[Federal Register Volume 68, Number 55 (Friday, March 21, 2003)]
[Proposed Rules]
[Pages 13887-13891]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 03-5629]


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DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety Administration

49 CFR Part 544

[Docket No.: NHTSA-2003-14372]
RIN 2127-AJ01


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 revise Appendices A, B, and C of 49 
CFR part 544, insurer reporting requirements. The appendices list those 
passenger motor vehicle insurers that are required to file reports on 
their motor vehicle theft loss experiences. An insurer included in any 
of these appendices would be required to file three copies of its 
report for the 2000 calendar year before October 25, 2003. 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 May 20, 2003. Insurers 
listed in the appendices are required to submit reports on or before 
October 25, 2003.

ADDRESSES: Comments on this proposed rule must refer to the docket 
number referenced in the heading of this notice. Submit your comments 
in writing to: Docket Section, NHTSA, Room 5109, 400 Seventh Street, 
SW., Washington, DC 20590. You may also submit written comments to the 
docket on a computer diskette. Comments may also be submitted to the 
docket electronically by logging onto the Dockets Management System Web 
site at http://dms.dot.gov. You may visit the Docket

[[Page 13888]]

from 10 a.m. to 5 p.m., Monday through Friday.

FOR FURTHER INFORMATION CONTACT: Ms. Carlita R. Ballard, Office of 
Planning and Consumer Standards, NHTSA, 400 Seventh Street, SW., 
Washington, DC 20590, by electronic mail [email protected]. Ms. 
Ballard's telephone number is (202) 366-0846. Her fax number is (202) 
493-2290.

SUPPLEMENTARY INFORMATION:

I. 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) 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) 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 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, 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.

II. 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 July 16, 2002 
(67 FR 46608). Based on the 2000 calendar year data market shares from 
A.M. Best, we propose to remove Farmers Insurance Group and St. Paul 
Companies from Appendix A and to add Zurich/Farmers Group to Appendix 
A.
    Each of the 19 insurers listed in Appendix A is required to file a 
report before October 25, 2003, setting forth the information required 
by part 544 for each State in which it did business in the 2000 
calendar year. As long as these 19 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 2000, because each insurer had a 10 percent or 
greater market share of motor vehicle premiums in those States. Based 
on the 2000 calendar year data for market shares from A.M. Best, we 
propose no changes to Appendix B.
    The eight insurers listed in Appendix B are required to report on 
their calendar year 2000 activities in every State where they had a 10 
percent or greater market share. These reports must be filed by October 
25, 2003, and set forth the information required by part 544. As long 
as these eight insurers

[[Page 13889]]

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 2000, NHTSA proposes to remove Ford Rent-A-Car System 
from Appendix C and to add Thrifty Rental Car System Inc. and Ryder TRS 
to Appendix C. Each of the 18 companies (including franchisees and 
licensees) listed in Appendix C would be required to file reports for 
calendar year 2000 no later than October 25, 2003, and set forth the 
information required by part 544. As long as those 18 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.

III. 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 2003 (see http://www.bls.gov/cpi), 
the cost estimates in the 1987 final regulatory evaluation were 
adjusted for inflation. The agency estimates that the cost of 
compliance is $86,100 for any insurer added to Appendix A, $34,440 for 
any insurer added to Appendix B, and $9,936 for any insurer added to 
Appendix C. If this proposed rule is made final, for Appendix A, the 
agency would remove two companies and add one company; for Appendix B, 
the agency would propose no change; and for Appendix C, the agency 
would remove one company and add two companies. The agency estimates 
that the net effect of this proposal, if made final, would be a cost 
decrease to insurers, as a group of approximately $76,164.
    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 August 31, 2003, 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 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.

6. Regulation Identifier Number (RIN)

    The Department of Transportation assigns a regulation identifier 
number (RIN) to each regulatory action listed in the Unified Agenda of 
Federal Regulations. The Regulatory Information Service Center 
publishes the Unified Agenda in April and October of each year. You may 
use the RIN contained in the heading, at the beginning, of this 
document to find this action in the Unified Agenda.

7. Plain Language

    Executive Order 12866 and the President's memorandum of June 1, 
1998, require each agency to write all rules in plain language. 
Application of the principles of plain language includes consideration 
of the following questions:
    [sbull] Have we organized the material to suit the public's needs?
    [sbull] Are the requirements in the proposal clearly stated?
    [sbull] Does the proposal contain technical language or jargon that 
is not clear?
    [sbull] Would a different format (grouping and order of sections, 
use of headings, paragraphing) make the rule easier to understand?
    [sbull] Would more (but shorter) sections be better?
    [sbull] Could we improve clarity by adding tables, lists, or 
diagrams?
    [sbull] What else could we do to make the proposal easier to 
understand?
    If you have any responses to these questions, you can forward them 
to me several ways:
    a. Mail: Carlita R. Ballard, Office of Planning and Consumer 
Standards, NHTSA, 400 Seventh Street, SW., Washington, DC 20590;
    b. E-mail: [email protected]; or
    c. Fax: (202) 493-2290.

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IV. Comments

Submission of Comments

1. How Can I Influence NHTSA's Thinking on This Proposed Rule?
    In developing our rules, NHTSA tries to address the concerns of all 
our stakeholders. Your comments will help us improve this rule. We 
invite you to provide views on our proposal, new data, a discussion of 
the effects of this proposal on you, or other relevant information. We 
welcome your views on all aspects of this proposed rule. Your comments 
will be most effective if you follow the suggestions below:
    [sbull] Explain your views and reasoning clearly.
    [sbull] Provide solid technical and cost data to support your 
views.
    [sbull] If you estimate potential costs, explain how you derived 
the estimate.
    [sbull] Provide specific examples to illustrate your concerns.
    [sbull] Offer specific alternatives.
    [sbull] Include the name, date, and docket number with your 
comments.
2. How Do I Prepare and Submit Comments?
    Your comments must be written in English. To ensure that your 
comments are correctly filed in the Docket, please include the docket 
number of this document in your comments.
    Your comments must not exceed 15 pages long (49 CFR 553.21). We 
established this limit to encourage you to write your primary comments 
concisely. You may attach necessary documents to your comments. We have 
no limit on the attachments' length.
    Please submit two copies of your comments, including the 
attachments, to Docket Management at the address given above under 
ADDRESSES.
    Comments may also be submitted to the docket electronically by 
logging onto the Dockets Management System Web site at http://dms.dot.gov. Click on ``Help & Information'' or ``Help/Info'' to obtain 
instructions for filling the document electronically.
3. How Can I Be Sure That My Comments Were Received?
    If you wish Docket Management to notify you, upon its receipt of 
your comments, enclose a self-addressed, stamped postcard in the 
envelope containing your comments. Upon receiving your comments, Docket 
Management will mail the postcard.
4. How Do I Submit Confidential Business Information?
    If you wish to submit any information under a confidentiality 
claim, you should submit three copies of your complete submission, 
including the information you claim as confidential business 
information, to the Chief Counsel, Office of Chief Counsel, NHTSA, 400 
Seventh Street, SW., Washington, DC 20590. In addition, you should 
submit two copies, from which you have deleted the claimed confidential 
business information, to Docket Management at the address given above 
under ADDRESSES. When you send a comment containing information claimed 
to be confidential business information, you should include a cover 
letter addressing the information specified in our confidential 
business information regulation (49 CFR part 512).
5. Will the Agency Consider Late Comments?
    NHTSA will consider all comments that Docket Management receives 
before the close of business on the comment closing date indicated 
above under DATES. To the extent possible, we will also consider 
comments that Docket Management receives after that date. If Docket 
Management receives a comment too late for us to consider, in 
developing a final rule (assuming that one is issued), we will consider 
that comment as an informal suggestion for future rulemaking action.
6. How Can I Read the Comments Submitted by Other People?
    You may read the comments received by Docket Management at the 
address given above under ADDRESSES. The hours of the Docket are 
indicated above, in the same location.
    You may also see the comments on the Internet. To read the comments 
on the Internet, take the following steps:
    1. Go to the Docket Management System (DMS) Web page of the 
Department of Transportation (http://dms.dot.gov/).
    2. On that page, click on ``search.''
    3. On the next page (http://dms.dot.gov/search/), type in the four-
digit docket number shown at the beginning of this document. Example: 
If the docket number was ``NHTSA 1998-1234,'' you would type ``1234.'' 
After typing the docket number, click on ``search.''
    4. On the next page, which contains docket summary information for 
the docket you selected, click on the desired comments. The ``pdf'' 
versions of the documents are word searchable.

V. Conclusion

    Based on the foregoing, we are proposing to revise Appendices A, B, 
and C of 49 CFR 544, insurer reporting requirements.

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 continues 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 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 3 years previous to the year in which the report is 
filed (e.g., the report due by October 25, 2003, will contain the 
required information for the 2000 calendar year).
* * * * *
    3. Appendix A to part 544 is proposed to be revised 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 International Group
California State Auto Association
CGU Group
CNA Insurance Companies
Erie Insurance Group
Berkshire Hathaway/GEICO Corporation Group
Great American P & C Group
Hartford Insurance Group
Liberty Mutual Insurance Companies
Metropolitan Life Auto & Home Group
Nationwide Group
Progressive Group
SAFECO Insurance Companies
State Farm Group
Travelers/Citigroup Company
USAA Group
Zurich/Farmers Group \1\

    4. Appendix B to part 544 is proposed to be revised as follows:

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

Alfa Insurance Group (Alabama)
Arbella Mutual Insurance (Massachusetts)
Auto Club (Michigan)

[[Page 13891]]

Commerce Group, Inc. (Massachusetts)
Kentucky Farm Bureau Group (Kentucky)
New Jersey Manufacturers Group (New Jersey)
Southern Farm Bureau Group (Arkansas, Mississippi)
Tennessee Farmers Companies (Tennessee)

    5. Appendix C to part 544 is proposed to be revised 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 Resources International)
Associates Leasing Inc.
Avis, Rent-A-Car, Inc.
Budget Rent-A-Car Corporation
Consolidated Service Corporation
Dollar Rent-A-Car Systems, Inc.
Donlen Corporation
Enterprise Rent-A-Car
GE Capital Fleet Services
Hertz Rent-A-Car Division (subsidiary of The Hertz Corporation)
Lease Plan USA, Inc.
National Car Rental System, Inc.
PHH Vehicle Management Services
Ryder TRS \1\
Thrifty Rental Car System Inc.\1\
U-Haul International, Inc. (Subsidiary of AMERCO)
Wheels Inc.
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    \1\ Indicates a newly listed company which must file a report 
beginning with the report due October 25, 2003.

    Issued on: March 4, 2003.
Stephen R. Kratzke,
Associate Administrator for Rulemaking.
[FR Doc. 03-5629 Filed 3-20-03; 8:45 am]
BILLING CODE 4910-59-P