[Federal Register Volume 61, Number 68 (Monday, April 8, 1996)]
[Proposed Rules]
[Pages 15443-15446]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-8357]



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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 544

[Docket No. 96-19; Notice 01]
RIN 2127-AF92


Insurer Reporting Requirements; List of Insurers Required to File 
Reports

AGENCY: National Highway Traffic Safety Administration (NHTSA), 
Department of Transportation (DOT).

ACTION: Notice of proposed rulemaking.

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SUMMARY: NHTSA proposes to update its lists in appendices A, B, and C 
of part 544 of passenger motor vehicle insurers that are required to 
file reports on their motor vehicle theft loss experiences. If these 
revised appendices are adopted in a final rule, each insurer included 
in any of these appendices must file a report for the 1993 calendar 
year not later than October 25, 1996. Further, as long as they remain 
listed, they must submit reports by each subsequent October 25.

DATES: Comments on this proposed rule must be received by this agency 
not later than June 7, 1996. If this rule is made final, insurers 
listed in the appendices would be required to submit reports beginning 
with the one due October 25, 1996.

ADDRESSES: Comments on this proposed rule must refer to the docket 
number referenced in the heading of this notice, and be submitted to: 
Docket Section, NHTSA, Room 5109, 400 Seventh Street, SW, Washington, 
DC 20590. Docket hours are 9:30 a.m. to 4:00 p.m., Monday through 
Friday.

FOR FURTHER INFORMATION CONTACT: Ms. Rosalind Proctor, Office of 
Planning and Consumer Programs, NHTSA, 400 Seventh Street, SW, 
Washington, DC 20590. Ms. Proctor's telephone number is (202) 366-0846. 
Her fax number is (202) 493-2739.

SUPPLEMENTARY INFORMATION:

Background

    Pursuant to 49 U.S.C. 33112, Insurer reports and information, NHTSA 
requires certain passenger motor vehicle insurers to file an annual 
report. Each insurer's report includes information about thefts and 
recoveries of motor vehicles, the rating rules used by the insurer to 
establish premiums for comprehensive coverage, the actions taken by the 
insurer to reduce such premiums, and the actions taken by the insurer 
to reduce or deter theft. Under the agency's implementing regulation, 
part 544, the following insurers are subject to the reporting 
requirements: (1) Those issuers of motor vehicle insurance policies 
whose total premiums account for 1 percent or more of the total 
premiums of motor vehicle insurance issued within the United States; 
(2) Those issuers of motor vehicle insurance policies whose premiums 
account for 10 percent or more of total premiums written within any one 
State; and (3) Rental and leasing companies with a fleet of 20 or more 
vehicles not covered by theft insurance policies issued by insurers of 
motor vehicles, other than any governmental entity.
    Pursuant to its statutory exemption authority, the agency has 
exempted smaller passenger motor vehicle insurers from the reporting 
requirements.

A. Small Insurers of Passenger Motor Vehicles

    Section 33112(f) provides that the agency shall exempt small 
insurers of passenger motor vehicles if NHTSA finds that such 
exemptions will not significantly affect the validity or usefulness of 
the information in the reports, either nationally or on a Sate-by-State 
basis. The term ``small insurer'' is defined in Section 33112(f) as an 
insurer whose premiums account for less than 1 percent of the total 
premiums for all forms of motor vehicle insurance issued by insurers 
within the United States. However, that section also stipulates that if 
an insurance company satisfies this definition of a ``small insurer,'' 
but accounts for 10 percent or more of the total premiums

[[Page 15444]]
for all motor vehicle insurance issued in a particular State, the 
insurer must report about its operations in that State.
    As described in the final rule establishing the requirement for 
insurer reports (52 FR 59, January 2, 1987), in 49 CFR Part 544. NHTSA 
exercises its exemption authority by listing in appendix A each insurer 
which must report because it had at least 1 percent of the motor 
vehicle insurance premiums nationally. Listing the insurers subject to 
reporting instead of each insurer exempted from reporting because it 
had less than 1 percent of the premiums nationally is administratively 
simpler since the former group is much smaller than the latter. In 
appendix B, NHTSA lists those insurers that are required to report for 
particular states because each insurer had a 10 percent or greater 
market share of motor vehicle premiums in those States. In the January 
1987 final rule, the agency stated that appendices A and B will be 
updated annually. It has been NHTSA's practice to update the appendices 
based on data voluntarily provided by insurance companies to A.M. Best, 
and made available for the agency each spring. The agency uses the data 
to determine the insurers' market shares nationally and in each state.

B. Self-insured Rental and Leasing Companies

    In addition, upon making certain determinations, NHTSA is 
authorized to grant exemptions to self-insurers, i.e., any person who 
has a fleet of 20 or more motor vehicles (other than any governmental 
entity) which are used primarily for rental or lease and which are not 
covered by theft insurance policies issued by insurers of passenger 
motor vehicles, 49 U.S.C. 33112(b)(1) and (f). NHTSA may exempt a self-
insurer from reporting, if the agency determines:
    (1) The cost of preparing and furnishing such reports is excessive 
in relation to the size of the business of the insurer; and
    (2) The insurer's report will not significantly contribute to 
carrying out the purposes of chapter 331.
    In a final rule published June 22, 1990 (55 FR 25606), the agency 
granted a class exemption to all companies that rent or lease fewer 
than 50,000 vehicles because it believed that reports from only the 
largest companies would sufficiently represent the theft experience of 
rental and leasing companies. NHTSA concluded that reports by the many 
smaller rental and leasing companies do not significantly contribute to 
carrying out NHTSA's statutory obligations, and that exempting such 
companies will relieve an unnecessary burden on most companies that 
potentially must report. As a result of the June 1990 final rule, the 
agency added a new appendix C, which consists of an annually updated 
list of the self-insurers that are subject to part 544. Following the 
same approach as in the case of appendix A, NHTSA has included in 
appendix C each of the relatively few self-insurers which are subject 
to reporting instead of relatively numerous self-insurers which are 
exempted. NHTSA updates appendix C based primarily on information from 
the publications Automotive Fleet Magazine and Travel Business Travel 
News.

C. When a Listed Insurer Must File a Report

    Under Part 544, as long as an insurer is listed, it must file 
reports on or before each October 25. Thus, any insurer listed in the 
appendices as of the date of the most recent final rule must file a 
report by the following October 25, and by each succeeding October 25, 
absent a further amendment removing the insurer's name from the 
appendices.

Notice of Proposed Rulemaking

1. Insurers of Passenger Motor Vehicles

    Based on the 1993 calendar year A.M. Best data for market shares, 
NHTSA proposes to amend the list in appendix A of insurers which must 
report because each had at least one percent of the motor vehicle 
insurance premiums on a national basis. The list was last amended in a 
notice published on June 27, 1995 (See 60 FR 33145). One company, 
General ACC Group, included in the June 1995 listing, is proposed to be 
removed from appendix A. Two companies, Allmerica Property and Casualty 
Companies, and Metropolitan Group, that were not listed in appendix A, 
are proposed to be added.
    Each of the 19 insurers listed in appendix A of this notice would 
be required to file a report not later than October 25, 1996, setting 
forth the information required by part 544 for each State in which it 
did business in the 1993 calendar year. As long as those 19 insurers 
remain listed, they would be required to submit reports by each 
subsequent October 25 for the calendar year ending slightly less than 3 
years before.
    Appendix B lists those insurers that would be required to report 
for particular States for calendar year 1993, because each insurer had 
a 10 percent or greater market share of motor vehicle premiums in those 
States. Based on the 1993 calendar year A.M. Best data for market 
shares, it is proposed that Nodak Mutual Insurance Company, reporting 
on its activities in the State of North Dakota be added to appendix B.
    The 12 insurers listed in appendix B of this notice would be 
required to report on their calendar year 1993 activities in every 
State in which they had a 10 percent or greater market share. These 
reports must be filed no later than October 25, 1996, and set forth the 
information required by part 544. As long as those 12 insurers remain 
listed, they would be required to submit reports on or before each 
subsequent October 25 for the calendar year ending slightly less than 3 
years before.

2. Rental and Leasing Companies

    Based on information in Automotive Fleet Magazine and Travel Trade 
Business Travel News for 1993, the most recent year for which data are 
available, NHTSA is proposing several changes in Appendix C. As 
indicated above, that appendix lists rental and leasing companies 
required to file reports. Based on the data reported in the above 
mentioned publications, it is proposed that the American International 
Rent-A-Car Corp./ANSA be removed from appendix C. The agency also 
proposes that four additional rental and leasing companies, Citicorp 
Bankers Leasing Corporation, Donlen Corporation, Lease Plan 
International, and USL Capital Fleet Services, be included in appendix 
C. Accordingly, each of the 13 companies (including franchisees and 
licensees) listed in this notice in appendix C would be required to 
file reports for calendar year 1993 no later than October 25, 1996, and 
set forth the information required by part 544. As long as those 13 
companies remain listed, they would be required to submit reports on or 
before each subsequent October 25 for the calendar year ending slightly 
less than 3 years before.
    NHTSA notes that on July 5, 1994, the Cost Savings Act, (including 
Title VI- Theft Prevention) was revised and codified ``without 
substantive change.'' The passenger motor vehicle theft insurers' 
reporting provisions, formerly at 15 U.S.C. 2032 are now at 49 U.S.C. 
33112. In this NPRM, NHTSA proposes to make minor technical amendments 
to make part 544 reflect its changed statutory authority.

Regulatory Impacts

1. Costs and Other Impacts

    This notice has not been reviewed under Executive Order 12866. 
NHTSA has considered the impact of this proposed rule and has 
determined the action not to be ``significant'' within the

[[Page 15445]]
meaning of the Department of Transportation's regulatory policies and 
procedures. This proposed rule implements the agency's policy of 
ensuring that all insurance companies that are statutorily eligible for 
exemption from the insurer reporting requirements are in fact exempted 
from those requirements. Only those companies that are not statutorily 
eligible for an exemption are required to file reports.
    NHTSA does not believe that this proposed rule, reflecting more 
current data, affects the impacts described in the final regulatory 
evaluation prepared for the final rule establishing part 544. (52 FR 
59, January 2, 1987) Accordingly, a separate regulatory evaluation has 
not been prepared for this rulemaking action. Using the cost estimates 
in the 1987 final regulatory evaluation, the agency estimates that the 
cost of compliance will be about $5,770 for any insurer added to 
appendix C. If this proposed rule is made final, for appendix A, the 
agency would remove one insurer and add two insurers; for appendix B, 
the agency would add one insurer; and for appendix C, the agency would 
remove one company and include four additional companies. The agency 
therefore estimates that the net effect of this proposal, if made 
final, would be a cost increase to insurers, as a group of 
approximately $87,310.
    Interested persons may wish to examine the 1987 final regulatory 
evaluation. Copies of that evaluation have been placed in Docket No. 
T86-01; Notice 2. Any interested person may obtain a copy of this 
evaluation by writing to NHTSA, Docket Section, Room 5109, 400 Seventh 
Street, S.W., Washington, DC 20590, or by calling (202) 366-4949.

2. Paperwork Reduction Act

    The information collection requirements in this proposed rule have 
been submitted to and approved by the Office of Management and Budget 
(OMB) pursuant to the requirements of the Paperwork Reduction Act (44 
U.S.C. 3501 et seq.) This collection of information has been assigned 
OMB Control Number 2127-0547 (``Insurer Reporting Requirements'') and 
has been approved for use through October 31, 1996.

3. Regulatory Flexibility Act

    The agency has also considered the effects of this rulemaking under 
the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.) I certify 
that this proposed rule would not have a significant economic impact on 
a substantial number of small entities. The rationale for the 
certification is that none of the companies proposed to be included on 
appendices A, B, or C would be construed to be a small entity within 
the definition of the RFA. ``Small insurer'' is defined in part under 
49 U.S.C. 33112 as any insurer whose premiums for all forms of motor 
vehicle insurance account for less than one percent of the total 
premiums for all forms of motor vehicle insurance issued by insurers 
within the United States, or any insurer whose premiums within any 
State, account for less than 10 percent of the total premiums for all 
forms of motor vehicle insurance issued by insurers within the State. 
This notice would exempt all insurers meeting those criteria. Any 
insurers meeting those criteria is not a small entity. In addition, in 
this rulemaking, the agency proposes to exempt all ``self insured 
rental and leasing companies'' that have fleets of fewer than 50,000 
vehicles. Any self insured rental and leasing company too large to meet 
that criterion is not a small entity.

4. Federalism

    This action has been analyzed in accordance with the principles and 
criteria contained in Executive Order 12612, and it has been determined 
that the proposed rule does not have sufficient federalism implications 
to warrant the preparation of a Federalism Assessment.

5. Environmental Impacts

    In accordance with the National Environmental Policy Act, NHTSA has 
considered the environmental impacts of this proposed rule and 
determined that it would not have a significant impact on the quality 
of the human environment.
    Interested persons are invited to submit comments on the proposal. 
It is requested but not required that 10 copies of the comments be 
submitted. All comments must not exceed 15 pages in length. (49 CFR 
553.21). Necessary attachments may be appended to these submissions 
without regard to the 15 page limit. This limitation is intended to 
encourage commenters to detail their primary arguments in a concise 
fashion.
    If a commenter wishes to submit certain information under a claim 
of confidentiality, three copies of the complete submission, including 
purportedly confidential business information, should be submitted to 
the Chief Counsel, NHTSA, at the street address given above, and seven 
copies from which the purportedly confidential information deleted 
should be accompanied by cover letter setting forth the information 
specified in the agency's confidential business information regulation. 
(49 CFR part 512).
    All comments received before the close of business on the comment 
closing date indicated above for the proposal will be considered, and 
will be available for examination in the docket at the above address 
both before and after the date. To the extent possible, comments filed 
after the closing date will also be considered. Comments received too 
late for consideration in regard to the final rule will be considered 
as suggestions for further rulemaking action. Comments on the proposal 
will be available for inspection in the docket. NHTSA will continue to 
file relevant information as it becomes available in the docket after 
the closing date, and it is recommended that interested persons 
continue to examine the docket for new material.
    Those persons desiring to be notified upon receipt of their 
comments in the rules docket should enclose a self-addressed, stamped 
postcard in the envelope with their comments. Upon receiving the 
comments, the docket supervisor will return the postcard by mail.

List of Subjects in 49 CFR Part 544

    Crime insurance, insurance, insurance companies, motor vehicles, 
reporting and recordkeeping requirements.
    In consideration of the foregoing, 49 CFR Part 544 is proposed to 
be amended as follows:

PART 544--[AMENDED]

    1. The authority citation for part 544 would be revised to read as 
follows:

    Authority: 49 U.S.C. 33112; delegation of authority at 49 CFR 
1.50.

    2. Section 544.2 Purpose. would be revised to read as follows:


Sec. 544.2  Purpose.

    The purpose of these reporting requirements is to aid in 
implementing and evaluating the provisions of 49 U.S.C. chapter 331 
Theft Prevention to prevent or discourage the theft of motor vehicles, 
to prevent or discourage the sale or distribution in interstate 
commerce of used parts removed from stolen motor vehicles, and to help 
reduce the cost to consumers of comprehensive insurance coverage for 
motor vehicles.
    3. Paragraph (a) of Sec. 544.4 Definitions would be revised to read 
as follows:


Sec. 544.4  Definitions.

    (a) Statutory terms. All terms defined in 49 U.S.C. 32101 and 33112 
are used in accordance with their statutory

[[Page 15446]]
meanings unless otherwise defined in paragraph (b) of this section.
* * * * *
    4. Paragraph (a) of Sec. 544.5 would be revised to read as follows:


544.5  General requirements for reports.

* * * * *
    (a) Each insurer to which this part applies shall submit a report 
annually not later than October 25, beginning on October 25, 1986. This 
report shall contain the information required by Sec. 544.6 of this 
part for the calendar year three years previous to the year in which 
the report is filed (e.g., the report due by October 25, 1996 shall 
contain the required information for the 1993 calendar year).
* * * * *
    5. Appendix A to Part 544 would be revised to read as follows:

Appendix A--Insurers of Motor Vehicle Insurance Policies Subject to the 
Reporting Requirements in Each State in Which They Do Business

Aetna Life & Casualty Group
Allmerica Property & Casualty Companies\1\

    \1\ Indicates a newly listed company which must file a report 
beginning with the report due October 25, 1996
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Allstate Insurance Group
American Family Group
American International Group
California State Auto Association
CNA Insurance Companies
Farmers Insurance Group
Geico Corporation Group
ITT Hartford Insurance Group
Liberty Mutual Group
Metropolitan Group\1\
Nationwide Group
Progressive Group
Prudential of America Group
Safeco Insurance Companies
State Farm Group
Travelers Insurance Group
USAA Group

    6. Appendix B to Part 544 would be revised to read as follows:

Appendix B--Issuers of Motor Vehicle Insurance Policies Subject to the 
Reporting Requirements Only in Designated States

Alfa Insurance Group (Alabama)
Amica Mutual Insurance Company (Rhode Island)
Arbella Mutual Insurance (Massachusetts)
Auto Club of Michigan (Michigan)
Commerce Group, Inc. (Massachusetts)
Commercial Union Insurance Companies (Maine)
Concord Group Insurance Companies (Vermont)
Erie Insurance Group (Pennsylvania)
Kentucky Farm Bureau Group (Kentucky)
Nodak Mutual Insurance Company (North Dakota) \1\

    \1\ Indicates a newly listed company which must file a report 
beginning with the report due October 25, 1996
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Southern Farm Bureau Casualty Group (Arkansas, Mississippi)
Tennessee Farmers Companies (Tennessee)
    7. Appendix C to Part 544 would be revised to read as follows:

Appendix C--Motor Vehicle Rental and Leasing Companies (Including 
Licensees and Franchisees) Subject to the Reporting Requirements of 
Part 544

Alamo Rent-A-Car, Inc.

Avis, Inc.
Budget Rent-A-Car Corporation
Citicorp Bankers Leasing Corporation \1\
Dollar Rent-A-Car Systems, Inc.
Donlen Corporation \1\
Hertz Rent-A-Car Division (subsidiary of Hertz Corporation)
Lease Plan International \1\
National Car Rental System, Inc.
Penske Truck Leasing Company
Ryder System, Inc. (Both rental and leasing operations)
U-Haul International, Inc. (Subsidiary of AMERCO)
USL Capital Fleet Services \1\

    \1\ Indicates a newly listed company which must file a report 
beginning with the report due October 25, 1996

    Issued on: April 1, 1996.
Barry Felrice,
Associate Administrator for Safety Performance Standards.
[FR Doc. 96-8357 Filed 4-5-96; 8:45 am]
BILLING CODE 4910-59-P