[Federal Register Volume 61, Number 157 (Tuesday, August 13, 1996)]
[Rules and Regulations]
[Pages 41985-41987]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-20569]


      
      

[[Page 41985]]

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 544

[Docket No. 96-19; Notice 02]
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: Final rule.

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SUMMARY: This final rule updates the list 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, pursuant to 49 
U.S.C. Section 33112. Each insurer listed must file a report for the 
1993 calendar year not later than October 25, 1996. Further, as long as 
an insurer remains listed, it must submit reports on each subsequent 
October 25.

DATES: The final rule on this subject is effective August 13, 1996.
    Reporting Date: Insurers listed in the appendices are required to 
submit reports on their calendar year 1993 experience on or before 
October 25, 1996. Previously listed insurers whose names are removed by 
this notice need not submit reports for that year. Insurers newly 
listed in this final rule must submit their reports for calendar year 
1993 on or before October 25, 1996. Under Part 544, as long as an 
insurer is listed, it must file reports each October 25. Thus, any 
insurer listed in the appendices as of the date of the most recent 
final rule must file a report on the following October 25, and on each 
succeeding October 25, absent a further amendment removing the 
insurer's name from the appendices.

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) 366-1740. 
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 with the agency. 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, 49 CFR 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)(2) provides that NHTSA shall exempt small insurers 
of passenger motor vehicles if it finds that such exemptions will not 
significantly affect the validity or usefulness of the information in 
the reports, either nationally or on a State-by-State basis. The term 
``small insurer'' is defined in Section 33112(f)(1)(A) and (B) as an 
insurer whose premiums for motor vehicle insurance issued directly or 
through an affiliate, including pooling arrangements established under 
State law or regulation for the issuance of motor vehicle insurance, 
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 for all motor vehicle insurance 
issued in a particular State, the insurer must report about its 
operations in that State.
    As provided 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 establishing Part 544 (52 FR 
59, January 2, 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(e)(1) and (2). 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.
    Conversely, NHTSA may not exempt a self insurer solely based on 
meeting the definition of insurer as defined in Section 33112(b)(1).
    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 the relatively numerous self-
insurers which are exempted. NHTSA updates

[[Page 41986]]

Appendix C based primarily on information from the publications 
Automotive Fleet Magazine and Business Travel News.

Notice of Proposed Rulemaking

(1)  Insurers of Passenger Motor Vehicles

    On April 8, 1996, NHTSA published a notice of proposed rulemaking 
(NPRM) to update the list of insurers in Appendices A, B, and C 
required to file reports (61 FR 15443). Based on the 1993 calendar year 
market share data provided by A.M. Best, NHTSA proposed to amend the 
listing in Appendix A of insurers which must report because each had 
written 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, was proposed to be removed from 
Appendix A. Two companies, Allmerica Property and Casualty Companies 
and Metropolitan Group, that were not listed in Appendix A, were 
proposed to be added.
    Each of the 19 insurers listed in Appendix A of this notice is 
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 are required to submit reports on each subsequent 
October 25 for the calendar year ending slightly less than 3 years 
before.
    Appendix B lists those insurers that are required to report for 
particular States for the 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 was proposed that one company, 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 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 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 Business 
Travel News for 1993, the most recent year that data are available, 
NHTSA proposed several changes in Appendix C. Based on the data 
reported in the above mentioned publications, NHTSA proposed that the 
American International Rent-A-Car Corp./ANSA be removed from Appendix 
C. The agency also proposed 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 the 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 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. This final rule amends part 544 to reflect the changed statutory 
authority.

Public Comments and Final Determination

    In response to the NPRM, the agency received no comments. 
Accordingly, this final rule adopts the proposed changes to Appendices 
A, B, and C.

Regulatory Impacts

(1)  Costs and Other Impacts

    This notice has not been reviewed under Executive Order 12866. 
NHTSA has considered the impact of this final rule and has determined 
the action not to be ``significant'' within the meaning of the 
Department of Transportation's regulatory policy and procedures. This 
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 expressly required to file reports.
    NHTSA does not believe that this 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 $50,000 for any insurer that is added to 
Appendix A, about $20,000 for any insurer added to Appendix B, and 
about $5,770 for any insurer added to Appendix C. In this final rule, 
for Appendix A, the agency removed one insurer and added two insurers; 
for Appendix B, the agency added one insurer; and for Appendix C, the 
agency removed one company and included four additional companies. The 
agency therefore estimates that the net effect of this final rule will 
be a cost increase to insurers, as a group, of less than $100,000.
    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 final 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 final 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,

[[Page 41987]]

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 this final 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 final rule and determined 
that it would not have a significant impact on the quality of the human 
environment.

(6)  Civil Justice Reform

    This final rule does not have any retroactive effect, and it does 
not preempt any State law, 49 U.S.C. 33117 provides that judicial 
review of this rule may be obtained pursuant to 49 U.S.C. 32909, 
Section 32909 does not require submission of a petition for 
reconsideration or other administrative proceedings before parties may 
file suit in court.

List of Subjects in 49 CFR Part 544

    Crime, Insurance companies, Motor vehicles, Reporting and 
recordkeeping requirements.

    In consideration of the foregoing, 49 CFR Part 544 is amended as 
follows:

PART 544--[AMENDED]

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

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

    2. Section 544.2  Purpose is 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 is revised to read as 
follows:


Sec. 544.4  Definitions.

    (a) Statutory terms. All terms defined in 49 U.S.C. 33101 and 33112 
are used in accordance with their statutory meanings unless otherwise 
defined in paragraph (b) of this section.
* * * * *
    4. Paragraph (a) of Sec. 544.5 is revised to read as follows:


Sec. 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 is 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\
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    \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
Safeco Insurance Companies
Progressive Group
Prudential of America Group State Farm Group
Travelers Insurance Group
USAA Group

    6. Appendix B to Part 544 is 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\
Southern Farm Bureau Casualty Group (Arkansas, Mississippi)
Tennessee Farmers Companies (Tennessee)

    7. Appendix C to Part 544 is 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.
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    Issued on: August 7, 1996.
Barry Felrice,
Associate Administrator for Safety Performance Standards.
[FR Doc. 96-20569 Filed 8-12-96; 8:45 am]
BILLING CODE 4910-59-P