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| SPONSOR: | Martinez | DATE TYPED: | 01/30/01 | HB | 117 | ||
| SHORT TITLE: | Certified Motor Vehicle Liability Policy | SB | |||||
| ANALYST: | Rael | ||||||
| Subsequent
Years Impact |
Recurring
or Non-Rec |
Fund
Affected | ||
| FY01 | FY02 | |||
| See Narrative | Recurring | General Fund | ||
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SOURCES OF INFORMATION
LFC Files
SUMMARY
Synopsis of Bill
This bill creates a new section of the Mandatory Financial Responsibility Act to mandate coverage for both permissive drivers of an insured car and an insured driver of any other car not owned by him. The bill creates policy limits of $25,000 for bodily injury or death per person; $50,000 for bodily injury or death for two or more persons per accident; and $10,000 for property damage.
The following provisions apply to the policy: 1) liability is absolute and cannot be canceled after the occurence of injury or damage; 2) satisfaction of any judgment by the insured shall not be a condition of payment by the insurance company; 3) settlement may be made in good faith; 4) the policy, application and any rider or endorsement that does not conflict with teh act shall constitute the entire contract between the parties.
A policy may be endorsed to eliminate a named driver.
Significant Issues
The bill adds sections to the Mandatory Financial Responsibility Act to require insurance coverage for both the vehicle and the owner, even when the vehicle is driven by another person with the permission of the owner and when the owner is driving another vehicle not owned by him.
FISCAL IMPLICATIONS
While this bill appears to have no impact on the actual policies and practices of insurance companies in New Mexico, it may be read to expand mandatory financial responsibility. If New Mexico drivers are required to assume financial responsibility for an expanded articulation of situations, we might expect that a larger number of accidents will be covered by insurance. This in turn may decrease the necessity of state medical related expenditures for indigent people involved in accidents.
FAR/sb:prr