S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  4404--A
 
                        2025-2026 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 4, 2025
                                ___________
 
 Introduced  by  M.  of A. WEPRIN, HUNTER, SIMON, BERGER, WOERNER, STERN,
   McDONALD,  CUNNINGHAM,  DE LOS SANTOS,  RIVERA,  SANTABARBARA,  DILAN,
   COOK,  O'PHARROW,  STECK, BENEDETTO, JONES, ALVAREZ, BUTTENSCHON, KAY,
   WIEDER,  McMAHON,  KIM,  DINOWITZ,  STIRPE,  TAPIA,  LUPARDO,  LAVINE,
   EACHUS,  CRUZ, MANKTELOW -- read once and referred to the Committee on
   Transportation  --  committee  discharged,   bill   amended,   ordered
   reprinted as amended and recommitted to said committee
 
 AN ACT to amend the vehicle and traffic law, in relation to establishing
   an online insurance verification system for motor vehicle insurance
 
   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Subdivision 1 of section 312-a of the vehicle  and  traffic
 law,  as  amended by chapter 781 of the laws of 1983, is amended to read
 as follows:
   1. Upon issuance of an owner's policy of liability insurance or  other
 financial  security  required  by  this  chapter, an insurer shall issue
 proof of insurance in accordance with the regulations promulgated by the
 commissioner pursuant to [paragraph (b) of] subdivision two  of  section
 three hundred thirteen of this article.
   § 2. Subdivisions 2, 3 and 4 of section 313 of the vehicle and traffic
 law,  subdivision 2 as amended by chapter 678 of the laws of 1997, para-
 graphs (a), (b) and (d) of subdivision 2 and subdivision 4 as amended by
 chapter 509 of the laws of 1998,  paragraph  (b)  of  subdivision  4  as
 amended by chapter 161 of the laws of 2004, paragraph (d) of subdivision
 4  as further amended by section 104 of part A of chapter 62 of the laws
 of 2011, and subdivision 3 as amended by chapter  781  of  the  laws  of
 1983, are amended to read as follows:
   2.  [(a) Upon the termination of an owner's policy of liability insur-
 ance, other than an owner's policy of liability insurance for a motorcy-
 cle, at the request of the insured or by cancellation  by  the  insurer,
 the  insurer  shall  file a notice of termination with reference to such

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08820-05-5
              

 A. 4404--A                          2

 policy, as opposed to any insured vehicle or vehicles under such policy,
 with the commissioner not later than thirty days following the effective
 date of such cancellation or other termination, in accordance  with  the
 regulations  required  by  paragraph (c) of this subdivision. An insurer
 shall not file a notice of termination with the commissioner  except  as
 required by this subdivision.
   (b)  Upon the issuance of an owner's policy of liability insurance the
 insurer shall file a notice or confirmation of issuance  with  reference
 to such policy not later than fourteen days following the effective date
 of  such issuance, and not later than seven days following the effective
 date for policies issued after  January  first,  two  thousand  one,  in
 accordance with the regulations required by paragraph (c) of this subdi-
 vision.
   (c)] The commissioner shall promulgate regulations establishing proce-
 dures  for issuance of proof of insurance [and for reporting by insurers
 of notices of termination and policy issuance, either electronically  or
 by  paper copy, at the option of the department. Such reporting shall be
 required for every cancellation or termination which is effective on  or
 after  July  first,  nineteen  hundred  eighty-four and for every policy
 issuance which is effective on or after  January  first,  two  thousand;
 provided,  however,  that should the commissioner find, after testing of
 reporting procedures, that it would be feasible to require reporting for
 policy cancellations, terminations or issuances effective on an  earlier
 date,  he  may  by regulation so require reporting on such earlier date,
 but in no event shall reporting be required for cancellations or  termi-
 nations  effective prior to February first, nineteen hundred eighty-four
 nor for policy issuances effective prior to  September  first,  nineteen
 hundred ninety-nine. Insurers shall cooperate fully with the commission-
 er in any such testing of reporting procedures.
   (d)  Upon  application  by an insurer, the commissioner may extend the
 period for filing of notices of termination by such insurer  for  up  to
 fifteen  days,  and  for  seven  days for policies issued by an insurer.
 Extensions shall not be granted unless the insurer demonstrates  to  the
 satisfaction  of the commissioner that compliance with the notice period
 would result in substantial hardship to the  insurer.  The  commissioner
 shall maintain a list of extensions granted pursuant to this paragraph].
   3.  A  cancellation  or termination for which notice is required to be
 filed with  the  commissioner  [pursuant  to  subdivision  two  of  this
 section]  shall  not be effective with respect to persons other than the
 named insured and members of the insured's household until  the  insurer
 has filed a notice thereof with the commissioner or until another insur-
 ance  policy  covering  the  same  risk has been procured, except that a
 notice filed with the commissioner, in  the  format  prescribed  by  the
 commissioner,  [within  the period prescribed in subdivision two of this
 section] shall be effective as of the date certified therein, regardless
 of whether a suspension  order  is  issued  pursuant  to  section  three
 hundred  eighteen of this article. A receipt from the department stating
 that a notice of termination has been filed shall be  deemed  conclusive
 evidence of such filing. An insurer shall cooperate with the commission-
 er in attempting to identify persons not in compliance with this article
 in  cases  where the information reported by the insurer does not corre-
 spond with records maintained by the department.
   4. Notwithstanding any other provision of this article to the  contra-
 ry,  the  commissioner  shall establish a [pilot program] SYSTEM FOR THE
 ONLINE VERIFICATION OF MOTOR VEHICLE LIABILITY  INSURANCE  to  [maintain
 an]  ENABLE  THE COMMISSIONER TO ACCESS up-to-date insured vehicle iden-
 A. 4404--A                          3
 
 tification [database] INFORMATION to  assist  in  identifying  uninsured
 motor  vehicles,  AND  SHALL  VERIFY  MOTOR  VEHICLE OWNERS' POLICIES OF
 LIABILITY INSURANCE THROUGH THE UTILIZATION OF SUCH ONLINE  VERIFICATION
 SYSTEM.    Such  [databases]  ONLINE VERIFICATION SYSTEM shall be imple-
 mented by the department pursuant to standards prescribed by the commis-
 sioner [or an agent designated by the commissioner which] WHO shall seek
 technical assistance from affected insurers and the New York  Automobile
 Insurance  Plan. This [program] ONLINE VERIFICATION SYSTEM shall utilize
 all information collected  pursuant  to  this  section  and  shall  also
 include the following elements:
   (a) [In addition to and in conjunction with the provisions of subdivi-
 sion  two of this section, insurers] INSURERS that write private passen-
 ger or commercial motor vehicle insurance  in  this  state  shall  [also
 submit to the department, either electronically or by paper copy, at the
 option  of  the department], WITH RESPECT TO EVERY MOTOR VEHICLE INSURED
 BY SUCH INSURER IN THE STATE AND IN COMPLIANCE WITH ANY RULES AND  REGU-
 LATIONS  PROMULGATED  BY  THE  COMMISSIONER  FOR THE ONLINE VERIFICATION
 SYSTEM ESTABLISHED PURSUANT TO THIS SUBDIVISION, PROVIDE THE COMMISSION-
 ER ACCESS TO information that identifies those MOTOR  VEHICLE  LIABILITY
 INSURANCE  policies  that have been cancelled, terminated or non-renewed
 and all SUCH policies that have been issued, the date when  such  insur-
 ance  lapses,  and  any  other  information  that the commissioner deems
 necessary to efficiently identify and track uninsured vehicles  in  this
 state such as a policyholder's address, policy number, vehicle registra-
 tion  number,  and  vehicle  identification  number.  The department may
 exempt from such [pilot program] ONLINE VERIFICATION SYSTEM the transfer
 of information on certain classifications of vehicles that  are  in  the
 opinion of the department generally insured and which it is difficult to
 identify  uninsured  vehicles  within such classification, such as large
 commercial vehicle fleets;
   (b) [The department shall forward to each motor  vehicle  insurer,  at
 such  times  as  deemed necessary and appropriate by the commissioner, a
 listing of all the registrants the department has  on  file  as  insured
 with  that  insurer.  Such  insurer shall then review the listing within
 thirty days of receipt of the listing and report to the department which
 of the registrants the insurer does not insure;
   (c)] The commissioner shall, in conjunction with the superintendent of
 state police and local law enforcement officials formulate  a  means  to
 allow  INFORMATION FROM such [database] ONLINE VERIFICATION SYSTEM to be
 easily accessible to on-duty law enforcement personnel in  the  perform-
 ance  of  their  official duties for the purpose of verifying whether an
 operator maintains proper insurance coverage and to increase  compliance
 with  the  motor  vehicle financial security laws under this article and
 article eight of this title;
   [(d)] (C) In developing the mechanism  FOR  SUCH  ONLINE  VERIFICATION
 SYSTEM  to  electronically  transfer  information to the department, the
 commissioner shall consult with the superintendent of financial services
 and insurers to adopt a standardized system of organizing, recording and
 transferring such information so as to minimize  insurer  administrative
 expenses.  The commissioner shall to the maximum extent possible utilize
 nationally recognized electronic data information systems such as  those
 developed  by  the American National Standards Institute or the American
 Association of Motor Vehicle Administrators;
   [(e)] (D)(1) Either simultaneously or after  the  [up-dated  database]
 ONLINE  VERIFICATION system has been established, the commissioner shall
 develop a computer indicator that can be imprinted on a  vehicle  regis-
 A. 4404--A                          4
 
 tration  sticker  or on a sticker to be affixed to the insured's license
 plate. Such indicator system shall enable law enforcement personnel  and
 other  authorized  persons  when  acting in the course of their official
 duties  to  access  INFORMATION  IN  the  department's [database] ONLINE
 VERIFICATION SYSTEM so that such persons can ascertain whether a vehicle
 is properly insured or not insured;
   (2) Such computer indicator system shall enable authorized persons  in
 the  performance  of their official duties to access information such as
 the registrant's name, vehicle identification number, name  of  insurer,
 current  status  of  insurance,  vehicle  registration  number and other
 information that the  commissioner  deems  necessary  to  implement  the
 provisions of this section. The commissioner in developing such computer
 indicator  system  shall enable authorized persons in the performance of
 their official duties to access only such information that is  necessary
 to  detect  uninsured  motor  vehicles or accomplish other goals clearly
 established and authorized by law. Such computer indicator system  shall
 be designed to protect the personal privacy interests of motorists;
   [(f)]  (E)  (I)  The  commissioner  shall maintain [an insured vehicle
 database] SUCH ONLINE VERIFICATION system [that is] WHICH SHALL BE accu-
 rate to within a period of  [fourteen  days  and  a  computer  indicator
 system described in paragraph (e) of this subdivision within twenty-four
 months  of  the  effective date of this subdivision and to within] seven
 days [by January first, two thousand one. The commissioner shall  submit
 to  the  legislature  a report within eighteen months from the date this
 subdivision takes effect which  outlines  the  progress  being  made  to
 implement  such database and computer indicator system. After such data-
 base and computer indicator system is established and  put  into  opera-
 tion,  the commissioner shall make recommendations to the legislature to
 alter, minimize or eliminate the need  for  the  issuance  of  insurance
 identification  cards, simplify the requirements to demonstrate proof of
 financial security and certificate of insurance  currently  required  by
 this  article,  eliminate  the  requirement  for  production of proof of
 financial  security  to  accompany  applications  for  registrations  or
 renewals  thereof  provided that such database indicates that the regis-
 trant is insured, and  the  repeal  or  modification  of  section  three
 hundred  twelve-a  of  this  article.  The  commissioner shall also make
 recommendations to the legislature to streamline and shorten the  notice
 termination  requirements  of  subdivisions  one,  two and three of this
 section and section three hundred eighteen of this article. Such  report
 shall be submitted to the legislature within twelve months from the date
 such database and indicator system has been implemented];
   (II)  THE  COMMISSIONER  SHALL  PROVIDE  THAT SUCH ONLINE VERIFICATION
 SYSTEM SHALL, AT A MINIMUM:
   (1) HAVE THE CAPABILITY FOR THE DEPARTMENT TO SEND REQUESTS  TO  MOTOR
 VEHICLE INSURERS FOR VERIFICATION OF EVIDENCE OF A MOTOR VEHICLE OWNER'S
 POLICY  OF  LIABILITY  INSURANCE  AS  PRESCRIBED BY THIS CHAPTER VIA WEB
 SERVICES, THROUGH THE INTERNET,  OR  A  SIMILAR  PROPRIETARY  OR  COMMON
 CARRIER  ELECTRONIC  SYSTEM,  AS  WELL  AS TO RECEIVE FROM MOTOR VEHICLE
 INSURERS VERIFICATION OF EVIDENCE OF A MOTOR VEHICLE OWNER'S  POLICY  OF
 LIABILITY  INSURANCE  IN  A FORM AND MANNER AS PRESCRIBED BY THE COMMIS-
 SIONER;
   (2) INCORPORATE INFORMATION SECURITY PROTECTIONS FOR SUCH SYSTEM.  FOR
 THE PURPOSES OF THIS SECTION, "INFORMATION SECURITY" SHALL MEAN PROTECT-
 ING  INFORMATION  AND INFORMATION SYSTEMS FROM UNAUTHORIZED ACCESS, USE,
 DISCLOSURE, DISRUPTION, MODIFICATION, OR DESTRUCTION IN ORDER TO PROVIDE
 (A) INTEGRITY, WHICH SHALL MEAN GUARDING  AGAINST  IMPROPER  INFORMATION
 A. 4404--A                          5
 
 MODIFICATION  OR DESTRUCTION, AND INCLUDES ENSURING INFORMATION NONREPU-
 DIATION AND AUTHENTICITY, (B) CONFIDENTIALITY, WHICH SHALL MEAN PRESERV-
 ING AUTHORIZED RESTRICTIONS ON ACCESS AND  DISCLOSURE,  INCLUDING  MEANS
 FOR  PROTECTING  PERSONAL  PRIVACY  AND PROPRIETARY INFORMATION, AND (C)
 AVAILABILITY, WHICH SHALL MEAN ENSURING TIMELY AND  RELIABLE  ACCESS  TO
 AND USE OF INFORMATION AS AUTHORIZED BY THIS SUBDIVISION;
   (3) HAVE THE CAPABILITY OF BEING UTILIZED FOR VERIFICATION OF MANDATO-
 RY  MOTOR  VEHICLE  LIABILITY  INSURANCE  COVERAGE AS PRESCRIBED BY THIS
 CHAPTER AND THE ABILITY TO BE INTERFACED, WHEREVER  AUTHORIZED  BY  LAW,
 WITH  EXISTING  OR  FUTURE  STATE  SYSTEMS,  IN  A  FORM  AND  MANNER AS
 PRESCRIBED BY THE COMMISSIONER;
   (4) HAVE THE CAPABILITY OF ENABLING THE DEPARTMENT TO  MAKE  INQUIRIES
 TO MOTOR VEHICLE INSURERS FOR EVIDENCE OF A MOTOR VEHICLE OWNER'S POLICY
 OF  LIABILITY  INSURANCE  AS SET FORTH IN PARAGRAPH (A) OF THIS SUBDIVI-
 SION;
   (5) HAVE THE CAPABILITY OF RESPONDING TO EACH REQUEST OF  THE  DEPART-
 MENT  FOR MOTOR VEHICLE LIABILITY INSURANCE INFORMATION WITHIN AN AMOUNT
 OF TIME DETERMINED BY THE COMMISSIONER; AND
   (6) HAVE THE CAPABILITY OF RESPONDING WITHIN THE TIME ESTABLISHED;
   [(g) To minimize the cost of this program,  the  commissioner,  if  he
 deems  it  necessary  and prudent, can initially limit the scope of this
 project to a select number of vehicle classifications or insurers;
   (h)] (F) Notwithstanding  any  other  provision  of  law,  information
 obtained  by  the  department  pursuant  to  this  section  shall not be
 disclosed, used, sold, accessed, utilized in any manner or  released  by
 the  department  to  any person, corporation, or state and local agency,
 except in response to a specific, individual request for  such  informa-
 tion  authorized pursuant to the federal driver's privacy protection act
 (18 U.S.C. 2721 et.seq.). The department  shall  institute  measures  to
 ensure  that only authorized persons are permitted to access such infor-
 mation for the purposes specified by this section. Persons who knowingly
 release or disclose information from such [database] ONLINE VERIFICATION
 SYSTEM for a purpose other than those described as  authorized  by  this
 section  or  to a person not entitled to receive it shall be guilty of a
 misdemeanor for each such release or disclosure; and
   [(i) The commissioner may postpone implementation of such pilot  data-
 base  and  computer  indicator system for a period of time not to exceed
 eighteen months if he or she determines that the program  is  not  ready
 for  implementation.  Should the commissioner determine that such system
 cannot be implemented during the eighteen  months  extension,  then  the
 commissioner  shall  report  to  the  legislature  the  reasons why such
 program cannot be implemented and request that the  law  be  amended  to
 delay its implementation date]
   (G)  UNDERGO  AN APPROPRIATE TESTING AND PILOT PERIOD OF NOT LESS THAN
 ONE YEAR, AFTER WHICH THE COMMISSIONER SHALL CERTIFY IN WRITING  TO  THE
 GOVERNOR,  THE TEMPORARY PRESIDENT OF THE SENATE, AND THE SPEAKER OF THE
 ASSEMBLY THAT SUCH SYSTEM IS FULLY OPERATIONAL.
   § 3. Paragraph (d) of subdivision 3 of section 317 of the vehicle  and
 traffic  law, as added by chapter 678 of the laws of 1997, is amended to
 read as follows:
   (d) To fully fund such [pilot database] system FOR THE ONLINE  VERIFI-
 CATION  OF MOTOR VEHICLE LIABILITY INSURANCE and bar code program estab-
 lished pursuant to subdivision four of section three hundred thirteen of
 this article, the commissioner shall utilize the following three sources
 of revenue: (1) twenty-five percent of all civil penalties imposed  upon
 persons  fined pursuant to paragraph (b) of subdivision one-a of section
 A. 4404--A                          6
 
 three hundred eighteen of this article, (2) monies obtained from  grants
 that may be awarded to the commissioner from the motor vehicle theft and
 insurance  fraud  prevention fund, and (3) pro rata assessments upon all
 insurance  carriers subject to the provisions of this section in propor-
 tion to the premium estimates filed by such carriers.
   § 4. This act shall take effect December 31, 2028.    Effective  imme-
 diately, the addition, amendment and/or repeal of any rule or regulation
 necessary  for  the implementation of this act are authorized to be made
 and completed on or before such effective date.