[Federal Register Volume 70, Number 192 (Wednesday, October 5, 2005)]
[Rules and Regulations]
[Pages 58065-58066]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-19946]


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DEPARTMENT OF TRANSPORTATION

Federal Motor Carrier Safety Administration

49 CFR Part 387

[Docket No. FMCSA-2005-22470]


Regulatory Guidance for Forms Used To Establish Minimum Levels of 
Financial Responsibility of Motor Carriers

AGENCY: Federal Motor Carrier Safety Administration (FMCSA), DOT.

ACTION: Regulatory guidance.

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SUMMARY: This document presents interpretive guidance material for the 
Federal Motor Carrier Safety Regulations (FMCSRs). FMCSA issues new 
regulatory guidance for Forms MCS-90, MCS-90B, MCS-82, and MCS-82B used 
to establish minimum levels of financial responsibility of motor 
carriers. The questions and answers are applicable to motor carrier 
operations on a national basis. This guidance will provide the motor 
carrier and financial services industries and Federal, State, and local 
law enforcement officials with a clearer understanding of the 
applicability in particular situations of Forms MCS-90, MCS-90B, MCS-
82, and MCS-82B contained in the FMCSRs.

EFFECTIVE DATE: October 5, 2005.

FOR FURTHER INFORMATION CONTACT: Ms. Joy Dunlap, Chief, Commercial 
Enforcement Division, Office of Enforcement and Compliance (MC-ECC), 
Federal Motor Carrier Safety Administration, 400 Seventh Street. SW., 
Washington, DC 20590. Phone 202-385-2400. Office hours are from 7:45 
a.m. to 4:15 p.m., e.t., Monday through Friday, except Federal legal 
holidays.

SUPPLEMENTARY INFORMATION:

Basis for the Notice

    FMCSA received a petition for rulemaking from several insurance 
companies and the American Insurance Association to amend Form MCS-90, 
Endorsement for Motor Carrier Policies

[[Page 58066]]

of Insurance for Public Liability, to incorporate several changes, most 
of which were suggested to clarify the meaning of Form MCS-90. The 
Trucking Industry Defense Association (TIDA) filed a brief in support 
of the petition. A copy of the petition, amendments to the petition and 
the TIDA brief are in the docket identified in the heading of this 
document. The petitioners contended changes were necessary in light of 
Federal and State court decisions \1\ that they claimed misconstrued 
Form MCS-90 to require insurance companies to pay damages for negligent 
operation of a vehicle owned by the insured motor carrier but not 
covered by its insurance policy, even when no judgment had been 
obtained against the insured motor carrier. The Petitioners' primary 
concern was to have the agency clarify that the word ``insured'' in the 
Form MCS-90 means ``named insured.''
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    \1\ John Deere Insurance Co. v. Nueva, 229 F.3d 853 (9th Cir. 
2000); Lynch v. Yob, 95 Ohio St. 3d 441, 768 NE. 2d 1158 (2002); 
Pierre v. Providence Wash. Ins. Co., 286 A.D.2d 139, 730 N.Y.S.2d 
550 (2001); and Madere v. National Union Fire Ins. Co. of 
Pittsburgh, 2000 U.S. Dist. LEXIS 15994 (E.D. La. 2000).
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    FMCSA has denied the petition for rulemaking. However, the agency 
stated petitioners' concerns could be adequately addressed without 
rulemaking through formal agency guidance to be published in the 
Federal Register. A copy of the letter denying the petition is in the 
docket identified in the heading of this document.

FMCSA Authorities Over Motor Carrier Financial Responsibility 
Requirements

    Section 30 of the Motor Carrier Act of 1980 (Pub. L. 96-296, July 
1, 1980, 94 Stat. 793, at 820), codified at 49 U.S.C. 31139, 
established minimum levels of financial responsibility for for-hire 
motor carriers of property involved in interstate or foreign 
transportation and for the transportation of hazardous materials in 
intrastate and interstate commerce.
    Section 18 of the Bus Regulatory Reform Act of 1982 (Pub. L. 97-
261, September 20, 1982, 96 Stat. 1102), codified at 49 U.S.C. 31138, 
established minimum levels of financial responsibility covering public 
liability and property damage for the transportation of passengers by 
for-hire motor carriers in interstate or foreign commerce.
    The financial responsibility provisions of the Motor Carrier Act of 
1980 and the Bus Regulatory Reform Act of 1982 were intended to create 
incentives for the motor carrier industry to focus on the safety 
aspects of highway transportation and to assure the general public that 
a motor carrier maintains an adequate level of financial responsibility 
sufficient to satisfy claims covering public liability, property damage 
liability and, in the case of transporters of hazardous materials, 
environmental restoration liability.
    The Administrator of FMCSA has been delegated authority, under 49 
CFR 1.73(f), to carry out the functions vested in the Secretary of 
Transportation relating to financial responsibility requirements for 
motor carriers, brokers and freight forwarders. Such functions include 
issuing regulations implementing 49 U.S.C. 31138 and 31139 and 
providing guidance regarding statutory or regulatory requirements.
    This document provides regulatory guidance to the petitioners and 
the public with respect to the proper interpretation of Form MCS-90. 
FMCSA is including Forms MCS-90B, MCS-82, and MCS-82B in this 
regulatory guidance as well, because the same issue may arise with 
respect to these forms. Forms MCS-90, MCS-90B, MCS-82, and MCS-82B are 
not intended, and do not purport, to require insurance companies or 
sureties to satisfy a judgment against any party other than the motor 
carrier named in the endorsement or its fiduciary.
    Members of the motor carrier industry and other interested parties 
may also access the guidance in this document through the FMCSA's 
Internet site at http://www.fmcsa.dot.gov.
    Specific questions addressing any of the interpretive material 
published in this document should be directed to the contact person 
listed earlier under FOR FURTHER INFORMATION CONTACT, or the FMCSA 
Division Office in each State.

Regulatory Guidance

PART 387--MINIMUM LEVELS OF FINANCIAL RESPONSIBILITY FOR MOTOR 
CARRIERS

Sections Interpreted

Section 387.15 Forms

    Question: Does the term ``insured,'' as used on Form MCS-90, 
Endorsement for Motor Carrier Policies of Insurance for Public 
Liability, or ``Principal'', as used on Form MCS-82, Motor Carrier 
Liability Surety Bond, mean the motor carrier named in the endorsement 
or surety bond?
    Guidance: Yes. Under 49 CFR 387.5, ``insured and principal'' is 
defined as ``the motor carrier named in the policy of insurance, surety 
bond, endorsement, or notice of cancellation, and also the fiduciary of 
such motor carrier.'' Form MCS-90 and Form MCS-82 are not intended, and 
do not purport, to require a motor carrier's insurer or surety to 
satisfy a judgment against any party other than the carrier named in 
the endorsement or surety bond or its fiduciary.

Section 387.39 Forms

    Question: Does the term ``insured,'' as used on Form MCS-90B, 
Endorsement for Motor Carrier Policies of Insurance for Public 
Liability, or ``Principal'', as used on Form MCS-82B, Motor Carrier 
Public Liability Surety Bond, mean the motor carrier named in the 
endorsement or surety bond?
    Guidance: Yes. Under 49 CFR 387.29, ``insured and principal'' is 
defined as ``the motor carrier named in the policy of insurance, surety 
bond, endorsement, or notice of cancellation, and also the fiduciary of 
such motor carrier.'' Form MCS-90B and Form MCS-82B are not intended, 
and do not purport, to require a motor carrier's insurer or surety to 
satisfy a judgment against any party other than the carrier named in 
the endorsement or surety bond or its fiduciary.

    Issued on: September 28, 2005.
Annette M. Sandberg,
Administrator.
[FR Doc. 05-19946 Filed 10-4-05; 8:45 am]
BILLING CODE 4910-EX-P