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Summary: Many insurance companies voluntarily provide coverage for policyholders who replace their cars under the same policy for a period of 20-30 days, or until the policyholder notifies the insurer. HB 949 would require all insurers to continue coverage for policyholders who replace their car and notify the insurer within 20 days or some other length of time specified in the policy. Additionally, HB 949 would require insurers to apply the broadest coverage included in the plan to any new car that is in addition to the cars already in the policy, provided the insurer is notified within 20 days.
Analysis: Although most insurance companies already follow this practice, there are some companies that offer low price auto insurance but do not provide a grace period when the policyholder switches vehicles. Because driving without insurance is a violation of the law, the current policy allowing insurers not to have a grace period makes criminals out of some new car owners. HB 949 promotes personal responsibility and rewards those who follow the rules by reducing the chance of being penalized by a technicality in their coverage that does not meet industry standards. Additionally, a driver without auto insurance is a liability to the rest of the drivers on the road. HB 949 would protects the rights of new car owners, as well as other motorists on the road, by ensuring that the newly acquired vehicle is insured at the time it is driven off the lot.