[Federal Register Volume 65, Number 68 (Friday, April 7, 2000)]
[Proposed Rules]
[Pages 18267-18270]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-8663]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 544

[Docket No.: 2000-001; Notice 01]
RIN 2127-AH77


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: This document proposes to republish, without change, 2 lists 
of those passenger motor vehicle insurers that are required to file 
reports on their motor vehicle theft loss experiences and to amend a 
third list. An insurer included in any of these lists would be required 
to file a report for the 1997 calendar year before October 25, 2000. If 
the passenger motor vehicle insurers remain listed, they must submit 
reports by each subsequent October 25.

DATES: Comments must be submitted not later than June 6, 2000.

ADDRESSES: Comments on this proposed rule must refer to the docket 
number referenced in the heading of this notice and submit them 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: Dr. Henrietta L. Spinner, Office of 
Planning and Consumer Programs, NHTSA, 400 Seventh Street, SW, 
Washington, DC 20590. Dr. Spinner's telephone number is (202) 366-4802. 
Her fax number is (202) 493-2290.

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 
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 exempted 
certain 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.
    In the final rule establishing the insurer reports requirement (52 
FR 59; January 2, 1987), 49 CFR part 544, NHTSA exercised its exemption 
authority by listing in Appendix A each insurer that 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 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 it would update Appendices A and B annually. NHTSA 
updates the appendices based on data voluntarily provided by insurance 
companies to A.M. Best,

[[Page 18268]]

which A.M. Best publishes in its State/Line Report 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 grants 
exemptions to self-insurers, i.e., any person who has a fleet of 20 or 
more motor vehicles (other than any governmental entity) used for 
rental or lease whose vehicles 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 the largest companies' 
reports sufficiently represent the theft experience of rental and 
leasing companies. NHTSA concluded that smaller rental and leasing 
companies' reports do not significantly contribute to carrying out 
NHTSA's statutory obligations and that exempting such companies will 
relieve an unnecessary burden on them. As a result of the June 1990 
final rule, the agency added Appendix C, consisting of an annually 
updated list of the self-insurers subject to Part 544. Following the 
same approach as in Appendix A, NHTSA included, in Appendix C, each of 
the self-insurers subject to reporting instead of the self-insurers 
which are exempted. NHTSA updates Appendix C based primarily on 
information from 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 October 25 of each year. Thus, any insurer listed 
in the appendices must file a report by October 25, and by each 
succeeding October 25, absent an amendment removing the insurer's name 
from the appendices.

Proposal

1. Insurers of Passenger Motor Vehicles

    Appendix A lists insurers that must report because each had 1 
percent of the motor vehicle insurance premiums on a national basis. 
The list was last amended in a final rule published on October 25, 1999 
(See 64 FR 57393). Based on the 1997 calendar year data from A.M. Best, 
we are proposing to reissue appendix A without change.
    Each of the 18 insurers listed in Appendix A is required to file a 
report before October 25, 2000, setting forth the information required 
by part 544 for each State in which it did business in the 1997 
calendar year. As long as these 18 insurers remain listed, they will be 
required to submit reports by each subsequent October 25 for the 
calendar year ending slightly less than 3 years before.
    Appendix B lists insurers required to report for particular States 
for calendar year 1997, because each insurer had a 10 percent or a 
greater market share of motor vehicle premiums in those States. Based 
on the 1997 calendar year data for market shares from A.M. Best, we are 
proposing to reissue Appendix B without change.
    The 11 insurers listed in appendix B are required to report on 
their calendar year 1997 activities in every State where they had a 10 
percent or a greater market share. These reports must be filed by 
October 25, 2000, and set forth the information required by Part 544. 
As long as these 11 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

    Appendix C lists rental and leasing companies required to file 
reports. Based on information in Automotive Fleet Magazine and Business 
Travel News for 1997, NHTSA proposes to remove Penske Truck Leasing 
Company from Appendix C and to add Ford-Rent-A-Car System to Appendix 
C. Each of the 19 companies (including franchisees and licensees) 
listed in Appendix C would be required to file reports for calendar 
year 1997 no later than October 25, 2000, and set forth the information 
required by Part 544. As long as those 19 companies remain listed, they 
would be required to submit reports 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 determined 
that the action is not ``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 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 Bureau of Labor 
Statistics Consumer Price Index for 1999, the cost estimates in the 
1987 final regulatory evaluation were adjusted for inflation. The 
agency estimates that the cost of compliance is $83,300 for any insurer 
added to Appendix A, $33,320 for any insurer added to Appendix B, and 
$9,613 for any insurer added to Appendix C. If this proposed rule is 
made final, for Appendices A and B, the agency would make no changes; 
for Appendix C, the agency would remove one company and add one 
company. The agency therefore estimates that the net effect of this 
proposal, if made final, would be no cost to insurers as a group.
    Interested persons may wish to examine the 1987 final regulatory 
evaluation. Copies of that evaluation were 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 were 
submitted 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 is assigned OMB Control 
Number 2127-0547 (``Insurer Reporting Requirements'') and approved for 
use through July 31, 2000, and the agency will seek to extend the 
approval afterwards.

3. Regulatory Flexibility Act

    The agency 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

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will 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 for Appendices A, B, or C are 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 according to 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 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 
regarding the final rule will be considered as suggestions for further 
rulemaking action. Comments on the proposal are available for 
inspection in the docket. NHTSA will continue to file relevant 
information, as it becomes available in the docket after the closing 
date. It is recommended that interested persons continue to examine the 
docket for new material.
    Those persons wanting receipt of their comments in the rule 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 is proposed to be revised 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 is proposed to 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 before 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, 2000 will contain the 
required information for the 1997 calendar year).
* * * * *
    3. Appendix A to Part 544 is proposed to be republished 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

Allstate Insurance Group
American Family Insurance Group
American Financial Group
American International Group
California State Auto Association
CNA Insurance Group
Erie Insurance Group
Farmers Insurance Group
Berkshire Hathaway/GEICO Corporation Group
Hartford Insurance Group
Liberty Mutual Group
Nationwide Group
Progressive Group
Prudential of America Group
State Farm Group
Travelers PC Group
USAA Group
Zurich Insurance Group-U.S.

    4. Appendix B to Part 544 is proposed to 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)
Arbella Mutual Insurance (Massachusetts)
Auto Club of Michigan Group (Michigan)
Commerce Group, Inc. (Massachusetts)
Commercial Union Insurance Companies (Maine)
Concord Group Insurance Companies (Vermont)
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 is proposed to 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.
AT&T Automotive Services, Inc.
Avis, Inc.
Budget Rent-A-Car Corporation
Dollar Rent-A-Car Systems, Inc.
Donlen Corporation
Enterprise Rent-A-Car
Ford Rent-A-Car-System \1\
GE Capital Fleet Services
Hertz Rent-A-Car Division (subsidiary of Hertz Corporation)
Lease Plan USA, Inc.

[[Page 18270]]

National Car Rental System, Inc.
PHH Vehicle Management Services
Ryder System, Inc. (Both rental and leasing operations)
U-Haul International, Inc. (Subsidiary of AMERCO)
USL Capital Fleet Services
Wheels Inc.
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    \1\ Indicates a newly listed company which must file a report 
beginning with the report due October 25, 2000.

    Issued on: April 4, 2000.
Stephen R. Kratzke,
Acting Associate Administrator for Safety Performance Standards.
[FR Doc. 00-8663 Filed 4-6-00; 8:45 am]
BILLING CODE 4910-59-P