms-reach of alcohol they can be charged; and their license will be revoked. MR. GEORGE asked if they were talking of ages up to 18. MS. HENSLEY replied up through 21. SENATOR MACKIE said he voted for the legislation being discussed and it was designed to serve as a deterrent for minors to consume; and not designed as a way to increase insurance rates. This is the issue. MR. GEORGE said he didn't have an opinion, but he didn't disagree necessarily. Number 462 SENATOR MILLER said he didn't see a great administrative cost to an insurance company to add or subtract an individual's name from an existing policy, because 99.9 percent of these are going to be on parent's policies vs. and individual child's policy. CHAIRMAN LEMAN said he wanted to hold this bill and take it up at the next meeting.