[Federal Register Volume 63, Number 85 (Monday, May 4, 1998)]
[Proposed Rules]
[Pages 24519-24522]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-11781]
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DEPARTMENT OF TRANSPORTATION
National Highway Traffic Safety Administration
49 CFR Part 544
[Docket No. 98-001; Notice 01]
RIN 2127-AH05
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 1995 calendar
year not later than October 25, 1998. 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 July 6, 1998. If this rule is made final, insurers
listed in the appendices would be required to submit reports beginning
with the one due October 25, 1998.
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 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,
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 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 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 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 a 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:
[[Page 24520]]
(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 those 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 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 1995 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 1 percent of the motor vehicle
insurance premiums on a national basis. The list was last amended in a
notice published on June 23, 1997 (See 62 FR 33754). One company,
Metropolitan Group, included in the June 1997 listing, is proposed to
be removed from appendix A. Three companies, American Financial Group,
Erie Insurance Company, and Zurich Insurance Group-U.S., are proposed
to be added.
Each of the 20 insurers listed in appendix A of this notice would
be required to file a report not later than October 25, 1998, setting
forth the information required by part 544 for each State in which it
did business in the 1995 calendar year. As long as those 20 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 1995, because each insurer had
a 10 percent or a greater market share of motor vehicle premiums in
those States. Based on the 1995 calendar year A.M. Best data for market
shares, it is proposed that Integon Corporate Group, reporting on its
activities in the State of North Carolina be removed from appendix B.
Two companies, Allmerica P & C Companies and Island Insurance, that
were not listed in appendix B, are proposed to be added.
The 12 insurers listed in appendix B of this notice would be
required to report on their calendar year 1995 activities in every
State in which they had a 10 percent or a greater market share. These
reports must be filed no later than October 25, 1998, 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 Business
Travel News for 1995, the most recent year for which data are
available, NHTSA proposes 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 five rental and leasing companies,
Associates Leasing Inc., Enterprise-Rent-A-Car, GE Capital Fleet
Services, PHH Vehicle Management Services, and Wheels, Inc., be
included in appendix C. Accordingly, each of the 20 companies
(including franchisees and licensees) listed in this notice in appendix
C would be required to file reports for calendar year 1995 no later
than October 25, 1998, and set forth the information required by part
544. As long as those 20 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.
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 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. The cost estimates in the
1987 final regulatory evaluation were adjusted for inflation, using the
Bureau of Labor Statistics Consumer Price Index for 1997. The agency
estimates that the cost of compliance will be about $70,500 for any
insurer that is added to appendix A, about $28,200 for any insurer
added to appendix B, and about $10,956 for any insurer added to
appendix C. If this proposed rule is made final, for appendix A, the
agency would add three insurers and remove one insurer; for appendix B,
the agency would remove one and add two insurers; and for appendix C,
the agency would add five 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 $223,980.
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, SW., 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
[[Page 24521]]
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 was assigned OMB Control Number 2127-0547 (``Insurer
Reporting Requirements'') and was approved for use through July 31,
2000.
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 1 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 insurer too large
to meet 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 two 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, two 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 one
copy from which the purportedly confidential information has been
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 continue to read as
follows:
Authority: 49 U.S.C. 33112; delegation of authority at 49 CFR
1.50.
2. Paragraph (a) of Sec. 544.5 would be 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, 1998 shall
contain the required information for the 1995 calendar year).
* * * * *
3. 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
Allstate Insurance Group
American Family Group
American Financial Group \1\
American International Group
California State Auto Association
CNA Insurance Group
Erie Insurance Group \1\
Farmers Insurance Group
GEICO Corporation Group
ITT Hartford Insurance Group
Liberty Mutual Group
Nationwide Group
Progressive Group
Prudential of America Group
Safeco Insurance Companies
State Farm Group
Travelers Insurance Group
USAA Group
Zurich Insurance Group-U.S. \1\
4. 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)
Allmerica P & C Companies (Michigan) \1\
Arbella Mutual Insurance (Massachusetts)
Auto Club of Michigan Group (Michigan)
Commerce Group, Inc. (Massachusetts)
Commercial Union Insurance Companies (Maine)
Concord Group Insurance Companies (Vermont)
Island Insurance Group (Hawaii) \1\
Kentucky Farm Bureau Group (Kentucky)
Nodak Mutual Insurance Company (North Dakota)
Southern Farm Bureau Group (Arkansas, Mississippi)
Tennessee Farmers Companies (Tennessee)
5. 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.
ARI (Automotive Rentals, Inc.)
Associates Leasing Inc.1
A T & T Automotive Services, Inc.
Avis, Inc.
Budget Rent-A-Car Corporation
[[Page 24522]]
Citicorp Bankers Leasing Corporation
Dollar Rent-A-Car Systems, Inc.
Donlen Corporation
Enterprise Rent-A-Car \1\
GE Capital Fleet Services \1\
Hertz Rent-A-Car Division (subsidiary of Hertz Corporation)
Lease Plan USA, Inc.
National Car Rental System, Inc.
Penske Truck Leasing Company
PHH Vehicle Management Services \1\
Ryder System, Inc. (Both rental and leasing operations)
U-Haul International, Inc. (Subsidiary of AMERCO)
USL Capital Fleet Services
Wheels Inc.\1\
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\1\ Indicates a newly listed company which must file a report
beginning with the report due on October 25, 1998.
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Issued on: April 29, 1998.
L. Robert Shelton,
Associate Administrator for Safety Performance Standards.
[FR Doc. 98-11781 Filed 5-1-98; 8:45 am]
BILLING CODE 4910-59-P