[Congressional Record Volume 158, Number 110 (Monday, July 23, 2012)]
[House]
[Pages H5098-H5100]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                              {time}  1650
 REPEAL OF PROVISION RELATING TO MOTOR VEHICLE INSURANCE COST REPORTING

  Mrs. BONO MACK. Mr. Speaker, I move to suspend the rules and pass the 
bill (H.R. 5859) to repeal an obsolete provision in title 49, United 
States Code, requiring motor vehicle insurance cost reporting, as 
amended.
  The Clerk read the title of the bill.
  The text of the bill is as follows:

                               H.R. 5859

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. REPEAL.

       Subsection (c) of section 32302 of title 49, United States 
     Code, is repealed, and any regulations promulgated under such 
     subsection shall have no force or effect.

     SEC. 2. DETERMINATION REGARDING PROVISION OF DAMAGE 
                   SUSCEPTIBILITY INFORMATION TO CONSUMERS.

       (a) In General.--Section 32302(b) of title 49, United 
     States Code, is amended by adding at the end the following: 
     ``The Secretary, after providing an opportunity for public 
     comment, shall study and report to Congress the most useful 
     data, format, and method for providing simple and 
     understandable damage susceptibility information to 
     consumers.''.
       (b) Deadline.--The Secretary of Transportation shall carry 
     out the last sentence of section 32302(b) of title 49, United 
     States Code, as added by subsection (a), not later than the 
     date that is 2 years after the date of the enactment of this 
     Act.

  The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from 
California (Mrs. Bono Mack) and the gentleman from North Carolina (Mr. 
Butterfield) each will control 20 minutes.
  The Chair recognizes the gentlewoman from California.
  Mrs. BONO MACK. Mr. Speaker, I yield myself such time as I may 
consume.


                             General Leave

  Mrs. BONO MACK. Mr. Speaker, I ask unanimous consent that all Members 
have 5 legislative days in which to revise and extend their remarks and 
to insert extraneous materials into the Record on H.R. 5859.
  The SPEAKER pro tempore. Is there objection to the request of the 
gentlewoman from California?
  There was no objection.
  Mrs. BONO MACK. Today, we have an opportunity to slam the car door on 
an obsolete provision in the United States Code requiring motor vehicle 
insurance cost reporting, which is of little or no use to American 
consumers.
  I want to commend Mr. Harper of Mississippi and Mr. Owens of New York 
for their bipartisan work on H.R. 5859, as well as Chairman Upton and 
Ranking Member Waxman for their leadership in moving this legislation 
forward. I also want to thank my good friend and colleague, Mr. 
Butterfield of North Carolina, our subcommittee's ranking member, for 
his help with our efforts to repeal this costly and outdated provision 
of the law.
  Additionally, just this morning, I received word that the five 
leading automotive trade associations in the U.S., including the 
National Automobile Dealers Association, are all supportive of H.R. 
5859, and here's why.
  In 1993, NHTSA issued a final rule requiring new-car dealers to make 
available to buyers a booklet containing the latest information on 
insurance costs. The information is updated by NHTSA annually, based on 
data from the Highway Loss Data Institute.
  The information required by this regulation is rarely sought by 
consumers and its value is highly questionable. Insurance premiums are 
based primarily on factors that are unrelated to the susceptibility of 
damage to a vehicle, including the driver's age, driving record, 
location, and miles driven.
  Additionally, a recent survey of 850 members of the National 
Automobile Dealers Association reported 96 percent of its dealers have 
never been asked by a customer--not even once--to see the insurance 
cost booklet that is at issue here today.
  Clearly, this is yet another example of where the cost of a Federal 
regulation outweighs its potential benefit. As a nation, we simply 
cannot afford to keep doing business that way. And frankly, the current 
law has more problems than an old, dirty, oil-burning engine.
  Today, new-car dealers face civil penalties if they do not provide, 
upon request, the booklet that discloses the relative cost to repair 
vehicles after a collision, yet the data is completely generic and 
skewed by averaging the repair costs of everything from fender-benders 
to vehicle rollovers. How is this useful information to consumers at 
the point of sale?
  Even more troubling, this information is not always accurate or up to 
date. For the most part, it is simply a compilation of historical 
information and does not take into account new model year changes that 
can significantly alter how a car performs in a crash.
  And finally, even the administration suggests this requirement should 
be eliminated. In technical comments provided earlier this year to 
Congress, NHTSA describes the data as, and I'm quoting now:

     rarely used and not useful because the differences in rates 
     due to loss payments are overshadowed by differences in 
     premiums due to driver demographics, geographic location, and 
     the relative prices of the vehicles.

  In other words, the requirement is simply not working as intended, 
and it's become a needless cost and burden to automobile dealers 
nationwide.
  Today, we have an opportunity to tow this clunker of a regulation to 
the junkyard where it belongs and to provide America's nearly 20,000 
automobile dealers with some important regulatory relief.
  Mr. Speaker, I reserve the balance of my time.
  Mr. BUTTERFIELD. Mr. Speaker, I yield myself such time as I may 
consume.
  Mr. Speaker, H.R. 5859 repeals a provision of law related to the 
reporting of automobile insurance cost. This provision requires car 
dealers to make available to prospective buyers information that 
compares insurance costs for different vehicles based on damage 
susceptibility.
  While I am always wary of any attempts to limit consumer information, 
clearly, the provision of law that H.R. 5859 would repeal is simply not 
working as intended.
  Every year, the National Highway Traffic Safety Administration, or 
NHTSA, as we call it, produces and sends to auto dealers a booklet 
containing insurance cost information. Dealers have told us that very 
few consumers even ask for the booklet. Yet, under Federal law, NHTSA 
is still required to produce and distribute these booklets, and dealers 
are still required to make them available.
  I am not opposed, Mr. Speaker, to ending the current reporting 
mandate. However, we should not repeal this mandate without 
acknowledging that the impetus behind the original provision is sound. 
The purpose of the provision was to give consumers a basis for 
comparing damageability risk at the point of sale.
  Damageability is about how much damage a car is likely to sustain 
when a collision occurs, even at very low speed. The law also intended 
to create an incentive for manufacturers to produce cars which are more 
resistant to damage and less expensive to repair and service.
  Whether you think the current requirement is a nuisance for auto 
dealers or you think that NHTSA has missed the mark in its 
implementation of the mandate, I think we should accept that consumers 
continue to have a legitimate interest in minimizing the costs 
associated with minor collisions.
  Therefore, I would like to thank Congressman Harper for his interest 
in this; Congressman Owens, on our side of the aisle, from New York, 
who was one of the original Members of Congress who presented this 
idea; Chairman Bono Mack and Chairman Upton and Ranking Member Waxman 
for all working with me to include alongside the repeal a requirement 
that NHTSA thoroughly examine--that would be the requirement--that 
NHTSA would thoroughly reexamine the issue of how best to inform 
prospective buyers about damage susceptibility.
  I think we have struck the right balance. We fix a valid problem and 
keep in place a valuable principle.

[[Page H5099]]

  Under the bill before us, NHTSA would have 2 years--2 years--to 
conduct a study, solicit public comment, and issue a report to Congress 
that will determine the most useful data, format, and method for 
providing simple and understandable damage susceptibility information 
to consumers. The agency would evaluate whether insurance costs are the 
best measure of damage susceptibility or whether there is a better way 
to make comparisons between vehicles and a better way to make such 
information available to consumers.
  Mr. Speaker, I've said time and time again that information is power, 
and that is certainly true. For example, the NHTSA program Stars on 
Cars, which provides crashworthiness information to consumers, gives 
prospective car buyers information they need about how well a vehicle 
will protect them and their family in the event of a crash. And car 
companies now routinely compete to make safer cars that better protect 
passengers.
  If we pass H.R. 5859, complete with a provision to get NHTSA to find 
a better way for consumers to get important damageability information, 
the same may be accomplished in this case. And so, therefore, I join my 
colleagues in asking all of our colleagues to vote for this amendment.
  I reserve the balance of my time.
  Mrs. BONO MACK. Mr. Speaker, I am pleased to yield 5 minutes to the 
gentleman from Mississippi (Mr. Harper), a terrific member of the 
Commerce, Manufacturing, and Trade Subcommittee.
  Mr. HARPER. Mr. Speaker, I'm proud to be the lead sponsor of H.R. 
5859. This bipartisan bill repeals an obsolete mandate that the 
National Highway Traffic Safety Administration has said is rarely used 
and not helpful.
  Since 1991, the Department of Transportation has annually distributed 
by mail a document, entitled, ``Relative Collision Insurance Cost 
Information.'' This information is sent by mail to new-vehicle dealers 
who are required to make the information available to prospective new-
vehicle customers upon request.

                              {time}  1700

  NHTSA has spent hundreds of thousands of dollars distributing this 
booklet over the past 21 years. While this information is of value to 
insurance actuaries, it has been of little or no use to consumers--for 
whom it is primarily intended. Insurance premiums are set through 
numerous factors that take into account driver characteristics, such as 
age, gender, marital status, driving record, and geographical location. 
No brochure produced annually by the Federal Government can accurately 
gauge a prospective new car owner's insurance premium cost.
  A recent survey by the National Automobile Dealers Association 
confirmed what was expected: out of 800 new car dealers polled, an 
overwhelming 96 percent of the dealers answered that not a single 
customer had ever even asked for a booklet. I would like to make note 
that, if this regulation is repealed, the data will still be compiled, 
and NHTSA will still have the discretion to provide this information to 
consumers on their Web sites.
  We have heard from witnesses like Mr. Jack Fitzgerald, who has been 
in the car business all of his life. Neither he nor his employees have 
ever been asked for a copy of this booklet. In my home State of 
Mississippi, Butch Oustalet of Butch Oustalet Ford Lincoln in Gulfport, 
informed my staff that, despite selling thousands of vehicles to so 
many people over the years, not one customer has ever asked for this 
booklet. Barker Honda of Brookhaven and New South Ford of Meridian also 
reported that no customer has ever asked for a copy of this booklet. 
When customers go into a dealership and ask what their insurance 
premiums will be, they all agree that the best way to get accurate 
quotes is for them to simply contact their insurance agents.
  This simple and bipartisan bill, if passed, would show that Congress 
is serious about efforts to alleviate burdensome and unneeded 
regulations on businesses across this country. The President states 
that it is a priority of his administration's to get rid of absurd and 
unnecessary paperwork requirements that waste time and money. I say 
that Congress should lead now with H.R. 5859.
  I would like to thank Subcommittee Chairman Bono Mack, Chairman Upton 
and the Energy and Commerce Committee for moving H.R. 5859. I would 
also like to thank Congressman Bill Owens from New York for his hard 
work and leadership on this legislation.
  Mr. BUTTERFIELD. Mr. Speaker, I yield such time as he may consume to 
the gentleman from New York (Mr. Owens).
  Mr. OWENS. I thank my colleague.
  Mr. Speaker, I rise today to join Mr. Harper as an original cosponsor 
to offer legislation to repeal an outdated mandate on auto dealerships 
across the country.
  Under current rules, the National Highway Traffic Safety 
Administration is required to distribute a hard copy information 
booklet on vehicle insurance costs to auto dealers. In addition, those 
auto dealers are then required to keep the booklet on hand and make it 
available to prospective customers.
  Before coming to Congress, I had the opportunity to represent Bill 
McBride and Gerry Garrand, two auto dealers located in Plattsburgh, New 
York. Working alongside the McBride and Garrand teams helped me better 
understand the automobile retail market and the pressure dealers are 
under to remain competitive. Today, we have a chance to remove a 
regulation, which we can all agree is outdated, for the benefit of 
taxpayers and businesses like those in my congressional district. I 
believe actions like this make common sense, and I urge more of it.
  Over the past 21 years, NHTSA has spent hundreds of thousands of 
dollars distributing this information, much of which is unnecessary for 
an average customer who is trying to make an informed decision in the 
showroom. Recent surveys show that few, if any, customers ask for this 
information in a given year. In fact, as much as 96 percent of auto 
dealers have never once been asked for this information at all.
  Putting information in the hands of consumers is sensible. For the 
average American family, buying a car is a major expense. Most people 
will consider price, safety ratings, and other features, and will 
compare a number of makes and models before making a purchase. However, 
the data show that few American families make NHTSA's Relative 
Collision Insurance Cost Information booklet a part of that decision-
making process.
  With that in mind, our legislation simply ensures that auto dealers 
will no longer be required to make this unused information available to 
their customers at taxpayer expense. At the same time, the bill allows 
NHTSA and the Highway Loss Data Institute complete flexibility to make 
this information available online, which HLDI has said it will do. This 
is an example of the commonsense bipartisanship we need to see more of, 
working together to reduce outdated, unnecessary or overly burdensome 
regulations to thebenefit of businesses, families, and taxpayers at 
large.
  I thank Mr. Harper for his leadership on this issue and for working 
with me to get this done for auto dealers across the country. Moreover, 
I am pleased to have had the opportunity to have worked with my 
colleagues from both sides of the aisle in order to help make 
government work better. I urge a ``yes'' vote on this legislation.
  Mrs. BONO MACK. Mr. Speaker, I yield 5 minutes to the gentleman from 
Pennsylvania (Mr. Kelly).
  Mr. KELLY. I thank the gentlelady from California.
  Mr. Speaker, I rise today to urge the passage of H.R. 5859. This 
legislation repeals a requirement that auto dealers provide consumers 
with an insurance cost booklet.
  I actually know about this because I am an automobile dealer, and 
I've spent 45 years in the showroom and on the lots. To the best of my 
recollection--and we service anywhere from 800 to 1,000 people a 
month--nobody has ever come into our showroom and ever asked for that 
booklet. It just never happens. This booklet has information that is 
useless and totally irrelevant to the average consumer.
  Let me read from the booklet:

       The table presents vehicles' collision loss experience in 
     relative terms, with 100 representing the average for all 
     passenger vehicles. Thus, a rating of 122 reflects a 
     collision loss experience that is 22 percent higher, or

[[Page H5100]]

     worse, than average while a rating of 96 reflects a collision 
     loss experience that is 4 percent lower, or better, than 
     average.

  It goes on to say:

       It is unlikely your total premium will vary more than 10 
     percent depending upon the collision loss experience of a 
     particular vehicle.

  It then goes on to say that, if you really want to find out about the 
insurance, what you really need to do is to contact the insurance 
carriers or the companies directly.
  Do you know what? I didn't want to base it just on what I know. I've 
talked to a lot of my friends who are also in the automobile business, 
and I've asked them, Have you ever had anybody walk in the store and 
ask for this? They've said, Absolutely not. It has never happened.
  We called the NHTSA hotline, the booklet hotline. The representative 
said--and this is NHTSA's representative--I have no idea about the 
booklet. He said, Do you know what you need to do? You need to call 
your insurance agent. Now, this is NHTSA's person. This is their 
hotline.
  Last month--again, not relying on my 45 years of experience--I went 
back into our store, and I went to one of our sales meetings. I asked 
our guys and our girls, who have a combined sales experience of 250 
years, Listen, I've never had this happen, but has anybody ever come in 
and asked for this insurance collision loss booklet? Nobody--nobody--
had heard of it. Nobody has ever come in--zero, nada--and asked for 
that booklet.
  Now, here is the deal. Dealers have to have this booklet available. 
Should somebody ask for it and you can't provide it, there is a fine of 
$1,000 per occurrence with a max of $400,000. That's what the fine is 
capped at. So, if somebody comes into the showroom and asks for the 
booklet and you don't have it and you get audited on it, it's $1,000. 
Unfortunately, the government caps it at $400,000.
  So, when you look at these things, again, the unintended consequences 
have such a dire effect on the American people. These are taxpayer 
dollars that are being wasted on information that is irrelevant, never 
asked for. Nobody cares about it. So I join my colleagues.
  I thank Mr. Owens, and I also thank Mr. Harper and Mrs. Bono Mack for 
bringing this forward today. It is another waste of taxpayer money that 
serves no purpose to the American people. I urge the passage of H.R. 
5859.
  Mr. BUTTERFIELD. I don't have any more speakers on my side.
  I yield back the balance of my time.
  Mrs. BONO MACK. In closing, I just want to strongly urge the passage 
of H.R. 5859. It passed unanimously out of the Energy and Commerce 
Committee.
  Again, I would like to thank Mr. Butterfield for his hard work, and I 
would like to thank the staff for their hard work and for the 
bipartisan nature that we all approached this with. I would also like 
to thank my staff for their hard work.
  In 1993, this insurance reporting provision probably made sense.

                              {time}  1710

  But today, after being road tested now for nearly 20 years and with 
so much information currently available to consumers simply on the 
Internet, the Kelley Blue Book value on this regulation is just darn 
near next to nothing. Let's junk it and move on.
  With that, Mr. Speaker, I urge passage of this bill, and I yield back 
the balance of my time.
  The SPEAKER pro tempore. The question is on the motion offered by the 
gentlewoman from California (Mrs. Bono Mack) that the House suspend the 
rules and pass the bill, H.R. 5859, as amended.
  The question was taken; and (two-thirds being in the affirmative) the 
rules were suspended and the bill, as amended, was passed.
  A motion to reconsider was laid on the table.

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