S-1331.2

SENATE BILL 5893

BySenators Hobbs and King

AN ACT Relating to the private vehicle rental act; amending RCW 46.30.020; adding a new chapter to Title 46 RCW; and creating a new section.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

NEW SECTION.  Sec. 1. DEFINITIONS.The definitions in this section apply throughout this chapter unless the context clearly requires otherwise.

(1) "Program rental period" or "rental period" means the period of time when a renter takes possession and control of a vehicle available for private vehicle rental, includes the time when such vehicle is under the control of the program provider, and continues until the following conditions are met:

(a) The vehicle is:

(i) Retrieved by the owner or owner's designee;

(ii) Returned to a location agreed upon by the owner and the renter; or

(iii) Returned to a location designated by the program provider; and

(b) One of the following occurs:

(i) The time period established through the program expires;

(ii) The renter verifiably communicates to the program provider or owner that they deem the rental period terminated; or

(iii) The owner or the program provider takes possession and control of the vehicle.

(2) "Group policy" means an insurance policy issued pursuant to section 4 of this act.

NEW SECTION.  Sec. 2. REQUIREMENTS AND LIMITATIONS FOR PRIVATE VEHICLE RENTAL.(1) No personal passenger motor vehicle insured, or subject to being insured, by its registered owner pursuant to RCW 46.30.020 is or may be classified as a commercial vehicle, for-hire vehicle, permissive use vehicle, taxicab, or livery solely because its registered owner allows it to be used for private vehicle rental, as long as all of the following circumstances apply:

(a) The private vehicle rental is compliant with a personal vehicle rental program as provided for in this chapter;

(b) The owner, or program provider, does not knowingly place the vehicle, or allow the vehicle to be placed, into use as a commercial vehicle, or as a vehicle for hire by a private vehicle renter, while the vehicle is utilized for private vehicle rental; and

(c) The number of personal passenger motor vehicles a single individual, or multiple individuals residing in the same household, has enrolled in any private vehicle rental program, or combination of private vehicle rental programs, does not exceed four.

(2) A personal passenger motor vehicle liability insurance company may cancel or refuse coverage to an owner solely due to the number of vehicles enrolled in private vehicle rental, if the number of vehicles enrolled in any private rental program, or combination of programs, either by the insured, or in combination with other household residents, exceeds four.

(3) A program provider shall, for each vehicle of which it facilitates the rental, do all of the following:

(a) During the rental period for a vehicle engaged in private vehicle rental, procure group insurance coverage for each vehicle and authorized driver of any such vehicle. Such insurance shall, at a minimum, provide for each vehicle:

(i) Liability coverage at least equal to the minimum financial responsibility requirements for personal passenger motor vehicles of the state in which the vehicle is registered; and

(ii) Property and casualty coverage including comprehensive and collision protection, as further described in section 4(4) and (5) of this act;

(b) Provide the registered owner of the vehicle engaged in private vehicle rental with suitable proof of compliance with the insurance requirements of this section and the requirements of RCW 46.30.020, a copy of which shall be maintained in the vehicle by the owner during any time when the vehicle is operated by a renter, or person other than the owner, pursuant to a private vehicle rental program;

(c) Not permit the vehicle to be operated for commercial use or as a vehicle for hire by a renter while engaged in private vehicle rental;

(d) Provide each renter, for each rental transaction under the program, at the time of each rental:

(i) Access to an insurance identification card approved for use by the state in which the vehicle is registered; or other documentation, able to be carried in the vehicle at all times during the rental period, that proves the insurance coverage referred to in (a) of this subsection is in full force and effect; and

(ii) The means, via a toll-free number, email address, or such other form of communication with a law enforcement officer, a representative of the department of licensing, or other officer of the state in which the vehicle is registered or any political subdivision thereof, to confirm in real time that insurance coverage provided for in (a) of this subsection is in effect;

(e) Require that every vehicle made available for private vehicle rental comply with the minimum financial responsibility requirements of the state in which the vehicle is registered;

(f) Require that every vehicle used in a program is a private motor vehicle;

(g) Facilitate the installation, operation, and maintenance of its own signage and computer hardware and software to the extent necessary for the vehicle to be used in the program;

(h) Indemnify and hold harmless the owner for the cost of damage or theft of equipment installed by the program provider under (g) of this subsection for any damage caused to the vehicle by the installation, operation, or maintenance of such equipment;

(i) Collect, maintain, and make available, to any government agency as required by law, at the cost of the program, the owner's primary motor vehicle liability insurer; the renter's primary automobile, excess, or umbrella insurer; and the following information pertaining to incidents that occurred during any rental period:

(i) Verifiable records of the rental period for each vehicle, and, to the extent electronic equipment for monitoring the following information is installed in the vehicle, verifiable electronic records of the time, initial and final locations of the vehicle, and, to the extent mileage is collected, miles driven; and

(ii) In instances where an insurance claim has been filed with a group insurer, any and all information relevant to the claim, including payments by the program provider concerning accidents, damages, and injuries;

(j) Ensure that the owner and renter are given notice prior to the first use or operation of a private motor vehicle pursuant to enrollment in a private vehicle rental program, that:

(i) During the rental period, the owner's insurer may exclude any and all coverage afforded to its policy and such owner's insurer has the right to notify an insured that it has no duty to defend or indemnify any person or organization for liability for any loss that occurs during the rental period; and

(ii) The group policy and physical damage coverage contract may not provide coverage outside of the rental period; and

(k) Comply with all statutory and regulatory obligations for private passenger motor vehicle rental including, but not limited to, compliance with the provisions of RCW 46.63.073.

NEW SECTION.  Sec. 3. LIABILITY PROVISIONS.(1) Notwithstanding any other provision of law or any provision in a private passenger motor vehicle owner's automobile insurance policy, in the event of a loss or injury that occurs during the rental period or while the private motor vehicle is otherwise under the control of a private vehicle rental program provider, the program provider shall be deemed the owner of the vehicle under this title, and such other statutes that may impose liability upon an owner of a private passenger motor vehicle solely based on such ownership as if the program provider were the registered owner of the vehicle. The program provider shall retain such liability irrespective of a lapse in the group policy or any insurance policy under which the program is insured, or whether such liability is covered under the group policy or any insurance policy under which the program is insured.

(2) A program provider's group policy must provide coverage during the rental period for an owner's private motor vehicle.

(3) The insurer or insurers providing group liability insurance to the private vehicle rental program pursuant to section 4(1) of this act and group physical damage insurance to the private vehicle rental program pursuant to section 4(4) of this act assume liability for a claim in which a dispute exists regarding who was in control of the vehicle when the loss occurred giving rise to the claim, and the owner's private passenger motor vehicle insurer shall indemnify the private vehicle rental program's group insurer or insurers, to the extent of its obligation under the applicable insurance policy, if it is determined that the vehicle's owner was in control of the vehicle at the time of the loss. The program shall notify the owner's insurer of any such dispute within ten business days of becoming aware that such a dispute exists.

(4) In the event that the owner of the vehicle or its insurer is named as a defendant in a civil action for a loss or injury that occurs during any time within the rental period, or otherwise under the control of a private vehicle rental program, the program's group liability insurance insurer under section 4(1) of this act has the duty to defend and indemnify the vehicle's owner and the owner's insurer, subject to the provisions of subsection (3) of this section.

(5) Notwithstanding any other provision of law to the contrary, while a private motor vehicle is used by a person other than its owner, pursuant to private vehicle rental facilitated through a private vehicle rental program, all of the following apply:

(a) The insurer of that vehicle may exclude any and all coverage for liability, uninsured, underinsured, collision physical damage, comprehensive physical damage, and first-party benefits that may otherwise be afforded pursuant to its policy; and

(b) The primary and excess insurer or insurers of the owner of the private motor vehicle used in a private vehicle rental program have the right to notify the insured that it has no duty to defend or indemnify any person or organization for liability for any loss that occurs during the rental period of the vehicle in a private vehicle rental program.

(6) No owner's policy of insurance may be canceled, voided, terminated, rescinded, or nonrenewed, solely on the basis that the private motor vehicle has been made available for private vehicle rental pursuant to a private vehicle rental program that is in compliance with the provisions of this section. However:

(a) The provisions of this subsection (6) do not pertain to cancellations in accordance with the provisions of chapter 48.18 RCW;

(b) An insurer may refuse to enroll a vehicle in a usage-based insurance program, where such usage-based insurance program continually monitors usage electronically to determine acceleration, braking, miles driven, and other indicia of driving behavior, if that vehicle is used in a private vehicle rental program under this chapter; and

(c) An insurer may cancel or nonrenew a policy that insures a vehicle used in the private vehicle rental program if that vehicle is enrolled in such a usage-based insurance program. The insurer must immediately offer the insured a new policy with the same coverages and preexisting rates, but without enrollment in the usage-based insurance program.

NEW SECTION.  Sec. 4. GROUP INSURANCE FOR PRIVATE VEHICLE RENTAL PROGRAMS.(1) An insurer which is authorized or eligible to do business in the state may issue, or issue for delivery in this state, a group policy of liability and property and casualty insurance to a private vehicle rental program provider to insure the private vehicle rental program, and the renters, authorized drivers, and occupants of the private motor vehicle, as well as the program provider, its agents, employees, directors, officers, and assigns, provided:

(a) That such policy provides first-party coverage, liability, property, comprehensive, collision, and uninsured and underinsured motorist coverage for the private motor vehicle and its authorized operators and occupants for claims and damages resulting from the use or operation of that vehicle during the rental period;

(b) That such policy is primary with respect to any other insurance available to the owner of the private motor vehicle;

(c) That such policy is secondary with respect to any other insurance available to the renter, authorized or permissive operator, and occupants of the private motor vehicle;

(d) That such insurer complies with the provisions of RCW 46.30.020; and

(e) That for the purposes of group insurance written under this section only, the rates charged by the insurer for group liability insurance as provided for in this section are filed with the insurance commissioner on a file and use basis.

(2) An insurer which issues an insurance policy described in subsection (1) of this section shall issue such policy identifying the private vehicle rental program and program provider as the named insureds; and any such policy must include a provision that provides coverage, without prior notice to the insurer, for all private motor vehicles during the rental period and such policy must further include a provision that the vehicles' renters, authorized or permissive operators, and occupants are included as insureds under the policy to the same extent that they would be insureds under a private passenger motor vehicle policy issued pursuant to chapter 48.22 RCW.

(3) A group policy, as provided for in subsections (1) and (2) of this section, may only be issued in accordance with the provisions of this chapter.

(4) A program provider may contractually assume the risk of physical damage loss to private motor vehicles during the time that the vehicles are in the custody of the private vehicle renter or private vehicle rental program provider.

(a) Such assumption of risk of physical damage loss to the vehicle is not physical damage insurance.

(b) A program provider may offer optional vehicle protection in accordance with the provisions of chapter 48.22 RCW.

(5) An insurer which is authorized or eligible to do business in the state may issue a group policy of physical damage insurance to a private vehicle rental program and to the owners of vehicles participating in that program to insure against physical damage loss to vehicles while the vehicles are in the custody of the private vehicle rental program or private vehicle renter. Such group policy must provide primary coverage for physical damage loss either by collision, comprehensive, or both, to the vehicle while it is in the custody of the private vehicle rental program or a private vehicle renter.

(6) If the group coverage provided for in subsection (5) of this section is placed with an eligible excess line insurer, compliance with the excess line statutes and regulations of this state must be performed with respect to the group as a whole and not with respect to individual group members.

(7) An insurer which issues a group insurance policy described in subsection (5) of this section shall issue such policy identifying the private vehicle rental program as the named insured, and any such policy must include:

(a) A provision that provides primary coverage, without prior notice to the insurer, for all private motor vehicles during the rental period;

(b) A provision that claims will be adjusted pursuant to chapter 48.30 RCW; and

(c) Physical damage coverage for damage or loss to the owner's vehicle incurred during the rental period at a level no less than that of third-party physical damage coverage.

(8) A group policy as provided for in subsections (5), (6), and (7) of this section may only be issued in accordance with the provisions of this section.

Sec. 5. RCW 46.30.020 and 2013 2nd sp.s. c 23 s 20 are each amended to read as follows:

(1)(a) No person may operate a motor vehicle subject to registration under chapter 46.16A RCW in this state unless the person is insured under a motor vehicle liability policy with liability limits of at least the amounts provided in RCW 46.29.090, is self-insured as provided in RCW 46.29.630, is covered by a certificate of deposit in conformance with RCW 46.29.550, or is covered by a liability bond of at least the amounts provided in RCW 46.29.090. Proof of financial responsibility for motor vehicle operation must be provided on the request of a law enforcement officer in the format specified under RCW 46.30.030.

(b) A person who drives a motor vehicle that is required to be registered in another state that requires drivers and owners of vehicles in that state to maintain insurance or financial responsibility shall, when requested by a law enforcement officer, provide evidence of financial responsibility or insurance as is required by the laws of the state in which the vehicle is registered.

(c) When asked to do so by a law enforcement officer, failure to display proof of financial responsibility for motor vehicle operation as specified under RCW 46.30.030 creates a presumption that the person does not have motor vehicle insurance.

(d) Failure to provide proof of motor vehicle insurance is a traffic infraction and is subject to penalties as set by the supreme court under RCW 46.63.110 or community restitution.

(e) For the purposes of this section, when a person uses a portable electronic device to display proof of financial security to a law enforcement officer, the officer may only view the proof of financial security and is otherwise prohibited from viewing any other content on the portable electronic device.

(f) Whenever a person presents a portable electronic device pursuant to this section, that person assumes all liability for any damage to the portable electronic device.

(2) If a person cited for a violation of subsection (1) of this section appears in person before the court or a violations bureau and provides written evidence that at the time the person was cited, he or she was in compliance with the financial responsibility requirements of subsection (1) of this section, the citation shall be dismissed and the court or violations bureau may assess court administrative costs of twenty-five dollars at the time of dismissal. In lieu of personal appearance, a person cited for a violation of subsection (1) of this section may, before the date scheduled for the person's appearance before the court or violations bureau, submit by mail to the court or violations bureau written evidence that at the time the person was cited, he or she was in compliance with the financial responsibility requirements of subsection (1) of this section, in which case the citation shall be dismissed without cost, except that the court or violations bureau may assess court administrative costs of twenty-five dollars at the time of dismissal.

(3) The provisions of this chapter shall not govern:

(a) The operation of a motor vehicle registered under RCW 46.18.220 or 46.18.255, governed by RCW 46.16A.170, or registered with the Washington utilities and transportation commission as common or contract carriers; or

(b) The operation of a motorcycle as defined in RCW 46.04.330, a motor-driven cycle as defined in RCW 46.04.332, a moped as defined in RCW 46.04.304, or a wheeled all-terrain vehicle as defined in RCW 46.09.310.

(4)(a) In the case of a private motor vehicle that is used in connection with a private vehicle rental program, as provided in chapter 46.--- RCW (the new chapter created in section 7 of this act), the insurance requirements set forth in this section are met by a group insurance policy, as specified in section 4 of this act, issued to a program provider and to the private vehicle renters and authorized or permissive drivers of that program for any time that the private motor vehicle is being used in connection with the private vehicle rental program.

(5) RCW 46.29.490 shall not be deemed to govern all motor vehicle liability policies required by this chapter but only those certified for the purposes stated in chapter 46.29 RCW.

NEW SECTION.  Sec. 6. SHORT TITLE.This act may be known and cited as the private vehicle rental act.

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