Mon09012014

On The Road

DMV develops insurance program

About four million California motorists should find it easier to register their vehicles under a new electronic insurance reporting program being developed by the Department of Motor Vehicles (DMV) and five insurance companies doing business in California.

Currently, the law requires motorists to obtain written evidence of insurance from their insurer and then provide it to the DMV. Under the pilot - which is expected to begin this summer - insurance companies would voluntarily report vehicle insurance information to the state electronically, thus eliminating the need for motorists to do so.

The DMV is working with the Automobile Club of Southern California, the California State Automobile Association and The Hartford, Kemper and Mercury Casualty Insurance Companies to develop the program.

Only motorists insured with these companies will be involved.

The program will be designed to support a law, passed by the legislature in 1996, requiring motorists to provide evidence of insurance to the DMV when registering a vehicle, or on demand by a law enforcement officer during a traffic stop.

In addition to allowing insurance companies to electronically report new, changed and terminated policies, the new system will make it easier for the DMV to track motorists without insurance or those who have allowed their insurance policies to lapse.

"Full industry participation in electronic registration reporting would save taxpayers millions of dollars in processing fees," said DMV Director Sally Reed

Reed estimated that with full industry involvement, processing costs would drop from $19 million a year for a paper-based system to $6.5 million a year.

The DMV is sending letters to all car insurance companies doing business in California inviting them to join the five companies, or to participate in an industry-wide system once it's developed.

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