PRINTER'S NO. 1336
No. 1165 Session of 1989
INTRODUCED BY FREIND, MOWERY, DEMPSEY, FLICK, GLADECK, GODSHALL,
REINARD, VROON, SAURMAN, CHADWICK, GALLEN, NAHILL, DISTLER,
SEMMEL, S. H. SMITH, BELARDI, J. H. CLARK, FOSTER, LEH,
BURNS, HERMAN, BRANDT, JACKSON, CARLSON, KONDRICH, LEE,
MARSICO, ROBBINS, J. TAYLOR, SERAFINI, WILSON, CALTAGIRONE,
ADOLPH, BARLEY, PICCOLA, KENNEY, MERRY, LANGTRY, DIETTERICK,
E. Z. TAYLOR, JOHNSON, FOX, BIRMELIN, CORNELL, HERSHEY,
WESTON, D. W. SNYDER, DININNI, GEIST, CAWLEY, CESSAR, BURD,
FLEAGLE, FARMER, HASAY, HECKLER, BUSH, PITTS, TELEK, WOGAN,
SCHULER, NAILOR, MICOZZIE, RAYMOND AND CIVERA, APRIL 12, 1989
REFERRED TO COMMITTEE ON INSURANCE, APRIL 12, 1989
AN ACT
1 Amending Title 75 (Vehicles) of the Pennsylvania Consolidated
2 Statutes, providing for the surrender of drivers' licenses,
3 registration plates and registration cards to sheriffs and
4 constables upon suspension; establishing certain fees;
5 further providing for certain benefits and coverage; and
6 providing for financial responsibility verification.
7 The General Assembly of the Commonwealth of Pennsylvania
8 hereby enacts as follows:
9 Section 1. Sections 1376 and 1540(c) of Title 75 of the
10 Pennsylvania Consolidated Statutes are amended to read:
11 § 1376. Surrender of registration plates and cards upon
12 suspension.
13 (a) General rule.--The department, upon suspending any
14 registration, shall require the registration plate or plates and
15 registration card or cards to be surrendered immediately to the
16 department [and].
1 (b) Delegation of authority.--The department may delegate
2 authority to [any authorized department employee, member of the
3 Pennsylvania State Police or local police officer to seize the
4 registration plate or plates and registration card or cards.]
5 the following persons to seize a registration plate and
6 registration card which are required to be surrendered under
7 subsection (a):
8 (1) A designated department employee.
9 (2) Members of the Pennsylvania State Police.
10 (3) Local police officers.
11 (4) Sheriffs or deputy sheriffs.
12 (5) Constables or deputy constables. If constables and
13 deputy constables are delegated authority to seize
14 registration plates and registration cards under this
15 section, they shall be compensated by the department at the
16 rate of $15 for each registration plate and card jointly
17 seized, plus mileage. The department shall pay a constable or
18 deputy constable within 30 days after a documented request
19 for payment is submitted to it.
20 (c) Regulations.--The department shall, by regulation,
21 prescribe the manner of selecting [the employees and State and
22 local police officers] those enforcement officials who are
23 delegated authority under this section to seize the registration
24 plates and registration cards.
25 [(b)] (d) Penalty.--Any person failing or refusing to
26 surrender to the department or its authorized delegate, upon
27 demand, any registration plate or card which has been suspended
28 is guilty of a summary offense and shall, upon conviction, be
29 sentenced to pay a fine of $100, plus costs. Cost shall include
30 a reasonable fee for official seizure of the unsurrendered
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1 items.
2 § 1540. Surrender of license.
3 * * *
4 (c) Seizure of revoked and suspended licenses.--
5 (1) The department may delegate authority to [any
6 authorized department employee, member of the Pennsylvania
7 State Police or local police officer] the following persons
8 to seize the driver's license of any person [when the
9 operating privilege of that person has been revoked or
10 suspended and his] whose driver's license has been ordered to
11 be surrendered by a court or district attorney or by the
12 department[.]:
13 (i) A designated department employee.
14 (ii) Members of the Pennsylvania State Police.
15 (iii) Local police officers.
16 (iv) Sheriffs or deputy sheriffs.
17 (v) Constables or deputy constables. If constables
18 and deputy constables are delegated authority to seize
19 drivers' licenses under this subsection, they shall be
20 compensated by the department at the rate of $15 for each
21 driver's license seized, plus mileage. The department
22 shall pay a constable or deputy constable within 30 days
23 after a documented request is submitted to it.
24 (2) The department shall, by regulation, prescribe the
25 manner of selecting [the employees and State and local police
26 officers] those enforcement officials who are delegated
27 authority under this subsection to seize the drivers'
28 licenses.
29 Section 2. Chapter 17 of Title 75 is repealed.
30 Section 3. Title 75 is amended by adding a chapter to read:
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1 CHAPTER 17
2 FREEDOM OF CHOICE MOTOR VEHICLE INSURANCE
3 Subchapter
4 A. General Provisions
5 B. Motor Vehicle Insurance Basic Benefits
6 C. Uninsured and Underinsured Motorist Coverage
7 D. Assigned Risk Plan
8 E. Assigned Claims Plan
9 F. Nonpayment of Judgments
10 G. Proof of Financial Responsibility
11 H. Miscellaneous Provisions
12 SUBCHAPTER A
13 GENERAL PROVISIONS
14 Sec.
15 1701. Short title of chapter.
16 1702. Findings and purpose.
17 1703. Definitions.
18 1704. Application of chapter.
19 1705. Administration of chapter.
20 1706. Basic benefits.
21 1707. Applicable coverage.
22 1708. Freedom of choice; elections.
23 § 1701. Short title of chapter.
24 This chapter shall be known and may be cited as the Freedom
25 of Choice Motor Vehicle Insurance Law.
26 § 1702. Findings and purpose.
27 (a) Findings.--The General Assembly finds as follows:
28 (1) The rising cost of motor vehicle insurance in this
29 Commonwealth has made automobile insurance coverages
30 unaffordable to large segments of the motor-vehicle-owning
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1 public.
2 (2) Former Chapter 17 of this title, known as the Motor
3 Vehicle Financial Responsibility Law, has proven to be
4 ineffective in holding motorists financially responsible and,
5 as a consequence, may have contributed to the rising cost of
6 insurance by requiring motorists to purchase coverages that
7 could be provided from alternative sources at lower cost.
8 (3) These recognized defects in current law can be
9 corrected by adoption of this legislation.
10 (b) Legislative purposes.--The General Assembly proposes:
11 (1) To require the registered owners of motor vehicles
12 and the operators of motor vehicles to procure certain forms
13 of insurance coverages to provide basic benefits to injured
14 automobile accident victims and bodily injury and property
15 damage liability protection arising out of the ownership,
16 maintenance or use of such motor vehicles as a condition of
17 operating the vehicles on the public highways of this
18 Commonwealth.
19 (2) To effect reasonably prompt payment to victims of
20 motor vehicle accidents without regard to fault in order to
21 eliminate the inequities which fault determination has
22 created.
23 (3) To encourage and promote reasonable and necessary
24 medical care and rehabilitative services to the motor vehicle
25 accident victim by providing for the prompt payment of
26 necessary medical and rehabilitation services which are
27 actually rendered.
28 (4) To reduce the need to resort to litigation and the
29 expense of claims bargaining based upon the determination of
30 fault by establishing a system, for those who elect to choose
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1 it, which provides for the payment of economic losses to
2 automobile accident victims without the delay, expense and
3 uncertainty of litigation.
4 (5) To enhance the continued availability of required
5 motor vehicle insurance coverages at reasonable prices by
6 effecting a more efficient, economical and equitable system
7 of insurance to indemnify injured victims of motor vehicle
8 accidents.
9 (6) To provide the citizens of this Commonwealth the
10 right and freedom to choose between an indemnity system
11 assuring the payment of essential insurance benefits and a
12 system that subjects a registered owner of a motor vehicle
13 and the operator thereof to all the rights and liabilities of
14 the negligence system.
15 § 1703. Definitions.
16 The following words and phrases when used in this chapter
17 shall have the meanings given to them in this section unless the
18 context clearly indicates otherwise:
19 "Added benefits." Benefits provided by optional added
20 benefits insurance in excess of the minimum basic benefits.
21 "Basic benefits." Benefits providing for net loss suffered
22 through injury arising out of the operation, maintenance and use
23 of a motor vehicle, subject to the limits, deductibles,
24 exclusions, disqualifications and other conditions provided in
25 this act. The minimum amount of basic benefits payable to each
26 person for all economic loss claimed and resulting from injury
27 as the result of any one accident shall be $2,500. Basic
28 benefits do not include benefits for damage to property. Basic
29 benefits consist of one or more of the elements defined as loss.
30 "Basic benefits insurance." A contract, self-insurance or
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1 other legal means under which the obligation to pay basic
2 benefits arises.
3 "Basic benefits insured." A person identified by name in a
4 policy of insurance or other contract, program, arrangement or
5 group providing basic benefits in compliance with this act. The
6 term includes the following persons not identified by name as an
7 insured in any other contract of basic benefits insurance
8 complying with this act, if the person is residing in the same
9 household with a named insured:
10 (1) A spouse or other relative of a named insured.
11 (2) A minor in the custody of a named insured.
12 (3) A relative residing in the same household with the
13 named insured if the relative customarily and usually makes
14 his place of domicile in the same family unit, even though
15 the relative temporarily lives elsewhere.
16 "Department." The Department of Transportation of the
17 Commonwealth or the Insurance Department of the Commonwealth, as
18 applicable.
19 "Financial responsibility." The ability to respond in
20 damages for liability on account of accidents arising out of the
21 maintenance or use of a motor vehicle in the amount of $10,000
22 because of injury to one person in any one accident, in the
23 amount of $20,000 because of injury to two or more persons in
24 any one accident and in the amount of $5,000 because of damage
25 to property of others in any one accident. The financial
26 responsibility shall be in a form acceptable to the Department
27 of Transportation.
28 "Injury" or "injury to person." Bodily harm, sickness,
29 disease or death accidentally inflicted and arising out of the
30 operation, maintenance or use of a motor vehicle.
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1 "Insurer." A legal entity licensed under the insurance laws
2 of this Commonwealth to do the business of insurance, including
3 an entity created under 40 Pa.C.S. Chs. 61 (relating to hospital
4 plan corporations) and 63 (relating to professional health
5 services plan corporations) or the act of December 29, 1972
6 (P.L.1701, No.364), known as the Health Maintenance Organization
7 Act, or a self-insurer or obligated government providing tort
8 liability insurance of basic loss benefits under this act.
9 "Loss." Accrued economic loss consisting only of:
10 (1) Reasonable and necessary medical expense.
11 (2) Rehabilitation services.
12 (3) Work loss.
13 (4) Service expenses reasonably and necessarily incurred
14 in obtaining ordinary services which, but for the injury to
15 the person, would customarily and usually be performed by the
16 injured person, not for income but for his personal benefit,
17 and which cannot be provided by members of his family
18 residing with him.
19 Economic loss is loss although caused by pain and suffering of
20 physical impairment resulting from injury. Noneconomic detriment
21 is not loss.
22 "Maintaining a motor vehicle." Having legal custody,
23 possession or responsibility by a person other than an owner or
24 operator.
25 "Medical expense." Reasonable charges incurred for necessary
26 products, services and accommodations, including those for
27 medical care, physical rehabilitation, rehabilitative
28 occupational training and other remedial treatment and care. The
29 term may include non-medical remedial treatment rendered in
30 accordance with the recognized religious method of healing. The
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1 term does not include that portion of any charge for a room in a
2 hospital, clinic, convalescent or nursing home, or any other
3 institution engaged in providing nursing care and related
4 services, in excess of the reasonable and customary charge for
5 semiprivate accommodations, unless intensive care is medically
6 required. Medical expense includes the cost of services
7 performed by all healing arts professions licensed by the
8 Commonwealth. There shall be a presumption that any bill for
9 medical expenses submitted is reasonable.
10 "Motor vehicle." A motor vehicle of the kind required to be
11 registered under this title.
12 "Net loss." Loss, less benefits or advantages, from sources
13 other than basic loss benefits required to be subtracted from
14 loss in calculating net loss.
15 "Noneconomic detriment." Pain, suffering, inconvenience,
16 physical impairment and any other nonpecuniary damage
17 recoverable under the tort laws of this Commonwealth. The term
18 does not include punitive or exemplary damages.
19 "Owner." A person, other than a lienholder or secured party,
20 who owns or has title to a motor vehicle or who is entitled to
21 the use and possession of a motor vehicle subject to a security
22 interest held by another person. The term does not include a
23 lessee under a lease not intended as security.
24 "Self-insurer." An entity other than an insurer providing
25 financial responsibility and basic benefits, and qualified by
26 the department.
27 "Underinsured motor vehicle." A motor vehicle for which the
28 limits of available liability insurance and self-insurance are
29 insufficient to pay losses and damages.
30 "Uninsured motor vehicle." Any of the following:
19890H1165B1336 - 9 -
1 (1) A motor vehicle for which there is no liability
2 insurance or self-insurance applicable at the time of the
3 accident.
4 (2) A motor vehicle for which the insurance company
5 denies coverage or the insurance company is or becomes
6 involved in insolvency proceedings in any jurisdiction.
7 (3) An unidentified motor vehicle that causes an
8 accident resulting in injury provided the accident is
9 reported to the police or proper governmental authority and
10 the claimant notifies his insurer within 30 days, or as soon
11 as practicable thereafter, that the claimant or his legal
12 representative has a legal action arising out of the
13 accident.
14 (4) A motor vehicle insured under the no-fault insurance
15 alternative.
16 "Use of a motor vehicle." Any utilization of a motor vehicle
17 relating to the movement of people or goods on the public
18 highways. The term includes occupying, entering into and
19 alighting from a motor vehicle. The term does not include:
20 (1) Conduct within the course of any business of
21 repairing, servicing or otherwise maintaining motor vehicles
22 unless the conduct occurs off the business premises.
23 (2) Conduct in the course of loading and unloading the
24 vehicle.
25 "Work loss." Loss of income from work that the injured
26 person would have earned from gainful employment if that person
27 had not been injured. The term includes expenses reasonably
28 incurred by the person in obtaining services in lieu of those
29 that the person would have performed for income, reduced by any
30 income from substitute work actually performed by that person.
19890H1165B1336 - 10 -
1 § 1704. Application of chapter.
2 Except when the United States may obligate itself under
3 either a fault or no-fault election, this chapter does not apply
4 with respect to any motor vehicle owned by the United States.
5 § 1705. Administration of chapter.
6 (a) General rule.--Except as provided in subsection (b), the
7 Department of Transportation shall administer and enforce this
8 chapter and may make rules and regulations necessary for the
9 administration and enforcement of this chapter.
10 (b) Insurance matters.--The Insurance Department shall
11 administer and enforce those provisions of this chapter as to
12 matters under its jurisdiction as determined by this chapter or
13 other statute and may make rules and regulations necessary for
14 the administration and enforcement of those provisions.
15 § 1706. Basic benefits.
16 (a) General rule.--Basic benefits shall be paid without
17 regard to fault.
18 (b) Payment.--Basic benefit insurers and the assigned claims
19 plan shall pay basic benefits, under the terms and conditions
20 stated in this chapter, for loss from injury arising out of
21 maintenance or use of a motor vehicle. This obligation exists
22 without regard to immunity from liability or suit which might
23 otherwise be applicable.
24 § 1707. Applicable coverage.
25 (a) General rule.--The basic benefits insurance applicable
26 to bodily injury is the basic benefits insurance covering the
27 vehicle occupied by the injured person at the time of the
28 accident or, if the injured person is a pedestrian and not
29 otherwise insured, the basic benefits insurance covering the
30 vehicle which struck such pedestrian.
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1 (b) Failure to make payment.--If the insurer providing basic
2 benefits fails to make payment for loss within 30 days after
3 receipt of reasonable proof of the fact and the amount of loss
4 sustained, the injured person shall be entitled to payment under
5 any contract of basic benefits coverage under which the injured
6 person is a basic benefits insured, and the insurer making such
7 payments shall be entitled to full reimbursement from the basic
8 benefits insurer providing the basic benefits insurance covering
9 the vehicle.
10 (c) Vehicles not covered.--If there is no basic benefits
11 insurance covering the vehicle, any contract of basic benefits
12 under which the injured person is a basic benefits insured shall
13 apply.
14 (d) Benefit limitation.--No person shall be entitled to
15 recover basic benefits in excess of the actual net loss incurred
16 as a result of the same accident.
17 § 1708. Freedom of choice; elections.
18 (a) Insurance requirement.--
19 (1) The owner of a motor vehicle required to be
20 registered in this Commonwealth shall not operate or
21 authorize any other person to operate the vehicle on the
22 public highways unless the owner has insurance on the motor
23 vehicle providing either the fault insurance alternative
24 under subsection (b), or the no-fault insurance alternative
25 under subsection (c). The selection of one or the other of
26 the insurance alternatives is applicable to every motor
27 vehicle registered by the owner.
28 (2) Each insurer, prior to issuance or renewal of a
29 motor vehicle liability insurance policy, shall notify, in
30 writing, each applicant and each named insured of the
19890H1165B1336 - 12 -
1 availability of the two alternatives of fault insurance and
2 no-fault insurance described in subsections (b) and (c). The
3 notice shall be in a standardized form promulgated by the
4 Insurance Commissioner. Any person signing, or otherwise
5 bound by, a document containing such terms is bound by such
6 election and is precluded from claiming liability of any
7 person based upon being inadequately informed in making the
8 election between fault or no-fault alternatives.
9 (3) If an insured or any other person who receives a
10 notice under paragraph (2) and fails to indicate a choice
11 then no insurance shall be issued and that insured or person
12 will be subject to paragraph (4).
13 (4) Notwithstanding the provisions of paragraph (3), if
14 any owner of a motor vehicle required to be registered in
15 this Commonwealth fails to indicate, prior to a motor vehicle
16 accident, whether the owner wishes to maintain the fault
17 insurance alternative or the no-fault insurance alternative,
18 the owner, and those he is empowered by this chapter to bind
19 by his choice, are conclusively presumed to have chosen the
20 fault alternative.
21 (5) Nothing in this chapter changes or modifies the
22 existing requirement that owners of registered vehicles
23 maintain bodily injury and property damage liability
24 insurance arising out of the ownership, maintenance or use of
25 a motor
26 (6) Qualifying self-insureds shall similarly make a
27 selection of either the fault or no-fault alternative in such
28 manner as prescribed by the department. The selection of one
29 or the other of the alternatives is applicable to every motor
30 vehicle registered by the self-insured owner.
19890H1165B1336 - 13 -
1 (b) Fault insurance alternative.--
2 (1) Fault insurance covers each person who is:
3 (i) A named insured under a motor vehicle insurance
4 policy.
5 (ii) The spouse, other relative or dependent
6 residing in the same household of a named insured.
7 (iii) Anyone operating the vehicle with the
8 permission of the owner.
9 Fault insurance coverage shall be for the legal liability for
10 bodily injury, including death, and property damage arising
11 out of the ownership, maintenance or use of the vehicle to
12 the limits of liability prescribed in section 1712 (relating
13 to availability of adequate limits and benefits) of this
14 chapter, exclusive of interest and costs.
15 (2) Each person who is a named insured under a fault
16 insurance policy, each person bound by the election of the
17 named insured and covered under a policy issued under the
18 fault alternative, and each person who is an occupant of a
19 motor vehicle insured under the fault insurance alternative,
20 unless such person is an insured under an insurance policy
21 issued under the no-fault insurance alternative, shall obtain
22 compensation for economic loss sustained from available basic
23 benefits insurance. For economic loss sustained in excess of
24 basic benefits insurance and other damages, including non-
25 economic loss claimed, the injured person shall obtain
26 compensation for such loss or damages sustained in a motor
27 vehicle accident as the consequence of the fault of another
28 person who is uninsured or who is insured under the no-fault
29 alternative in subsection (c) from the uninsured motorist
30 coverage. Such uninsured motorist coverage is also known as
19890H1165B1336 - 14 -
1 "connector insurance coverage." Such injured persons insured
2 under the no-fault insurance alternative shall claim
3 compensation for loss and damages under the no-fault
4 insurance alternative policy under which they are insured and
5 shall be bound to the terms of the election.
6 (c) No-fault insurance alternative.--
7 (1) No-fault insurance provides compensation to persons
8 injured in a motor vehicle accident within the United States,
9 its territories or possessions, and Canada for reasonable and
10 necessary expenses incurred as a consequence of the accident
11 to at least the limits prescribed by this subsection.
12 Compensation is provided for basic benefits subject to such
13 deductibles, exclusions, waiting periods, reductions, limits,
14 sublimits, excess provisions and similar reductions which may
15 be approved by the Insurance Commissioner and selected by the
16 named insured.
17 (2) No-fault insurance basic benefits are payable
18 without regard to fault. No-fault insurance basic benefits
19 are not payable for any noneconomic loss, which term
20 includes, but is not necessarily limited to, pain, suffering,
21 inconvenience, physical impairment, grief and other
22 nonpecuniary damage recoverable under the law of this
23 Commonwealth applicable to personal injury.
24 (3) Tort liability is abolished with respect to any
25 injury for each person bound by the no-fault insurance
26 alternative that takes place in this Commonwealth in
27 accordance with the provisions of this chapter if that injury
28 arises out of the ownership, maintenance or use of a motor
29 vehicle. This tort liability abolition shall not apply in any
30 of the following circumstances:
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1 (i) The named insured or other operator of the
2 covered motor vehicle who is bound by the election of the
3 no-fault insurance alternative remains liable for injury
4 arising out of the ownership, maintenance or use of a
5 motor vehicle upon conviction of driving while under the
6 influence of alcohol or a controlled or illegal drug or
7 substance.
8 (ii) A person in the business of designing,
9 manufacturing, repairing, servicing or otherwise
10 maintaining motor vehicles remains liable for injury
11 arising out of a defect in such motor vehicle which is
12 caused by or not corrected by an act or omission in the
13 course of such business, other than a defect in a motor
14 vehicle which is operated by such business.
15 (iii) A person remains liable for intentionally
16 injuring himself or another person. An individual does
17 not intentionally injure himself or another individual
18 merely because his act or failure to act is intentional
19 or done with his realization that it creates a grave risk
20 of causing injury or the act or omission causing the
21 injury is for the purpose of averting bodily harm to
22 himself or another individual.
23 (4) The coverage provided under the no-fault insurance
24 alternative is applicable to each person who is:
25 (i) a named insured under a motor vehicle liability
26 insurance policy issued under the no-fault insurance
27 alternative;
28 (ii) the spouse, other relative or dependent
29 residing in the same household of a named insured under a
30 policy issued under the no-fault insurance alternative
19890H1165B1336 - 16 -
1 unless that person is covered under a policy issued under
2 the fault insurance alternative.
3 SUBCHAPTER B
4 MOTOR VEHICLE INSURANCE BASIC BENEFITS
5 Sec.
6 1711. Availability of benefits.
7 1712. Availability of adequate limits and benefits.
8 1713. Payment of benefits.
9 1714. Stacking of benefits.
10 1715. Exclusion from benefits.
11 1716. Coordination of benefits.
12 1717. Subrogation.
13 1718. Statute of limitations.
14 1719. Preclusion of pleading, proving and recovering required
15 benefits.
16 1720. Certain nonexcludable conditions.
17 § 1711. Availability of benefits.
18 An insurer issuing or delivering liability insurance policies
19 covering any motor vehicle of the type required to be registered
20 under this title, except recreational vehicles not intended for
21 highway use, motorcycles, motor-driven cycles or motorized
22 pedalcycles or like type vehicles, registered and operated in
23 this Commonwealth, shall make available for purchase first party
24 benefits with respect to injury arising out of the maintenance
25 or use of a motor vehicle as follows:
26 (1) Reasonable charges for reasonably needed medical,
27 hospital, dental, surgical, medicine, X-ray, ambulance,
28 emergency medical, rehabilitation, and nursing services.
29 Compensation includes reasonable expenses for any nonmedical
30 remedial care and treatment rendered in accordance with a
19890H1165B1336 - 17 -
1 recognized religious method of healing. Compensation does not
2 include any charge for a room in any facility engaged in
3 providing any such service to the extent that the charge is
4 in excess of a reasonable and customary charge for a semi-
5 private room, unless a private room is medically required.
6 (2) Compensation for net after tax lost earnings
7 sustained by each such injured person.
8 (3) Reasonable amounts required to be paid for services
9 which would have been performed by the injured person
10 personally had that person not been injured in a motor
11 vehicle accident.
12 (4) Rehabilitation services:
13 (i) Expenses for rehabilitation services, including
14 the cost of a procedure or treatment for rehabilitation
15 or a course of rehabilitative occupational training, if::
16 (A) the procedure, treatment or training is
17 reasonable and appropriate for the particular case;
18 and
19 (B) the cost is reasonable in relation to its
20 probable rehabilitative effects or the procedure,
21 treatment or training is likely to contribute
22 substantially to the restoration of the injured
23 person's earning capacity.
24 The cost of equipment, facilities, transportation or
25 other services necessary to rehabilitation services are
26 also recoverable. This paragraph applies only to services
27 performed by a provider which is licensed or approved by
28 an appropriate governmental or professional agency or
29 entity as qualified to provide such services.
30 (ii) The insurer shall notify an injured person or
19890H1165B1336 - 18 -
1 his legal representative that if the injured person
2 undertakes a procedure or treatment for rehabilitation or
3 a course of rehabilitative occupational training, other
4 than medical rehabilitation procedure or treatment, the
5 injured person shall notify the insurer within 60 days
6 after such undertaking if the cost of such rehabilitation
7 procedure or treatment is expected to exceed $1,000,
8 unless the insurer knows of or has reason to know of the
9 undertaking. If the injured person does not notify the
10 insurer within 60 days after such undertaking, the
11 insurer's obligations for such procedure or treatment
12 shall be limited to the actual expense incurred after
13 notice is actually given or $1,000, whichever is less.
14 (iii) If the injured person notifies the insurer of
15 a proposed procedure or treatment for rehabilitation, or
16 of a proposed specified course of rehabilitative
17 occupational training, and the insurer does not act
18 within 30 days from receipt of such notice to accept
19 responsibility for the cost, the injured person may bring
20 an action in the court of common pleas in the county of
21 residence of the injured person for a determination of
22 the insurer's responsibility for the cost of the
23 rehabilitative procedure or treatment. Upon a
24 determination by the court that the insurer is
25 responsible for the cost of a procedure, treatment or
26 course of rehabilitation, the insurer shall pay such
27 claim within 30 days following such determination. In
28 addition, the insurer shall be liable for costs and
29 interest prorated on an annual rate of 18% from the date
30 the claim was first presented to the insurer and such
19890H1165B1336 - 19 -
1 reasonable attorney fees as may be fixed by the court. If
2 the court determines that the insurer is not responsible
3 for the cost of the procedure, treatment or course of
4 treatment which the injured has undertaken or proposes to
5 undertake, such determination is not dispositive as to
6 the propriety of any other proposal or the injured
7 person's right to other benefits. This paragraph does not
8 preclude an action by the insurer or the injured person
9 for declaratory relief under any other law of this
10 Commonwealth, nor an action by the injured person to
11 recover other benefits under this paragraph.
12 (iv) If an insurer believes that an injured person
13 has unreasonably refused to accept a rehabilitative
14 procedure, treatment or course of occupational training,
15 an insurer may initiate an action in the court of common
16 pleas in the county in which the injured party resides
17 for a determination that future benefits will be
18 terminated or reduced to limit recovery of benefits to an
19 amount equal to benefits that in reasonable probability
20 would be due if the injured person had submitted to the
21 procedure, treatment or training and for other reasonable
22 orders.
23 (v) In determining whether an injured person has
24 reasonable ground for refusal to undertake the procedure,
25 treatment or training, the court shall consider all
26 relevant factors, including the risks to the injured
27 person, the extent of the probable benefit, the place
28 which the procedure, treatment or training is recognized
29 as standard and customary, and whether the imposition of
30 sanctions because of the person's refusal would abridge
19890H1165B1336 - 20 -
1 his right to the free exercise of his religion.
2 § 1712. Availability of adequate limits and benefits.
3 (a) Financial responsibility.--The minimum limit for
4 liability on account of accidents arising out of the maintenance
5 or use of a motor vehicle shall be not less than $10,000 because
6 of injury to one person in any one accident and $20,000 because
7 of injury to two or more persons in any one accident and for not
8 less than $5,000 because of damage to the property of others in
9 any one accident. The financial responsibility shall be in such
10 form as shall be acceptable to the department. Insurers shall
11 make available higher limits for liability than the minimums
12 stated herein.
13 (b) Basic benefits.--The minimum basic benefits insurance
14 that shall be provided to satisfy the requirements of this
15 chapter shall be not less than $5,000.
16 (c) Excess limits.--Insurers shall make available limits or
17 amounts higher than those provided above as a result of the same
18 accident.
19 (d) Notification.--Insurers must notify insureds or
20 prospective insureds, in a manner approved by the Insurance
21 Commissioner, of the coverages and options that are available or
22 unavailable for basic benefits coverage.
23 § 1713. Payment of benefits.
24 Benefits are overdue if not paid within 30 days after the
25 insurer receives reasonable proof of the amount of the benefits.
26 If reasonable proof is not supplied as to all benefits, the
27 portion supported by reasonable proof is overdue if not paid
28 within 30 days after the proof is received by the insurer.
29 Overdue benefits shall bear interest at the rate of 12% per
30 annum from the date the benefits become due. In the event the
19890H1165B1336 - 21 -
1 insurer is found to have acted in an unreasonable manner in
2 refusing to pay the benefits when due, the insurer shall pay, in
3 addition to the benefits owed and the interest thereon, a
4 reasonable attorney fee based upon actual time expended.
5 § 1714. Stacking of benefits.
6 First party benefits shall not be increased by stacking the
7 limits of coverage of:
8 (1) multiple motor vehicles covered under the same
9 policy of insurance; or
10 (2) multiple motor vehicle policies covering the
11 individual for the same loss.
12 § 1715. Exclusion from benefits.
13 (a) General rule.--An insurer shall exclude from benefits
14 any insured, or his personal representative, under a policy
15 enumerated in section 1711 (relating to required benefits) or
16 1712 (relating to availability of limits and benefits), when the
17 conduct of the insured contributed to the injury sustained by
18 the insured in any of the following ways:
19 (1) While intentionally injuring himself or another or
20 attempting to intentionally injure himself or another. An
21 individual does not intentionally injure himself or another
22 individual merely because his act or failure to act is
23 intentional or done with his realization that it creates a
24 grave risk of causing injury or the act or omission causing
25 the injury is for the purpose of averting bodily harm to
26 himself or another individual.
27 (2) While committing a felony.
28 (3) While seeking to elude lawful apprehension or arrest
29 by a law enforcement official.
30 (b) Conversion of vehicle.--A person who knowingly converts
19890H1165B1336 - 22 -
1 a motor vehicle is ineligible to receive first party benefits
2 from any source other than a policy of insurance under which he
3 is an insured for any injury arising out of the maintenance or
4 use of the converted vehicle.
5 (c) Named driver exclusion.--An insurer, at the request of a
6 named insured, shall exclude any other insured or his personal
7 representative from benefits under a policy to provide bodily
8 injury, liability and basic benefits when the insured is
9 excluded from coverage while operating a motor vehicle.
10 § 1716. Coordination of benefits.
11 (a) General rule.--Except for workmen's compensation, a
12 policy of insurance issued or delivered pursuant to this
13 subchapter shall be primary. Any program, group contract or
14 other arrangement for payment of benefits such as described in
15 section 1711 (relating to availability of benefits) or 1712
16 (relating to availability of adequate limits and benefits) shall
17 be construed to contain a provision that all benefits provided
18 therein shall be in excess of and not in duplication of any
19 valid and collectible basic benefits provided or workmen's
20 compensation.
21 (b) Livery.--If the accident causing the injury occurs while
22 the vehicle is being used in the business of transporting
23 persons or property, coverage for basic benefits is the coverage
24 applicable to the vehicle in which the injured person is an
25 occupant: if none, then the basic benefits coverage applicable
26 to the injured person: if none, the assigned claims plan in
27 which case the assigned claim plan shall have a right of
28 indemnity against the owner of the vehicle.
29 (c) Employer-furnished vehicle.--If the accident causing the
30 injury occurs while the injured person is driving or occupying a
19890H1165B1336 - 23 -
1 motor vehicle furnished by the employer, the coverage for
2 payment of basic benefits is the coverage applicable to the
3 vehicle or, if none, the coverage under which the injured person
4 is insured by his or another's choice unless the injured person
5 is driving or occupying the furnished motor vehicle while in and
6 about the business of the employer, in which case the injured
7 person would claim workmen's compensation benefits.
8 (d) Other vehicles.--In all other cases, the coverage for
9 payment of basic benefits is the coverage under which the
10 injured person is insured by his or another's choice or, if
11 none, the coverage applicable to the vehicle in or by which he
12 is injured.
13 (e) Definition.--As used in this section the term "program,
14 group contract or other arrangement" includes, but is not
15 limited to, benefits payable by a hospital plan corporation or a
16 professional health service corporation subject to 40 Pa.C.S.
17 Ch. 61 (relating to hospital plan corporations) or 63 (relating
18 to professional health services plan corporations).
19 § 1717. Subrogation.
20 (a) General rule.--In actions arising out of the maintenance
21 or use of a motor vehicle, there shall be no right of
22 subrogation or reimbursement from a claimant's tort recovery
23 with respect to workmen's compensation benefits, benefits
24 available under section 1711 (relating to availability of
25 benefits) or 1712 (relating to availability of adequate limits
26 and benefits) or benefits in lieu thereof paid or payable under
27 section 1716 (relating to coordination of benefits).
28 (b) Indemnification of insurer.--An insurer of basic
29 benefits insurance has a right of indemnity against a person who
30 has converted a motor vehicle involved in an accident, or a
19890H1165B1336 - 24 -
1 person who has intentionally caused injury to another person,
2 for basic benefits paid for the injury caused by the intentional
3 conduct of that person. Such right of indemnity shall include
4 the cost of processing the claim for such benefits and for
5 reasonable attorney fees and other expenses incurred for
6 enforcing such right of indemnity. For the purposes of this
7 subsection, a person is not a converter if he uses the motor
8 vehicle in the good faith belief that he is legally entitled to
9 do so.
10 (c) No-fault insurance limitation.--Any person eligible at
11 the time of an accident for basic benefits under the no-fault
12 insurance alternative may neither claim against, nor be claimed
13 against by, any other person insured under either the fault or
14 no-fault insurance alternative, including any other person for
15 whom such insured is vicariously liable, for liability based on
16 fault for an accident occurring within this Commonwealth arising
17 out of the ownership, maintenance or use of a motor vehicle
18 except as provided in section 1708(c)(3) (relating to freedom of
19 choice; elections), or for harm intentionally caused. For the
20 purposes of this subsection, "intentionally caused harm" is
21 defined according to section 1708(c)(3)(iii) (relating to
22 freedom of choice; elections).
23 § 1718. Statute of limitations.
24 (a) General rule.--If benefits have not been paid, an action
25 for basic benefits shall be commenced within four years from the
26 date of the accident giving rise to the claim. If basic benefits
27 have been paid, an action for further benefits shall be
28 commenced within four years from the date of the last payment.
29 (b) Minors.--For minors entitled to benefits described in
30 section 1711 (relating to availability of benefits), an action
19890H1165B1336 - 25 -
1 for basic benefits shall be commenced within four years from the
2 date on which the injured minor attains 18 years of age.
3 (c) Definition.--As used in this section the term "further
4 benefits" means expenses incurred not earlier than four years
5 preceding the date an action is commenced.
6 § 1719. Preclusion of pleading, proving and recovering required
7 benefits.
8 In any action for damages against a tortfeasor arising out of
9 the maintenance or use of a motor vehicle, a person who is
10 eligible to receive basic benefits under the coverages set forth
11 in section 1711 (relating to availability of benefits) shall be
12 precluded from pleading, introducing into evidence or recovering
13 the amount of benefits paid or payable under section 1711.
14 § 1720. Certain nonexcludable conditions.
15 (a) General rule.--Insurance benefits may not be denied
16 solely because the driver of the insured motor vehicle is
17 determined to be under the influence of drugs or intoxicating
18 beverages at the time of the accident for which benefits are
19 sought.
20 (b) Contract exclusions.--Provisions of an insurance policy
21 which exclude insurance benefits if the insured causes a
22 vehicular accident while under the influence of drugs or
23 intoxicating beverages at the time of the accident are void.
24 SUBCHAPTER C
25 UNINSURED AND UNDERINSURED MOTORIST COVERAGE
26 Sec.
27 1731. Scope and amount of coverage.
28 1732. Limits of coverage.
29 1733. Priority of recovery.
30 1734. Request for lower or higher limits of coverage.
19890H1165B1336 - 26 -
1 1735. Coverages unaffected by workmen's compensation benefits.
2 1736. Coverages in excess of required amounts.
3 § 1731. Scope and amount of coverage.
4 (a) General rule.--No motor vehicle liability insurance
5 policy shall be delivered or issued for delivery in this
6 Commonwealth with respect to any motor vehicle registered or
7 principally garaged in this Commonwealth to any person who has
8 selected the fault insurance alternative unless uninsured
9 motorist coverage is provided therein or supplemental thereto in
10 such amounts as selected by the named insured but in no event
11 for less than the minimum bodily injury liability limits allowed
12 under this chapter.
13 (b) Uninsured motorist coverage.--Uninsured motorist
14 coverage shall provide protection for persons who suffer injury
15 arising out of the maintenance or use of a motor vehicle and are
16 legally entitled to recover damages therefor from owners or
17 operators of uninsured motor vehicles. Uninsured motorist
18 coverage is optional for persons choosing the no-fault insurance
19 alternative. Uninsured motorist coverage is required for persons
20 choosing the fault insurance coverage.
21 (c) Underinsured motorist coverage.--Underinsured motorist
22 coverage shall provide protection for persons who suffer injury
23 arising out of the maintenance or use of a motor vehicle and are
24 legally entitled to recover damages therefor from owners or
25 operators of underinsured motor vehicles. Underinsured motorist
26 coverage is optional coverage for all insureds.
27 (d) Limitation on recovery.--A person who recovers damages
28 under uninsured motorist coverage or coverages cannot recover
29 damages under underinsured motorist coverage or coverages for
30 the same accident.
19890H1165B1336 - 27 -
1 § 1732. Limits of coverage.
2 Coverages offered under section 1731 (relating to scope and
3 amount of coverage) shall be written for the same limits. No
4 change shall be made in the limits of one of these coverages
5 without an equal change in the limits of the other coverage.
6 § 1733. Priority of recovery.
7 Where multiple policies apply, payment shall be made in the
8 following order of priority:
9 (1) A policy covering a motor vehicle occupied by the
10 injured person at the time of the accident.
11 (2) A policy covering a motor vehicle not involved in
12 the accident with respect to which the injured person is an
13 insured.
14 § 1734. Request for lower or higher limits of coverage.
15 A named insured may request in writing the issuance of
16 coverages under section 1731 (relating to scope and amount of
17 coverage) in amounts less than the limits of liability for
18 bodily injury but in no event less than the amounts required by
19 this chapter for bodily injury. If the named insured has
20 selected uninsured and underinsured motorist coverage in
21 connection with a policy previously issued to him by the same
22 insurer under section 1731, the coverages offered need not be
23 provided in excess of the limits of liability previously issued
24 for uninsured and underinsured motorist coverage unless the
25 named insured requests in writing higher limits of liability for
26 those coverages.
27 § 1735. Coverages unaffected by workmen's compensation
28 benefits.
29 The coverages required by this subchapter shall not be made
30 subject to an exclusion or reduction in amount because of any
19890H1165B1336 - 28 -
1 workmen's compensation benefits payable as a result of the same
2 injury.
3 § 1736. Coverages in excess of required amounts.
4 The coverages provided under this subchapter may be offered
5 by insurers in amounts higher than those required by this
6 chapter but may not be greater than the limits of liability
7 specified in the bodily injury liability provisions of the
8 insured's policy.
9 SUBCHAPTER D
10 ASSIGNED RISK PLAN
11 Sec.
12 1741. Establishment.
13 1742. Scope of plan.
14 1743. Rates.
15 1744. Termination of policies.
16 § 1741. Establishment.
17 The Insurance Department shall, after consultation with the
18 insurers licensed to write motor vehicle liability insurance in
19 this Commonwealth, adopt a reasonable Assigned Risk Plan for the
20 equitable apportionment among those insurers of applicants for
21 motor vehicle liability insurance who are entitled to, but are
22 unable to, procure insurance through ordinary methods. When the
23 plan has been adopted, all motor vehicle liability insurers
24 shall subscribe thereto and shall participate in the plan. The
25 plan may provide reasonable means for the transfer of
26 individuals insured thereunder into the ordinary market, at the
27 same or lower rates, pursuant to regulations established by the
28 department.
29 § 1742. Scope of plan.
30 The Assigned Risk Plan shall:
19890H1165B1336 - 29 -
1 (1) Include rules for the classification of risks and
2 rates therefor.
3 (2) Provide for the installment payment of premiums
4 subject to customary terms and conditions.
5 § 1743. Rates.
6 All rates for the Assigned Risk Plan shall be subject to the
7 act of June 11, 1947 (P.L.538, No.246), known as The Casualty
8 and Surety Rate Regulatory Act, and shall not be inadequate,
9 excessive or unfairly discriminatory.
10 § 1744. Termination of policies.
11 Cancellation, refusal to renew and other termination of
12 policies issued under the Assigned Risk Plan shall be in
13 accordance with the rules of the plan.
14 SUBCHAPTER E
15 ASSIGNED CLAIMS PLAN
16 Sec.
17 1751. Organization.
18 1752. Eligible claimants.
19 1753. Benefits available.
20 1754. Additional coverage.
21 1755. Coordination of benefits.
22 1756. Subrogation.
23 1757. Statute of limitations.
24 § 1751. Organization.
25 Insurers providing financial responsibility as required by
26 law shall organize and maintain, subject to the approval and
27 regulation of the Insurance Department, an Assigned Claims Plan
28 and adopt rules for the operation and for the assessment of
29 costs on a fair and equitable basis.
30 § 1752. Eligible claimants.
19890H1165B1336 - 30 -
1 (a) General rule.--A person is eligible to recover basic
2 benefits from the Assigned Claims Plan if the person meets the
3 following requirements:
4 (1) Is a resident of this Commonwealth.
5 (2) Is injured as the result of a motor vehicle accident
6 occurring in this Commonwealth.
7 (3) Is not an owner of a motor vehicle required to be
8 registered under Chapter 13 (relating to registration of
9 vehicles).
10 (4) Is not the operator or occupant of a motor vehicle
11 owned by the Federal Government or any of its agencies,
12 departments or authorities.
13 (5) Is not the operator or occupant of a motor vehicle
14 owned by a self-insurer or by an individual or entity who or
15 which is immune from liability for, or is not required to
16 provide, benefits or uninsured and underinsured motorist
17 coverage.
18 (6) Is otherwise not entitled to receive any basic
19 benefits under section 1711 (relating to availability of
20 benefits) applicable to the injury arising from the accident.
21 (7) Is not the operator or occupant of a recreational
22 vehicle not intended for highway use, motorcycle, motor-
23 driven cycle or motorized pedalcycle or other like type
24 vehicle required to be registered under this title and
25 involved in the accident.
26 (b) Grounds for ineligibility.--A person otherwise
27 qualifying as an eligible claimant under subsection (a) shall
28 nevertheless be ineligible to recover benefits from the Assigned
29 Claims Plan if that person contributed to his own injury in any
30 of the following ways:
19890H1165B1336 - 31 -
1 (1) While intentionally injuring himself or another or
2 attempting to intentionally injure himself or another.
3 (2) While committing a felony.
4 (3) While seeking to elude lawful apprehension or arrest
5 by a law enforcement official.
6 (4) While knowingly converting a motor vehicle.
7 § 1753. Benefits available.
8 An eligible claimant may recover medical benefits, as
9 described in section 1711 (relating to availability of
10 benefits), up to a maximum of $5,000. No income loss benefit or
11 accidental death benefit shall be payable under this subchapter.
12 Funeral expenses, as described in section 1711, in the amount of
13 $1,500 shall be recoverable as an offset to the maximum amount
14 of medical benefits available under this section.
15 § 1754. Additional coverage.
16 An eligible claimant who has no other source of applicable
17 uninsured motorist coverage and is otherwise entitled to recover
18 in an action in tort against a party who has failed to comply
19 with this chapter may recover for losses or damages suffered as
20 a result of the injury up to $10,000 subject to an aggregate
21 limit for all claims arising out of any one motor vehicle
22 accident of $20,000. If a claimant recovers medical benefits
23 under section 1753 (relating to benefits available), the amount
24 of medical benefits recovered or recoverable up to $5,000 shall
25 be set off against any amounts recoverable in this section.
26 § 1755. Coordination of benefits.
27 (a) Workmen's compensation.--All benefits (less reasonably
28 incurred collection costs) that an eligible claimant receives or
29 is entitled to receive from workmen's compensation and from any
30 other like source under local, state or Federal law shall be
19890H1165B1336 - 32 -
1 subtracted from any benefits available in section 1753 (relating
2 to benefits available) unless the law authorizing or providing
3 for those benefits makes them excess or secondary to the
4 benefits in accordance with this subchapter.
5 (b) Accident and health benefits.--All benefits an eligible
6 claimant receives or is entitled to receive as a result of
7 injury from any available source of accident and health benefits
8 shall be subtracted from those benefits available in section
9 1753.
10 § 1756. Subrogation.
11 The Assigned Claims Plan or its assignee is entitled to
12 recover, in accordance with the tort liability law of this
13 Commonwealth, reimbursement for benefits or coverages paid, loss
14 adjustment costs and any other sums paid to an eligible claimant
15 under this subchapter.
16 § 1757. Statute of limitations.
17 (a) General rule.--An action by an eligible claimant to
18 recover benefits or coverages from the Assigned Claims Plan
19 shall be commenced within four years from the date of the
20 accident.
21 (b) Minors.--For minors entitled to benefits described in
22 section 1753 (relating to benefits available) or 1754 (relating
23 to additional coverage), an action to recover these benefits or
24 coverages shall be commenced within four years from the date on
25 which the injured minor attains 18 years of age.
26 SUBCHAPTER F
27 NONPAYMENT OF JUDGMENTS
28 Sec.
29 1771. Court reports on nonpayment of judgments.
30 1772. Suspension for nonpayment of judgments.
19890H1165B1336 - 33 -
1 1773. Continuation of suspension until judgments paid and
2 proof given.
3 1774. Payments sufficient to satisfy judgments.
4 1775. Installment payment of judgments.
5 § 1771. Court reports on nonpayment of judgments.
6 (a) General rule.--Whenever any person fails within 60 days
7 to satisfy any judgment arising from a motor vehicle accident,
8 the judgment creditor may forward to the department a certified
9 copy of the judgment.
10 (b) Notice to state of nonresident defendant.--If the
11 defendant named in any certified copy of a judgment reported to
12 the department is a nonresident, the department shall transmit a
13 certified copy of the judgment to the official in charge of the
14 issuance of licenses and registration certificates of the state
15 of which the defendant is a resident.
16 § 1772. Suspension for nonpayment of judgments.
17 (a) General rule.--The department, upon receipt of a
18 certified copy of a judgment, shall suspend the operating
19 privilege of each person against whom the judgment was rendered
20 except as otherwise provided in this section and in section 1775
21 (relating to installment payment of judgments).
22 (b) Nonsuspension with consent of judgment creditor.--If the
23 judgment creditor consents in writing, in such form as the
24 department may prescribe, that the judgment debtor's operating
25 privilege be retained or restored, the department shall not
26 suspend or shall restore until the consent is revoked in
27 writing, notwithstanding default in the payment of the judgment,
28 or of any installment thereof prescribed in section 1775,
29 provided the judgment debtor furnishes proof of financial
30 responsibility.
19890H1165B1336 - 34 -
1 (c) Financial responsibility in effect at time of
2 accident.--Any person whose operating privilege has been
3 suspended, or is about to be suspended or become subject to
4 suspension, under this chapter shall be relieved from the effect
5 of the judgment as prescribed in this chapter if the person
6 files evidence satisfactory to the department that financial
7 responsibility was in force and effect at the time of the
8 accident resulting in the judgment and is or should be available
9 for the satisfaction of the judgment. If insurance already
10 obtained is not available because the insurance company has gone
11 into receivership or bankruptcy, the person shall only be
12 required to present to or file with the department proper
13 evidence that an insurance policy was in force and effect at the
14 time of the accident.
15 § 1773. Continuation of suspension until judgments paid and
16 proof given.
17 A person's operating privilege shall remain suspended and
18 shall not be renewed in the name of that person unless and until
19 every judgment is stayed, satisfied in full or to the extent
20 provided in this subchapter, and until the person furnishes
21 proof of financial responsibility as required.
22 § 1774. Payments sufficient to satisfy judgments.
23 (a) General rule.--For the purpose of this chapter only,
24 judgments shall be deemed satisfied upon the occurrence of one
25 of the following:
26 (1) When $10,000 has been credited upon any judgment or
27 judgments rendered in excess of that amount because of injury
28 to one person as the result of any one accident.
29 (2) When $20,000 has been credited upon any judgment or
30 judgments rendered in excess of that amount because of injury
19890H1165B1336 - 35 -
1 to two or more persons as the result of any one accident.
2 (3) When $5,000 has been credited upon any judgment or
3 judgments rendered in excess of that amount because of damage
4 to property of others as the result of any one accident.
5 (b) Credit for payment under settlement.--Payments made in
6 settlement of any claims because of bodily injury or property
7 damage arising from a motor vehicle accident shall be credited
8 in reduction of the amounts provided for in this section.
9 (c) Escrow deposit by judgment debtor.--When the judgment
10 creditor cannot be found, the judgment debtor may deposit in
11 escrow with the prothonotary of the court where the judgment was
12 entered an amount equal to the amount of the judgment, subject
13 to the limits set forth in subsection (a), interest to date and
14 record costs, whereupon the prothonotary shall notify the
15 department and the judgment shall be deemed satisfied. The
16 amount deposited shall be retained by the prothonotary for a
17 period of five years from the date of the deposit, after which,
18 if it has not been claimed by the judgment creditor, it shall be
19 returned to the judgment debtor. When the deposit is made, the
20 prothonotary shall notify the judgment creditor and his counsel,
21 if any, by certified or registered mail at his last known
22 address. No interest shall run on any judgment with respect to
23 the amount deposited with the prothonotary under the terms of
24 this subsection.
25 § 1775. Installment payment of judgments.
26 (a) Order authorizing installment payment.--A judgment
27 debtor, upon due notice to the judgment creditor, may apply to
28 the court in which the judgment was rendered for the privilege
29 of paying the judgment in installments and the court, in its
30 discretion and without prejudice to any other legal remedies
19890H1165B1336 - 36 -
1 which the judgment creditor may have, may so order and fix the
2 amounts and times of payment of the installments.
3 (b) Suspension prohibited during compliance with order.--The
4 department shall not suspend a driver's operating privilege and
5 shall restore any operating privilege suspended following
6 nonpayment of a judgment when the judgment debtor obtains an
7 order permitting payment of the judgment in installments and
8 while the payment of any installment is not in default, provided
9 that the judgment debtor furnishes proof of financial
10 responsibility.
11 (c) Suspension for default in payment.--In the event the
12 judgment debtor fails to pay any installment as specified by the
13 order, then, upon notice of the default, the department shall
14 suspend the operating privilege of the judgment debtor until the
15 judgment is satisfied as provided in this chapter.
16 SUBCHAPTER G
17 PROOF OF FINANCIAL RESPONSIBILITY
18 Sec.
19 1781. Evidence of financial responsibility.
20 1782. Manner of providing proof of financial responsibility.
21 1783. Proof of financial responsibility before restoring
22 operating privilege or registration.
23 1784. Proof of financial responsibility following accident.
24 1785. Self-insurance.
25 § 1781. Evidence of financial responsibility.
26 An applicant for registration of a vehicle shall acknowledge,
27 on a form developed by the Department of Transportation in
28 concert with the Insurance Department, that the applicant knows
29 that the registration of the motor vehicle is conditional upon
30 the continuous maintenance of financial responsibility and that
19890H1165B1336 - 37 -
1 the applicant knows that the failure to maintain satisfactory
2 evidence of financial responsibility on a continuous basis may
3 result in the loss of his operation privilege or motor vehicle
4 registrations, or both.
5 § 1782. Manner of providing proof of financial responsibility.
6 (a) Residents.--
7 (1) Proof of financial responsibility shall be furnished
8 by filing evidence satisfactory to the department that all
9 motor vehicles registered in a person's name are covered by
10 motor vehicle liability insurance or by a program of self-
11 insurance as provided in section 1785 (relating to self-
12 insurance) or other reliable financial arrangements,
13 deposits, resources or commitments acceptable to the
14 department as being the equivalent of motor vehicle liability
15 insurance.
16 (2) The operator of each motor vehicle shall carry in
17 the motor vehicle, at all times the vehicle is operated on
18 the public highways, satisfactory evidence of proof of
19 financial responsibility as may be approved by the
20 department. Such evidence of financial responsibility shall
21 be maintained on a continuous basis during the currency of
22 the registration period. Failure to carry such evidence of
23 proof of financial responsibility is a violation of this
24 chapter. Failure by any person to satisfactorily furnish
25 evidence of proof of financial responsibility, within five
26 consecutive days following the demand of a law enforcement
27 officer, shall be a violation of this chapter, punishable by
28 suspension of the motor vehicle registration or the owner's
29 operator's license, or both.
30 (3) Insurers, subject to the approval of the department,
19890H1165B1336 - 38 -
1 may provide insurance identification cards evidencing proof
2 of financial responsibility. Such identification cards shall
3 be valid for a period not exceeding one year from date of
4 issue. If an insurer shall provide an identification card as
5 proof of financial responsibility for a period of time that
6 is greater than the period of time for which the insurer has
7 received payment of premium, the insurer shall be liable to
8 any third party claiming damages. In such cases, the insurer
9 shall have a right of indemnity against the named insured.
10 (4) Insurers shall, subject to terms and conditions
11 agreed to by the department, inform the department of the
12 cancellation, nonrenewal or other termination of any motor
13 vehicle liability insurance policy for which they have reason
14 to believe was issued to comply with the financial
15 responsibility requirements of this chapter.
16 (5) The registered owner of a motor vehicle shall inform
17 the department when he has knowledge of or reason to believe
18 that the proof of financial responsibility is invalid or has
19 been terminated for any reason. Upon termination or other
20 default in the financial responsibility, the registered owner
21 shall surrender the registration plates to the department
22 within five days following such termination or default unless
23 the registered owner shall obtain other satisfactory evidence
24 of financial responsibility within the five-day period.
25 (b) Nonresident.--The nonresident owner of a motor vehicle
26 not registered in this Commonwealth may give proof of financial
27 responsibility by filing with the department a written
28 certificate or certificates of an insurance company authorized
29 to transact business in the state in which the motor vehicle or
30 motor vehicles described in the certificate are registered or,
19890H1165B1336 - 39 -
1 if the nonresident does not own a motor vehicle, evidence
2 satisfactory to the department that the person does not own a
3 motor vehicle. The department shall accept the certificate upon
4 condition that the insurance company complies with the following
5 provisions with respect to the policies so certified:
6 (1) The insurance company shall execute a power of
7 attorney authorizing the department to accept service on its
8 behalf or process in any action arising out of a motor
9 vehicle accident in this Commonwealth.
10 (2) The insurance company shall agree in writing that
11 the policies shall be deemed to conform with the laws of this
12 Commonwealth relating to the terms of motor vehicle liability
13 policies issued in this Commonwealth.
14 (c) Default by foreign insurance company.--If any insurance
15 company not authorized to transact business in this
16 Commonwealth, which has qualified to furnish proof of financial
17 responsibility, defaults in any undertakings or agreements, the
18 department shall not thereafter accept as proof any certificate
19 of the company whether theretofore filed or thereafter tendered
20 as proof as long as the default continues.
21 § 1783. Proof of financial responsibility before restoring
22 operating privilege or registration.
23 Whenever the department suspends or revokes the operating
24 privilege of any person or the registration of any vehicle
25 pursuant to section 1532 (relating to revocation or suspension
26 of operating privilege), 1542 (relating to revocation of
27 habitual offender's license), 1772 (relating to suspension for
28 nonpayment of judgments), 1782 (relating to manner of providing
29 proof of financial responsibility) or 1784 (relating to proof of
30 financial responsibility following accident), or upon receiving
19890H1165B1336 - 40 -
1 the record of a conviction or forfeiture of bail, the department
2 shall not restore the operating privilege or the applicable
3 registration until the person furnishes proof of financial
4 responsibility.
5 § 1784. Proof of financial responsibility following accident.
6 If the department determines that the owner of a motor
7 vehicle involved in an accident requiring notice to a police
8 department pursuant to section 3746 (relating to immediate
9 notice of accident to police department) did not maintain
10 financial responsibility on the motor vehicle at the time of the
11 accident, the department shall suspend the operating privilege
12 of the owner, where applicable, and the department shall revoke
13 the registration of the vehicle.
14 § 1785. Self-insurance.
15 (a) General rule.--Self-insurance is effected by filing with
16 the Department of Transportation, in satisfactory form, evidence
17 that reliable financial arrangements, deposits, resources or
18 commitments exist such as will satisfy the department that the
19 self-insurer will:
20 (1) Provide the benefits required by section 1711
21 (relating to availability of benefits), subject to the
22 provisions of Subchapter B (relating to motor vehicle
23 insurance basic benefits), except the additional benefits and
24 limits provided in sections 1712 (relating to availability of
25 adequate limits and benefits) and 1715 (relating to exclusion
26 from benefits).
27 (2) Make payments sufficient to satisfy judgments as
28 required by section 1774 (relating to payments sufficient to
29 satisfy judgments).
30 (3) Provide uninsured motorist coverage up to the limits
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1 set forth in section 1774.
2 (b) Stacking limits prohibited.--Any recovery of uninsured
3 motorist benefits under this section only shall not be increased
4 by stacking the limits provided in section 1774, in
5 consideration of the ownership or operation of multiple vehicles
6 or otherwise.
7 (c) Assigned Risk and Assigned Claims Plans.--Self-insurers
8 shall not be required to accept assigned risks pursuant to
9 Subchapter D (relating to Assigned Risk Plan) or contribute to
10 the Assigned Claims Plan pursuant to Subchapter E (relating to
11 Assigned Claims Plan).
12 (d) Promulgation of regulations, etc.--The Department of
13 Transportation may, jointly with the Insurance Department,
14 promulgate rules, regulations, guidelines, procedures or
15 standards for reviewing and establishing the financial
16 eligibility of self-insurers.
17 SUBCHAPTER H
18 MISCELLANEOUS PROVISIONS
19 Sec.
20 1791. Special provisions relating to premiums.
21 1792. Compulsory judicial arbitration jurisdiction.
22 1793. Insurance fraud reporting immunity.
23 1794. Mental or physical examination of person.
24 1795. Customary charges for treatment.
25 1796. Attorney fees and costs.
26 § 1791. Special provisions relating to premiums.
27 (a) Limitation on premium increases.--
28 (1) An insurer shall not increase the premium rate of an
29 owner of a policy of insurance subject to this chapter solely
30 because one or more of the insureds under the policy made a
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1 claim under the policy and was paid thereon unless it is
2 determined that the insured was at fault in contributing to
3 the accident giving rise to the claim.
4 (2) No insurer shall charge an insured who has been
5 convicted of a violation of an offense enumerated in section
6 1535 (relating to schedule of convictions and points) a
7 higher rate for a policy of insurance solely on account of
8 the conviction. An insurer may charge an insured a higher
9 rate for a policy of insurance if a claim is made under
10 paragraph (1).
11 (b) Surcharge disclosure plan.--All insurers shall provide
12 to the insured a surcharge disclosure plan. The insurer
13 providing the surcharge disclosure plan shall detail the
14 provisions of the plan including, but not limited to:
15 (1) A description of conditions that would assess a
16 premium surcharge to an insured along with the estimated
17 increase of the surcharge per policy period per policyholder.
18 (2) The number of years any surcharge will be in effect.
19 The surcharge disclosure plan shall be delivered to each insured
20 by the insurer at least once annually. Additionally, the
21 surcharge information plan shall be given to each prospective
22 insured at the time application is made for motor vehicle
23 insurance coverage.
24 (c) Return of premiums of canceled policies.--When an
25 insurer cancels a motor vehicle insurance policy which is
26 subject to section 6(3) of the act of June 5, 1968 (P.L.140,
27 No.78), relating to writing, cancellation of or refusal to renew
28 policies of automobile insurance, the insurer shall within 30
29 days of canceling the policy return to the insured all premiums
30 paid under the policy less any proration for the period the
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1 policy was in effect. Premiums are overdue if not paid to the
2 insured within 30 days after canceling the policy. Overdue
3 return premiums shall bear interest at the rate of 12% per annum
4 from the date the return premium became due.
5 (d) Rules and regulations.--The Insurance Department shall
6 promulgate rules and regulations establishing guidelines and
7 procedures for determining fault of an insured for the purpose
8 of subsection (a) and guidelines for the content and format of
9 the surcharge disclosure plan.
10 § 1792. Compulsory judicial arbitration jurisdiction.
11 Beginning January 1, 1987, the monetary limit in 42 Pa.C.S. §
12 7361(b)(2)(i) (relating to compulsory arbitration) for the
13 submission of matters to judicial arbitration in judicial
14 districts embracing first and second class counties shall be
15 $25,000 for actions arising from the maintenance or use of a
16 motor vehicle.
17 § 1793. Insurance fraud reporting immunity.
18 (a) General rule.--An insurance company, and any agent,
19 servant or employee acting in the course and scope of his
20 employment, shall be immune from civil or criminal liability
21 arising from the supply or release of written or oral
22 information to any duly authorized Federal or State law
23 enforcement agency, including the Insurance Department, upon
24 compliance with the following:
25 (1) The information is supplied to the agency in
26 connection with an allegation of fraudulent conduct on the
27 part of any person relating to the filing or maintenance of a
28 motor vehicle insurance claim for bodily injury or property
29 damage.
30 (2) The insurance company, agent, servant or employee
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1 has probable cause to believe that the information supplied
2 is reasonably related to the allegation of fraud.
3 (b) Notice to policyholder.--The insurance company shall
4 send written notice to the policyholder or policyholders about
5 whom the information pertains unless the insurance company
6 receives notice that the authorized agency finds, based on
7 specific facts, that there is reason to believe that the
8 information will result in any of the following:
9 (1) Endangerment to the life or physical safety of any
10 person.
11 (2) Flight from prosecution.
12 (3) Destruction of or tampering with evidence.
13 (4) Intimidation of any potential witness or witnesses.
14 (5) Obstruction of or serious jeopardy to an
15 investigation.
16 The insurance company shall send written notice not sooner than
17 45 days nor more than 60 days from the time the information is
18 furnished to an authorized agency except when the authorized
19 agency specifies that a notice should not be sent in accordance
20 with the exceptions enumerated in this subsection in which event
21 the insurance company shall send written notice to the
22 policyholder not sooner than 180 days nor more than 190 days
23 following the date the information is furnished.
24 (c) Immunity for sending notice.--An insurance company or
25 authorized agency and any person acting on behalf of an
26 insurance company or authorized agency complying with or
27 attempting in good faith to comply with subsection (b) shall be
28 immune from civil liability arising out of any acts or omissions
29 in so doing.
30 (d) Applicability.--Nothing in this section shall be
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1 construed to create any rights to privacy or causes of action on
2 behalf of policyholders that are not in existence as of the
3 effective date of this section.
4 § 1794. Mental or physical examination of person.
5 (a) General rule.--Whenever the mental or physical condition
6 of a person is material to any claim for medical or income loss,
7 a court of competent jurisdiction may order the person to submit
8 to a mental or physical examination by a physician. The order
9 may only be made upon motion for good cause shown. The order
10 shall give the person to be examined adequate notice of the time
11 and date of the examination and shall state the manner,
12 conditions and scope of the examination and the physician by
13 whom it is to be performed. If a person fails to comply with an
14 order to be examined, the court or the administrator may order
15 that the person be denied benefits until compliance.
16 (b) Report of examination.--If requested by the person
17 examined, a party causing an examination to be made shall
18 promptly deliver to the person examined a copy of every written
19 report concerning the examination at least one of which must set
20 forth the physician's findings and conclusions in detail. Upon
21 failure to promptly provide copies of these reports, the court
22 or the administrator shall prohibit the testimony of the
23 examining physician in any proceeding to recover benefits.
24 § 1795. Customary charges for treatment.
25 (a) General rule.--A person or institution providing
26 treatment, accommodations, products or services to an injured
27 person for an injury covered by basic benefits shall not make a
28 charge for the treatment, accommodations, products or services
29 in excess of the amount the person or institution customarily
30 charges for like treatment, accommodations, products and
19890H1165B1336 - 46 -
1 services.
2 (b) Provider services contractor.--An insurer providing
3 basic benefits to reimburse the named insured or to pay to any
4 institution providing treatment, accommodations, products or
5 services to a named insured for any injury covered by basic
6 benefits insurance may make arrangements to pay such providers
7 under a purchase of service contract, directly or indirectly,
8 through any other legal entity with a program, group, contract
9 or arrangement approved by the Insurance Commissioner.
10 (c) Peer review organizations.--An insurer or two or more
11 insurers may contract jointly or separately with any peer review
12 organization established for the purpose of evaluating
13 treatment, health care services, products or accommodations
14 provided to any uninjured person. Such evaluation shall be for
15 the purpose of confirming that such treatment, products,
16 services or accommodations conform to the professional standards
17 of performance and that such standards are not in excess of the
18 customary charges for like treatment, accommodations, products
19 or services to others similarly situated.
20 § 1796. Attorney fees and costs.
21 (a) Basis for reasonable fee.--No attorney's fee for
22 representing a claimant in connection with a claim for basic
23 benefits provided under Subchapter B (relating to motor vehicle
24 liability insurance basic benefits) shall be calculated,
25 determined or paid on a contingent fee basis, nor shall any
26 attorney's fees be deducted from the benefits enumerated in this
27 subsection which are otherwise due such claimant. An attorney
28 may charge a claimant a reasonable fee based upon actual time
29 expended.
30 (b) Unreasonable refusal to pay benefits.--In the event an
19890H1165B1336 - 47 -
1 insurer is found to have acted with no reasonable foundation in
2 refusing to pay the benefits enumerated in subsection (a) when
3 due, the insurer shall pay, in addition to the benefits owed and
4 the interest thereon, a reasonable attorney fee based upon
5 actual time expended.
6 (c) Fraudulent or excessive claims.--If, in any action by a
7 claimant to recover benefits under this chapter, the court
8 determines that the claim, or a significant part thereof, is
9 fraudulent or so excessive as to have no reasonable foundation,
10 the court may award the insurer's attorney a reasonable fee
11 based upon actual time expended. The court, in such case, may
12 direct that the fee shall be paid by the claimant or that the
13 fee may be treated in whole or in part as an offset against any
14 benefits due or to become due the claimant.
15 Section 4. This act shall take effect as follows:
16 (1) Section 1 of this act shall take effect immediately.
17 (2) Sections 2 and 3 of this act shall take effect
18 January 1, 1991.
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