Download This Bill in Microsoft Word format

Bill 475

                    Current Status

Bill Number:                      475
Type of Legislation:              General Bill GB
Introducing Body:                 Senate
Introduced Date:                  19990209
Primary Sponsor:                  Peeler
All Sponsors:                     Peeler
Drafted Document Number:          l:\council\bills\nbd\11105jm99.doc
Residing Body:                    Senate
Current Committee:                Banking and Insurance Committee 02 SBI
Subject:                          Insurance Department Commissioner, 
                                  election of; Motor Vehicle Safety, Financial 
                                  Responsibility; Reinsurance Facility


                        History

Body    Date      Action Description                     Com     Leg Involved
______  ________  ______________________________________ _______ ____________
Senate  19990209  Introduced, read first time,           02 SBI
                  referred to Committee


                             Versions of This Bill

TO AMEND TITLE 38, CODE OF LAWS OF SOUTH CAROLINA, 1976, RELATING TO INSURANCE, BY ADDING CHAPTERS 95 AND 97 SO AS TO ADOPT THE NORTH CAROLINA PROVISIONS OF LAW REGARDING MOTOR VEHICLE SAFETY, FINANCIAL RESPONSIBILITY, AND INSURANCE AND A MOTOR VEHICLE REINSURANCE FACILITY AS THE LAW OF THIS STATE AND TO CONFORM THE NORTH CAROLINA PROVISIONS TO SOUTH CAROLINA'S INSURANCE CODE; TO AMEND SECTION 1-30-10, AS AMENDED, RELATING TO THE DEPARTMENTS OF STATE GOVERNMENT, SO AS TO PROVIDE THAT THE GOVERNING AUTHORITY OF THE DEPARTMENT OF INSURANCE SHALL BE THE "COMMISSIONER OF INSURANCE" ELECTED TO OFFICE UNDER THE LAWS OF THIS STATE; TO AMEND SECTION 38-1-20, AS AMENDED, RELATING TO DEFINITIONS UNDER THE INSURANCE LAWS OF THIS STATE, SO AS TO DELETE THE DEFINITION OF "DIRECTOR" OF THE DEPARTMENT OF INSURANCE AND SUBSTITUTE THEREFOR "COMMISSIONER OF INSURANCE"; TO AMEND SECTION 38-3-10, AS AMENDED, RELATING TO THE DEPARTMENT OF INSURANCE, SO AS TO DELETE CERTAIN PROVISIONS RELATING TO THE DEPARTMENT'S DIRECTOR, PROVIDE THAT THE "COMMISSIONER OF INSURANCE" SHALL BE ELECTED RATHER THAN APPOINTED, AND MAKE CHANGES IN THE PROVISIONS CONCERNING THE REMOVAL OF THIS OFFICIAL; TO AMEND SECTION 38-3-100, AS AMENDED, RELATING TO THE DIRECTOR OF THE DEPARTMENT OF INSURANCE, SO AS TO, AMONG OTHER CHANGES, SUBSTITUTE "COMMISSIONER OF INSURANCE" FOR "DIRECTOR OF THE DEPARTMENT OF INSURANCE" AND DELETE THE REQUIREMENT THAT, IF THE COMMISSIONER BECOMES A CANDIDATE FOR PUBLIC OFFICE OR BECOMES A MEMBER OF A POLITICAL COMMITTEE DURING TENURE, HIS OFFICE MUST BE IMMEDIATELY VACATED; TO AMEND THE 1976 CODE BY ADDING SECTION 38-3-102 SO AS TO PROVIDE THAT THE COMMISSIONER OF INSURANCE MUST BE ELECTED TO OFFICE BY THE QUALIFIED ELECTORS OF THE STATE IN THE GENERAL ELECTION AND PROVIDE FOR THE COMMISSIONER'S TERM OF OFFICE, QUALIFICATIONS, VACANCIES, AND RELATED MATTERS; AND TO PROVIDE THAT THE ELECTION OF THE COMMISSIONER OF INSURANCE BEGINS WITH AN INITIAL TWO-YEAR TERM OF OFFICE VOTED ON IN THE YEAR 2000 TO BE FOLLOWED BY A FULL FOUR-YEAR TERM VOTED ON IN 2002 AND EVERY FOUR YEARS THEREAFTER AND THAT THE DIRECTOR SERVING ON THE EFFECTIVE DATE OF THIS ACT SHALL CONTINUE TO SERVE UNTIL HIS SUCCESSOR IS ELECTED AND QUALIFIES FOR OFFICE AS COMMISSIONER OF INSURANCE; TO PROVIDE THAT EVERY REFERENCE TO "DIRECTOR OF THE DEPARTMENT OF INSURANCE" IN THE 1976 CODE SHALL BE DEEMED TO MEAN "COMMISSIONER OF INSURANCE"; TO AUTHORIZE AND DIRECT THE CODE COMMISSIONER TO CHANGE CERTAIN REFERENCES; TO REPEAL ACT 154 OF 1997, RELATING TO THE REVISION OF THE SOUTH CAROLINA LAW ON AUTOMOBILE INSURANCE; TO REPEAL ARTICLES 13 AND 15, CHAPTER 73 OF TITLE 38, RELATING TO THE PROVISIONS REGARDING ADVISORY ORGANIZATIONS AND JOINT UNDERWRITING OR JOINT REINSURANCE UNDER THE INSURANCE LAW ON PROPERTY, CASUALTY, INLAND MARINE, AND SURETY RATES; TO REPEAL ARTICLE 3, CHAPTER 77 OF TITLE 38, RELATING TO THE LAW ON AUTOMOBILE INSURANCE AND THE "MANDATE TO WRITE" AND INSURANCE COVERAGES; TO REPEAL ARTICLE 5, CHAPTER 77 OF TITLE 38, RELATING TO THE SOUTH CAROLINA REINSURANCE FACILITY AND DESIGNATED PRODUCERS; AND TO REPEAL CHAPTER 9 OF TITLE 56, RELATING TO MOTOR VEHICLE FINANCIAL RESPONSIBILITY PROVISIONS, AND CHAPTER 10 OF TITLE 56, RELATING TO MOTOR VEHICLE REGISTRATION AND FINANCIAL SECURITY PROVISIONS.

Be it enacted by the General Assembly of the State of South Carolina:

SECTION 1. Title 38 of the 1976 Code is amended by adding:

"Section 38-95-10. The following words and phrases when used in this chapter shall, for the purposes of this chapter, have the meanings respectively ascribed to them in this section, except in those instances where the context clearly indicates a different meaning:

(1) [Reserved]

(2) [Reserved]

(3) 'Judgment': Any judgment which shall have become final by expiration without appeal of the time within which an appeal might have been perfected, or by final affirmation on appeal, rendered by a court of competent jurisdiction of any state or of the United States, upon a cause of action arising out of the ownership, maintenance, or use of any motor vehicle, for damages, including damages for care and loss of services, because of bodily injury to or death of any person, or for damages because of injury to or destruction of property, including the loss of use thereof, or upon a cause of action on an agreement of settlement for such damages.

(4) [Reserved]

(5) [Reserved]

(6) [Reserved]

(7) 'Nonresident's operating privilege': The privilege conferred upon a nonresident by the laws of this State pertaining to the operation by him of a motor vehicle in this State.

(8) [Reserved]

(9) [Reserved]

(10) [Reserved]

(11) 'Proof of financial responsibility': Proof of ability to respond in damages for liability, on account of accidents occurring subsequent to the effective date of said proof, arising out of the ownership, maintenance, or use of a motor vehicle, in the amount of twenty-five thousand dollars because of bodily injury to or death of one person in any one accident, and, subject to said limit for one person, in the amount of fifty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and in the amount of fifteen thousand dollars because of injury to or destruction of property of others in any one accident. Nothing contained herein shall prevent an insurer and an insured from entering into a contract, not affecting third parties, providing for a deductible as to property damage at a rate approved by the Commissioner of Insurance.

(12) 'Commissioner': The Commissioner of Insurance of the State of South Carolina.

Section 38-95-20. (a) The commissioner shall administer and enforce the provisions of this chapter and may promulgate regulations necessary for its administration and shall provide for hearings upon request of persons aggrieved by orders or acts of the commissioner under the provisions of this chapter.

(b) Any person aggrieved by an order or act of the commissioner requiring a suspension or revocation of his license under the provisions of this chapter, or requiring the posting of security as provided in this chapter, or requiring the furnishing of proof of financial responsibility, may file a petition in the court of common pleas of the county in which the petitioner resides for a review, and the commencement of such a proceeding shall suspend the order or act of the commissioner pending the final determination of the review. A copy of such petition shall be served upon the commissioner, and the commissioner shall have twenty days after such service in which to file an answer. The appeal shall be heard in said county by the judge holding court in said county. At the hearing upon the petition the judge shall sit without the intervention of a jury and shall receive such evidence as shall be deemed by the judge to be relevant and proper. Except as otherwise provided in this section, upon the filing of the petition herein provided for, the procedure shall be the same as in civil actions.

The matter shall be heard de novo and the judge shall enter his order affirming the act or order of the commissioner, or modifying same, including the amount of bond or security to be given by the petitioner. If the court is of the opinion that the petitioner was probably not guilty of negligence or that the negligence of the other party was probably the sole proximate cause of the collision, the judge shall reverse the act or order of the commissioner. Either party may appeal from such order to the Court of Appeals in the same manner as in other appeals from the circuit court and the appeal shall have the effect of further staying the act or order of the commissioner requiring a suspension or revocation of the petitioner's license.

No act or order given or rendered in any proceeding hereunder shall be admitted or used in any other civil or criminal action.

Section 38-95-30. The commissioner shall upon request furnish any person a certified abstract of the operating record of any person required to comply with the provisions of this chapter, which abstract shall also fully designate the motor vehicle, if any, registered in the name of such person, and if there shall be no record of any conviction of such person of violating any law relating to the operation of a motor vehicle or of any injury or damage caused by such person, the commissioner shall so certify.

Section 38-95-40. In case of an accident in which any person is killed or injured or in which total property damage is five hundred dollars or more, the report required by law shall contain information to enable the commissioner to determine whether the requirements for the deposit of security are inapplicable by reason of the existence of insurance or other exceptions specified in this chapter. The commissioner may rely upon the accuracy of the information unless and until he has reason to believe that the information is erroneous. The operator or the owner shall furnish such additional relevant information as the commissioner shall require.

Section 38-95-50. (a) If at the expiration of twenty days after the receipt of a report of a motor vehicle accident within this State which has resulted in bodily injury or death or total property damage in excess of five hundred dollars, the commissioner does not have on file evidence satisfactory to him that the person who would otherwise be required to file security under subsection (b) of this section has been released from liability, or has been finally adjudicated not to be liable or has executed a duly acknowledged written agreement providing for the payment of an agreed amount, in installments or otherwise, or is for any other reason not required to file security under this chapter with respect to all claims for injuries or damages resulting from the accident, the commissioner shall determine the amount of security which shall be sufficient in his opinion to satisfy any judgement or judgments for damages resulting from such accident as may be recovered against each operator or owner.

(b) The commissioner shall, within sixty days after the receipt of such report of a motor vehicle accident, suspend the license of each operator and each owner of a motor vehicle in any manner involved in such accident, and if such operator or owner is a nonresident the privilege of operating a motor vehicle within this State, unless such operator or owner, or both, shall deposit security in the sum so determined by the commissioner; provided, notice of such suspension shall be sent by the commissioner to such operator and owner not less than ten days prior to the effective date of such suspension and shall state the amount required as security; provided further, the provisions of this chapter requiring the deposit of security and the suspension of license for failure to deposit security shall not apply to an operator or owner who would otherwise be required to deposit security in an amount not in excess of one hundred dollars. Where erroneous information is given the commissioner with respect to the matters set forth in subdivisions (1), (2) or (3) of subsection (c) of this section or with respect to the ownership or operation of the vehicle, the extent of damage and injuries, or any other matters which would have affected the commissioner's action had the information been previously submitted, he shall take appropriate action as hereinbefore provided, within sixty days after receipt by him of correct information with respect to said matters. The commissioner, upon request and in his discretion, may postpone the effective date of the suspension provided in this section by fifteen days if, in his opinion, such extension would aid in accomplishing settlements of claims by persons involved in accidents.

(c) This section shall not apply:

(1) To such operator or owner if such owner had in effect at the time of such accident an automobile liability policy with respect to the motor vehicle involved in such accident;

(2) To such operator, if not the owner of such motor vehicle, if there was in effect at the time of such accident a motor vehicle liability policy or bond with respect to his operation of motor vehicles not owned by him;

(3) To such operator or owner if the liability of such operator of owner for damages resulting from such accident is, in the judgment of the commissioner, covered by any other form of liability insurance policy or bond or sinking fund or group assumption of liability;

(4) To any person qualifying as a self-insurer, nor to any operator for a self-insurer if, in the opinion of the commissioner from the information furnished him, the operator at the time of the accident was probably operating the vehicle in the course of the operator's employment as an employee or officer of the self-insurer; nor

(5) To any employee of the United States government while operating a vehicle in its service and while acting within the scope of his employment, such operations being fully protected by the Federal Tort Claims Act of 1946, which affords ample security to all persons sustaining personal injuries or property damage through the negligence of such federal employee.

No such policy or bond shall be effective under this section unless issued by an insurance company or surety company authorized to do business in this State, except that if such motor vehicle was not registered in this State, or was a motor vehicle which was registered elsewhere than in this State at the effective date of the policy or bond, or the most recent renewal thereof, or if such operator not an owner was a nonresident of this State, such policy or bond shall not be effective under this section unless the insurance company or surety company if not authorized to do business in this State shall execute a power of attorney authorizing the commissioner to accept service on its behalf of notice or process in any action upon such policy or bond arising out of such accident and unless said insurance company or surety company, if not authorized to do business in this State, is authorized to do business in the state or other jurisdiction where the motor vehicle is registered or, if such policy or bond is filed on behalf of an operator not an owner who was a nonresident of this State, unless said insurance company or surety company, if not authorized to do business in this State, is authorized to do business in the state or other jurisdiction of residence of such operator; provided, however, every such policy or bond is subject, if the accident has resulted in bodily injury or death, to a limit, exclusive of interest and costs, of not less than twenty-five thousand dollars because of bodily injury to or death of one person in any one accident and, subject to said limit for one person, to a limit of not less than fifty thousand dollars because of bodily injury to or death of two or more person in any one accident, and, if the accident has resulted in injury to or destruction of property, to a limit of not less than fifteen thousand dollars because of injury to or destruction of property of others in any one accident.

Section 38-95-60. The requirements as to security and suspension in this chapter shall not apply:

(1) To the operator or the owner of a motor vehicle involved in an accident wherein no injury or damage was caused to the person or property of anyone other than such operator or owner.

(2) To the operator or the owner of a motor vehicle legally parked at the time of the accident;

(3) To the owner of a motor vehicle if at the time of the accident the vehicle was being operated without his permission, express or implied, or was parked by a person who had been operating such motor vehicle without such permission;

(4) If, prior to the date that the commissioner would otherwise suspend the license or the nonresident's operating privilege, there shall be filed with the commissioner evidence satisfactory to him that the person who would otherwise have to file security has been released from liability or been finally adjudicated not to be liable or has executed a duly acknowledged written agreement providing for the payment of an agreed amount, in installments or otherwise, with respect to all claims for injuries or damages resulting from the accident;

(5) If, prior to the date that the commissioner would otherwise suspend the license or the nonresident's operating privilege, there shall be filed with the commissioner evidence satisfactory to him that the person who would otherwise be required to file security has in any manner settled the claims of the other persons involved in the accident and if the commissioner determines that, considering the circumstances of the accident and the settlement, the purposes of this chapter and of protection of operators and owners of other motor vehicles are best accomplished by not requiring the posting of security or the suspension of the license. For the purpose of administering this subdivision, the commissioner may consider a settlement made by an insurance company as the equivalent of a settlement made directly by the insured; nor

(6) If, prior to the date that the commissioner would otherwise suspend the license or the nonresident's operating privilege, there shall be filed with the commissioner evidence satisfactory to him that another person involved in the accident has been convicted by a court of competent jurisdiction of a crime involving the operation a motor vehicle at the time of the accident, and if the commissioner in his discretion determines, after considering the circumstances of the accident or the nature and the circumstances of the crime, that the purpose of this chapter and of protection of operators and owners of other motor vehicles is best accomplished by not requiring the posting of security or the suspension of the license.

Section 38-95-70. In determining whether or not any of the exceptions set forth in this chapter have been satisfied, in the case of accidents involving minors the commissioner may accept, for the purpose of this chapter only, as valid releases on account of claims for injuries to minors or damage to the property of minors releases which have been executed by the parent of the minor having custody of the minor or by the guardian of the minor if there be one. In the case of an emancipated minor, the commissioner may accept a release signed by or a settlement agreed upon by the minor without the approval of the parents of the minor. If in the opinion of the commissioner the circumstances of the accident, the nature and extent of the injuries or damage, or any other circumstances make it advisable for the best protection of the interest of the minor, the commissioner may decline to accept such releases or settlements and may require the approval of the circuit court.

Section 38-95-80. The license and nonresident's operating privilege suspended as provided in this chapter shall remain suspended and shall not be renewed nor shall any such license be issued to such person until:

(1) Such person shall deposit or there shall be deposited on his behalf the security required under this chapter;

(2) One year shall have elapsed following the date of such suspension and evidence satisfactory to the commissioner has been filed with him that during such period no action for damages arising out of the accident has been instituted; or

(3) Evidence satisfactory to the commissioner has been filed with him of release from liability, or a final adjudication of nonliability, or a duly acknowledged written agreement, or a settlement accepted by the commissioner, or a conviction accepted by the commissioner; provided, if there is a default in the payment of any installment or sum under a duly acknowledged written agreement, the commissioner shall, upon notice of the default, immediately suspend the license or nonresident's operating privilege of the defaulting person and may not restore it until:

(a) That person deposits and thereafter maintains security in an amount determined by the commissioner; or

(b) That person files evidence satisfactory to the commissioner of a new duly acknowledged written agreement or settlement.

Section 38-95-90. (a) In case the operator or the owner of a motor vehicle involved in an accident within this State has no license, or is a nonresident, he shall not be allowed a license until he has complied with the requirements of this chapter to the same extent that it would be necessary if, at the time of the accident, he had held a license.

(b) When a nonresident's operating privilege is suspended, the commissioner shall transmit a certified copy of the record of such action to the official in charge of the issuance of licenses in the state in which such nonresident resides, if the law of such other state provides for action in relation thereto similar to that provided for in subsection (c) of this section.

(c) Upon receipt of such certification that the operating privilege of a resident of this State has been suspended or revoked in any such other state pursuant to a law providing for its suspension or revocation for failure to deposit security for the payment of judgments arising out of a motor vehicle accident, under circumstances which would require the commissioner to suspend a nonresident's operating privilege had the accident occurred in this State, the commissioner shall suspend the license of such resident. Such suspension shall continue until such resident furnishes evidence of his compliance with the law of such other state relating to the deposit of such security.

Section 38-95-100. The security required under this chapter shall be in such form and in such amount as the commissioner may require but in no case in excess of the limits specified in this chapter in reference to the acceptable limits of a policy or bond. The person depositing security shall specify in writing the person or persons on whose behalf the deposit is made and, at any time while such deposit is in the custody of the commissioner or State Treasurer, the person depositing it may, in writing, amend the specification of the person or persons on whose behalf the deposit is made to include an additional person or persons; provided, however, that a single deposit of security shall be applicable only on behalf of persons required to furnish security because of the same accident.

The commissioner may reduce the amount of security ordered in any case if, in his judgment, the amount ordered is excessive. In case the security originally ordered has been deposited, the excess deposited over the reduced amount ordered shall be returned to the depositor or his personal representative immediately.

Section 38-95-110. (a) Security deposited in compliance with the requirements of this chapter shall be placed by the commissioner in the custody of the State Treasurer and shall be applicable only to the payment of a judgment or judgments rendered against the person or persons on whose behalf the deposit was made, for damages arising out of the accident in question in an action at law, begun not later than one year after the date of such accident, or within one year after the date of deposit of any security under this chapter, or to the payment in settlement, agreed to by the depositor, of a claim or claims arising out of such accident. Such deposit or any balance thereof shall be returned to the depositor or his personal representative when evidence satisfactory to the commissioner has been filed with him that there has been a release from liability, or final adjudication of nonliability, or a duly acknowledged agreement or a settlement accepted by the commissioner, or a conviction accepted by the commissioner, or whenever, after the expiration of one year from the date of the accident, or from the date of deposit of any security, whichever is later, the commissioner shall be given reasonable evidence that there is no such action pending and no judgment rendered in such action left unpaid.

(b) One year from the deposit of any security under the terms of this chapter the commissioner shall notify the depositor thereof by registered mail addressed to his last known address that the depositor is entitled to a refund of the security upon giving reasonable evidence that no action at law for damages arising out of the accident in question is pending or that no judgment rendered in any such action remains unpaid. If, at the end of three years from the date of deposit, no claim therefor has been received, the Department of Insurance shall notify the depositor thereof by registered mail and shall cause a notice to be posted at the courthouse door of the county in which is located the last know address of the depositor for a period of sixty days. Such notice shall contain the name of the depositor, his last know address, the date, amount, and nature of the deposit and shall state the conditions under which the deposit will be refunded. If, at the end of two years from the date of posting of such notice, no claim for the deposit has been received, the commissioner shall certify such fact together with the facts of notice to the State Treasurer. These deposits shall be tuned over to the Escheat Fund of the Office of the State Treasurer.

Section 38-95-120. Neither the report required by this chapter, the action taken by the commissioner pursuant to this chapter, the findings, if any, of the commissioner upon which such action is based, or the security filed as provided in this chapter shall be referred to in any way, nor be any evidence of the negligence of due care of either party, at the trial of any action at law to recover damages.

Section 38-95-130. Whenever any person fails within sixty days to satisfy any judgment, upon the written request of the judgment creditor or his attorney, it shall be the duty of the clerk of court, of the county in which any such judgment is rendered within this State to forward to the commissioner immediately after the expiration of said sixty days a certified copy of such judgment.

If the defendant named in any certified copy of a judgment reported to the commissioner is a nonresident, the commissioner shall transmit a certified copy of the judgment to the official in charge of the issuance of licenses and registration certificates of the state of which the defendant is a resident.

Section 38-95-140. (a) The commissioner, upon the receipt of a certified copy of a judgment which has remained unsatisfied for a period of sixty days shall immediately suspend the license and any nonresident's operating privilege of any person against whom such judgment was rendered, except as hereinafter otherwise provided in this section.

(b) The commissioner shall not, however, revoke or suspend the license of an owner of driver if the insurance carried by him was in a company which was authorized to transact business in this State and which subsequent to an accident involving the owner of operator and prior to settlement of the claim therefor went into liquidation, so that the owner or driver is thereby unable to satisfy the judgment arising out of the accident.

(c) If the judgment creditor consents in writing, in such form as the commissioner may prescribe, that the judgment debtor be allowed a license or a nonresident's operating privilege, the same may be allowed by the commissioner, in his discretion, for six months from the date of such consent and thereafter until such consent is revoked in writing, notwithstanding default in the payment of such judgment or of any installments thereof.

Section 38-95-150. Such license and nonresident's operating privilege shall remain so suspended and shall not be renewed, nor shall any such license be thereafter issued in the name of such person, including any such person not previously licensed, unless and until every such judgment:

(1) Is stayed;

(2) Is satisfied in full;

(3) Is subject to the exemptions stated in this chapter;

(4) Is barred from enforcement by the statute of limitations; or

(5) Is discharged in bankruptcy.

Section 38-95-160. In addition to other methods of satisfaction provided by law, judgments herein referred to shall, for the purpose of this chapter, be deemed satisfied:

(1) When twenty-five thousand dollars has been credited upon any judgment or judgments rendered in excess of that amount because of bodily injury to or death of one person as the result of any one accident;

(2) When subject to such limit of twenty-five thousand dollars because of bodily injury to or death of one person, the sum of fifty thousand dollars has been credited upon any judgment or judgments rendered in excess of that amount because of bodily injury to or death of two or more persons as the result of any one accident; or

(3) When fifteen thousand dollars has been credited upon any judgment or judgments rendered in excess of that amount because of injury to or destruction of property of others as a result of any one accident;

Provided, however, payments made in settlement of any claims because of bodily injury, death, or property damage arising from a motor vehicle accident shall be credited in reduction of the amounts provided for in this section.

Section 38-95-170. (a) A judgment debtor upon due notice to the judgment creditor may apply to the court in which such judgment was rendered for the privilege of paying such judgment in installments and the court, in its discretion and without prejudice to any other legal remedies which the judgment creditor may have, may so order and fix the amounts and times of payment of the installments.

(b) The commissioner shall not suspend a license or a nonresident's operating privilege and shall restore any license or nonresident's operating privilege suspended following nonpayment of a judgment when the judgment debtor obtains such an order permitting the payment of such judgment in installments and while the payment of any said installment is not in default.

(c) In the event the judgment debtor fails to pay any installment as specified by such order, then, upon notice of such default, the commissioner shall immediately suspend the license or nonresident's operating privilege of the judgment debtor until such

judgment is satisfied, as provided in this chapter.

Section 38-95-180. Proof of financial responsibility when required under this chapter with respect to a motor vehicle or with respect to a person who is not the owner of a motor vehicle may be given by filing:

(1) A certificate of insurance;

(2) A bond;

(3) A certificate of deposit of money or securities; or

(4) A certificate of self-insurance supplemented by an agreement by the self-insurer that, with respect to accidents occurring while the certificate is in force, he will pay the same judgments and in the same amounts that an insurer would have been obligated to pay under an owner's motor vehicle liability policy if it had issued such a policy to said self-insurer.

Section 38-95-190. Proof of financial responsibility may be furnished by filing with the commissioner the written certificate of any insurance carrier duly authorized to do business in this State certifying that there is in effect a motor vehicle liability policy for the benefit of the person required to furnish proof of financial responsibility. Such certificate shall give the effective date of such motor vehicle liability policy and shall designate by explicit description or by appropriate reference all motor vehicles covered thereby, unless the policy is issued to a person who is not the owner of a motor vehicle. The commissioner may require that certificates filed pursuant to this section be on a form approved by him.

Section 38-95-200. (a) The nonresident owner of a motor vehicle not registered in this State may give proof of financial responsibility by filing with the commissioner a written certificate or certificates of an insurance carrier authorized to transact business in the state in which the motor vehicle described in such certificate is registered or, if such nonresident does not own a motor vehicle, then in the state in which the insured resides; provided, such certificate otherwise conforms to the provisions of this chapter, and the commissioner shall accept the same upon condition that said insurance carrier complies with the following provisions with respect to the policies so certified:

(1) Said insurance carrier shall execute a power of attorney authorizing the commissioner to accept service on its behalf of notice or process in any action arising out of a motor vehicle accident in this State; and

(2) Said insurance carrier shall agree in writing that such policies shall be deemed to conform with the laws of this State relating to the terms of motor vehicle liability policies issued herein.

(b) If any insurance carrier not authorized to transact business in this State, which has qualified to furnish proof of financial responsibility, defaults in any said undertakings or agreements, the commissioner shall not thereafter accept as proof any certificate of said carrier whether theretofore filed or thereafter tendered as proof, so long as such default continues.

(c) The commissioner may require that certificates and powers filed pursuant to this section be on forms approved by the commissioner.

Section 38-95-210. (a) A 'motor vehicle liability policy', as said term is used in this chapter, shall mean an owner's or an operator's policy of liability insurance, certified as provided in this chapter as proof of financial responsibility, and issued, except as otherwise provided, by an insurance carrier duly authorized to transact business in this State, to or for the benefit of the person named therein as insured.

(b) Such owner's policy of liability insurance:

(1) Shall designate by explicit description or by appropriate reference all motor vehicles with respect to which coverage is thereby to be granted;

(2) Shall insure the person named therein, and any other person, as insured, using any such motor vehicle or motor vehicles with the express or implied permission of such named insured, or any other person in lawful possession, against loss from the liability imposed by law for damages arising out of the ownership, maintenance, or use of such motor vehicle or motor vehicles within the United States of America or the Dominion of Canada, subject to limits exclusive of interest and costs, with respect to each such motor vehicle, as follows: twenty-five thousand dollars because of bodily injury to or death of one person in any one accident and, subject to said limit for one person, fifty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and fifteen thousand dollars because of injury to or destruction of property of others in any one accident; and

(3) No policy of bodily injury liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle shall be delivered or issued for delivery in this State with respect to any motor vehicle registered or principally garaged in this State unless coverage provided therein or supplemental thereto, under provisions filed with and approved by the Commissioner of Insurance, for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles and hit-and-run motor vehicles because of bodily injury, sickness, or disease, including death, resulting therefrom, in an amount not to be less than the financial responsibility amounts for bodily injury liability nor greater than one million dollars, as selected by the policy owner. The provisions shall include coverage for the protection of persons insured thereunder who are legally entitled to recover damages from owners or operators of uninsured motor vehicles because of injury to or destruction of the property of such insured, with a limit in the aggregate for all insureds in any one accident of up to the limits of property damage liability in the owner's policy of liability insurance, and subject, for each insured, to an exclusion of the first one hundred dollars of such damages. The provisions shall further provide that a written statement by the liability insurer, whose name appears on the certification of financial responsibility made by the owner of any vehicle involved in an accident with the insured, that the other motor vehicle was not covered by insurance at the time of the accident with the insured shall operate as a prima facie presumption that the operator of the motor vehicle was uninsured at the time of the accident with the insured for the purposes of recovery under this provision of the insured's liability insurance policy. The coverage required under this subdivision is not applicable where any insured named in the policy rejects the coverage. An insured named in the policy may select different coverage limits as provided in this subdivision. If the named insured in the policy does not reject uninsured motorist coverage and does not select different coverage limits, the amount of uninsured motorist coverage shall be equal to the highest limit of bodily injury and property damage liability coverage for any one vehicle in the policy. Once the option to reject the uninsured motorist coverage or to select different coverage limits is offered by the insurer, the insurer is not required to offer the option in any renewal, reinstatement, substitute, amended, altered, modified, transfer, or replacement policy unless the named insured makes a written request to exercise a different option. The selection or rejection of uninsured motorist coverage or the failure to select or reject by a named insured is valid and binding on all insureds and vehicles under the policy. Rejection of or selection of different coverage limits for uninsured motorist coverage for policies under the jurisdiction of the State Rating and Statistical Division shall be made in writing by a named insured on a form promulgated by the division and approved by the Commissioner of Insurance.

Where coverage is provided on more than one vehicle insured on the same policy or where the owner or the named insured has more than one policy with coverage under this subdivision, there shall not be permitted any combination of coverage within a policy or where more than one policy may apply to determine the total amount of coverage available.

In addition to the above requirements relating to uninsured motorist insurance, every policy of bodily injury liability insurance covering liability arising out of the ownership, maintenance, or use of any motor vehicle, which policy is delivered or issued for delivery in this State, shall be subject to the following provisions which need not be contained therein:

(a) A provision that the insurer shall be bound by a final judgment taken by the insured against an uninsured motorist if the insurer has been served with a copy of the summons, complaint, or other process in the action against the uninsured motorist by registered or certified mail, return receipt requested, or in any other manner provided by law; provided however, that the determination of whether a motorist is uninsured may be decided only by an action against the insurer alone. The insurer, upon being served as herein provided, shall be a party to the action between the insured and the uninsured motorist though not named in the caption of the pleadings and may defend the suit in the name of the uninsured motorist or in its own name. The insurer, upon being served with a copy of the summons, complaint, or other pleading, shall have the time allowed by statute in which to answer, demur, or otherwise plead (whether the pleading is verified or not) to the summons, complaint, or other process served upon it. The consent of the insurer shall not be required for the initiation of suit by the insured against the uninsured motorist. However, no action shall be initiated by the insured until sixty days following the posting of notice to the insurer at the address shown on the policy of after personal delivery of the notice to the insurer or its agent setting forth the belief of the insured that the prospective defendant or defendants are uninsured motorists. No default judgment shall be entered when the insurer has timely filed an answer or other pleading as required by law. The failure to post notice to the insurer sixty days in advance of the initiation of suit shall not be grounds for dismissal of the action but shall automatically extend the time for the filing of an answer or other pleadings to sixty days after the time of service of the summons, complaint, or other process on the insurer.

(b) Where the insured, under the uninsured motorist coverage, claims that he has sustained bodily injury as the result of a collision between motor vehicles and asserts that the identity of the operator or owner of a vehicle (other than a vehicle in which the insured is a passenger) cannot be ascertained, the insured may institute an action directly against the insurer. In that event, the insured or someone in his behalf shall report the accident within twenty-four hours, or as soon thereafter as may be practicable, to a police officer, peace officer, other judicial officer, or to the head of the Division of Motor Vehicles. The insured shall also, within a reasonable time, give notice to the insurer of his injury and the extent thereof and shall set forth in the notice the time, date, and place of the injury. Thereafter, on forms to be mailed by the insurer within fifteen days following receipt of the notice of the accident to the insurer, the insured shall furnish to the insurer any further reasonable information concerning the accident and the injury that the insurer requests. If the forms are not furnished within fifteen days, the insured is deemed to have complied with the requirements for furnishing information to the insurer. Suit may not be instituted against the insurer in less than sixty days from the posting of the first notice of the injury or accident to the insurer at the address shown on the policy or after personal delivery of the notice to the insurer or its agent. The failure to post notice to the insurer sixty days before the initiation of the suit shall not be ground for dismissal of the action but shall automatically extend the time for filing of an answer or other pleadings to sixty days after the time of service of the summons, complaint, or other process on the insurer.

Under this section the term 'uninsured motor vehicle' shall include, but not be limited to, an insured motor vehicle where the liability insurer thereof is unable to make payment with respect to the legal liability within the limits specified therein because of insolvency.

An insurer's insolvency protection shall be applicable only to accidents occurring during a policy period in which its insured's uninsured motorist coverage is in effect where the liability insurer of the tort-feasor becomes insolvent within three years after such an accident. Nothing herein shall be construed to prevent any insurer from affording insolvency protection under terms and conditions more favorable to the insured than is provided herein.

In the event of payment to any person under the coverage required by this section and subject to the terms and conditions of coverage, the insurer making payment shall, to the extent thereof, be entitled to the proceeds of any settlement for judgment resulting from the exercise of any limits of recovery of that person against any person or organization legally responsible for the bodily injury for which the payment is made, including the proceeds recoverable from the assets of the insolvent insurer.

For the purpose of this section, an 'uninsured motor vehicle' shall be a motor vehicle as to which there is no bodily injury liability insurance and property damage liability insurance in at least the amounts specified in this chapter, or there is that insurance but the insurance company writing the insurance denies coverage thereunder, or has become bankrupt, or there is no bond or deposit of money or securities as provided in this chapter in lieu of the bodily injury and property damage liability insurance, or the owner of the motor vehicle has not qualified as a self-insurer, or a vehicle that is not subject to the provision of this chapter; but the term 'uninsured motor vehicle' shall not include:

a. A motor vehicle owned by the named insured;

b. A motor vehicle that is owned or operated by a self-insurer within the meaning of any motor vehicle financial responsibility law, motor carrier law, or any similar law;

c. A motor vehicle that is owned by the United States of America, Canada, of a state or any agency of any of the foregoing (excluding, however, political subdivisions thereof);

d. A land motor vehicle or trailer, if operated on rails or crawler-treads or while located for use as a residence or premises and not as a vehicle; or

e. A farm-type tractor or equipment designed for use principally off public roads, except while actually upon public roads.

For purposes of this section, 'persons insured' means the named insured and, while resident of the same household, the spouse of any named insured and relatives of either, while in a motor vehicle or otherwise, and any person who uses with the consent, expressed or implied, of the named insured the motor vehicle to which the policy applies and a guest in the motor vehicle to which the policy applies or the personal representative of any of the above or any other person or persons in lawful possession of the motor vehicle.

(4) Shall, in addition to the coverages set forth in subdivisions (2) and (3) of this subsection, provide underinsured motorist coverage, to be used only with a policy that is written at limits that exceed those prescribed by subdivision (2) of this subsection and that afford uninsured motorist coverage as provided by subdivision (3) of this subsection in an amount not to be less than the financial responsibility amounts for bodily injury liability as set forth in this chapter nor greater than one million dollars as selected by the policy owner. An 'uninsured motor vehicle' as described in subdivision (3) of this subsection includes an 'underinsured highway vehicle,' which means a highway vehicle with respect to the ownership, maintenance, or use of which the sum of the limits of liability under all bodily injury liability bonds and insurance policies applicable at the time of the accident is less than the applicable limits of underinsured motorist coverage for the vehicle involved in the accident and insured under the owner's policy. For the purposes of this subdivision, the term 'highway vehicle' means a land motor vehicle or trailer other than

(i) a farm-type tractor or other vehicle designed for use principally off public roads and while not upon public roads;

(ii) a vehicle operated on rails or crawler-treads; or

(iii) a vehicle while located for use as a residence or premises. The provisions of subdivision (3) of this subsection shall apply to the coverage required by this subsection. Underinsured motorist coverage is deemed to apply when, by reason of payment of judgment or settlement, all liability bonds or insurance policies providing coverage for bodily injury caused by the ownership, maintenance, or use of the underinsured highway vehicle have been exhausted. Exhaustion of that liability coverage for the purpose of any single liability claim presented for underinsured motorist coverage is deemed to occur when either (a) the limits of liability per claim have been paid upon the claim, or (b) by reason of multiple claims, the aggregate per occurrence limit of liability has been paid. Underinsured motorist coverage is deemed to apply to the first dollar of an underinsured motorist coverage claim beyond amounts paid to the claimant under the exhausted liability policy.

The limit of underinsured motorist coverage applicable to any claim is determined to be the difference between the amount paid to the claimant under the exhausted liability policy or policies and limit of underinsured motorist coverage applicable to the motor vehicle involved in the accident. Furthermore, if a claimant is an insured under the underinsured motorist coverage on separate or additional policies, the limit of underinsured motorist coverage applicable to the claimant is the difference between the amount paid to the claimant under the exhausted liability policy or policies and the total limits of the claimant's underinsured motorist coverages as determined by combining the highest limit available under each policy; provided, that this sentence shall apply only to insurance on nonfleet private passenger motor vehicles. The underinsured motorist limits applicable to any one motor vehicle under a policy shall not be combined with or added to the limits applicable to any other motor vehicle under that policy.

An underinsured motorist insurer may at its option, upon a claim pursuant to underinsured motorist coverage, pay monies without there having first been an exhaustion of the liability insurance policy covering the ownership, use, and maintenance of the underinsured highway vehicle. In the event of payment, the underinsured motorist insurer shall be either: (a) entitled to receive by assignment from the claimant any right or (b) subrogated to the claimant's right regarding any claim the claimant has or had against the owner, operator, or maintainer of the underinsured highway vehicle; provided, that the amount of the insurer's right by subrogation or assignment shall not exceed payments made to the claimant by the insurer. No insurer shall exercise any right of subrogation or any right to approve settlement with the original owner, operator, or maintainer of the underinsured highway vehicle under a policy providing coverage against an underinsured motorist where the insurer has been provided with written notice before a settlement between its insured and the underinsured motorist and the insurer fails to advance a payment to the insured in an amount equal to the tentative settlement within thirty days following receipt of that notice. Further, the insurer shall have the right, at its election, to pursue its claim by assignment or subrogation in the name of the claimant, and the insurer shall not be denominated as a party in its own name except upon its own election. Assignment or subrogation as provided in this subdivision shall not, absent contrary agreement, operate to defeat the claimant's right to pursue recovery against the owner, operator, or maintainer of the underinsured highway vehicle for damages beyond those paid by the underinsured motorist insurer. The claimant and the underinsured motorist insurer may join their claims in a single suit without requiring that the insurer be named as a party. Any claimant who intends to pursue recovery against the owner, operator, or maintainer of the underinsured highway vehicle for moneys beyond those paid by the underinsured motorist insurer shall before doing so give notice to the insurer and give the insurer, at its expense, the opportunity to participate in the prosecution of the claim. Upon the entry of judgment in a suit upon any such claim in which the underinsured motorist insurer and claimant are joined, payment upon the judgment, unless otherwise agreed to, shall be applied pro rata to the claimant's claim beyond payment by the insurer of the owner, operator, or maintainer of the underinsured highway vehicle and the claim of the underinsured motorist insurer.

A party injured by the operation of an underinsured highway vehicle who institutes a suit for the recovery of monies for those injuries and in such an amount that, if recovered, would support a claim under underinsured motorist coverage shall give notice of the initiation of the suit to the underinsured motorist insurer as well as to the insurer providing primary liability coverage upon the underinsured highway vehicle. Upon receipt of notice, the underinsured motorist insurer shall have the right to appear in defense of the claim without being named as a party therein, and without being named as a party may participate in the suit as fully as if it were a party. The underinsured motorist insurer may elect, but may not be compelled, to appear in the action in its own name and present therein a claim against other parties; provided, that application is made to and approved by a circuit court judge, in any such suit, any insurer providing primary liability insurance on the underinsured highway vehicle may upon payment of all of its applicable limits of liability be released from further liability or obligation to participate in the defense of such proceeding. However, before approving any such application, the court shall be persuaded that the owner, operator, or maintainer of the underinsured highway vehicle against whom a claim has been made has been apprised of the nature of the proceeding and given his right to select counsel of his own choice to appear in the action on his separate behalf. If an underinsured motorist insurer, following the approval of the application, pays in settlement or partial or total satisfaction of judgment monies to the claimant, the insurer shall be subrogated to or entitled to an assignment of the claimant's rights against the owner, operator, or maintainer of the underinsured highway vehicle; and provided, that adequate notice of right of independent representation was given to the owner, operator, or maintainer, a finding of liability or the award of damages shall be res judicata between the underinsured motorist insurer and the owner, operator, or maintainer of the underinsured highway vehicle.

The coverage required under this subdivision shall not be applicable where any insured named in the policy rejects the coverage. An insured named in the policy may select different coverage limits as provided in this subdivision. If the named insured does not reject underinsured motorist coverage and does not select different coverage limits, the amount of underinsured motorist coverage shall be equal to the highest limit of bodily injury liability coverage for any one vehicle in the policy. Once the option to reject underinsured motorist coverage or to select different coverage limits is offered by the insurer, the insurer is not required to offer the option in any renewal, reinstatement, substitute, amended, altered, modified, transfer, or replacement policy unless a named insured makes a written request to exercise a different option. The selection or rejection of underinsured motorist coverage by a named insured or the failure to select or reject is valid and binding on all insureds and vehicles under the policy.

Rejection of or selection of different coverage limits for underinsured motorist coverage for policies under the jurisdiction of the State Rating and Statistical Division shall be made in writing by the named insured on a form promulgated by the division and approved by the Commissioner of Insurance.

(c) Such operator's policy of liability insurance shall insure the person named as insured therein against loss from the liability imposed upon him by law for damages arising out of the use by him of any motor vehicle not owned by him, and within thirty days following the date of its delivery to him of any motor vehicle owned by him, within the same territorial limits and subject to the same limits of liability as are set forth above with respect to an owner's policy of liability insurance.

(d) Such motor vehicle liability policy shall state the name and address of the named insured, the coverage afforded by the policy, the premium charged therefor, the policy period, and the limits of liability, and shall contain an agreement, or be endorsed, that insurance is provided thereunder in accordance with the coverage defined in this chapter as respects bodily injury and death or property damage, or both, and is subject to all the provisions of this chapter.

(e) Such motor vehicle liability policy need not insure against loss from any liability for which benefits are in whole or in part either payable or required to be provided under any workers' compensation law nor any liability for damage to property owned by, rented to, in charge of, or transported by the insured.

(f) Every motor vehicle liability policy shall be subject to the following provisions which need not be contained therein:

(1) Except as hereinafter provided, the liability of the insurance carrier with respect to the insurance required by this chapter shall become absolute whenever injury or damage covered by said motor vehicle liability policy occurs; said policy may not be canceled or annulled as to such liability by any agreement between the insurance carrier and the insured after the occurrence of the injury or damage; no statement made by the insured or on his behalf and no violation of said policy shall defeat or void said policy. As to policies issued to insureds in this State under the assigned risk plan or through the South Carolina Reinsurance Facility, a default judgment taken against such an insured shall not be used as a basis for obtaining judgment against the insurer unless counsel for the plaintiff has forwarded to the insurer, or to one of its agents, by registered or certified mail with return receipt requested, or served by any other method of service provided by law, a copy of the summons, complaint, or other pleadings filed in the action. The return receipt shall, upon its return to plaintiff's counsel, be filed with the clerk of court wherein the action is pending against the insured and shall be admissible in evidence as proof of notice to the insurer. The refusal of the insurer or its agent to accept delivery of the registered mail, as provided in this section, shall not affect the validity of such notice and any insurer or agent of an insurer refusing to accept such registered mail shall be charged with the knowledge of the contents of such notice. When notice has been sent to an agent of the insurer, such notice shall be notice to the insurer. The word 'agent' as used in this subsection shall include, but shall not be limited to, any person designated by the insurer as its agent for the service of process, any person duly licensed by the insurer in the State as insurance agent, any general agent of the company in the State of South Carolina, and any employee of the company in a managerial or other responsible position, or the South Carolina Commissioner of Insurance; provided, where the return receipt is signed by an employee of the insurer or an employee of an agent for the insurer, shall be deemed for the purposes of this subsection to have been received. The term 'agent' as used in this subsection shall not include a producer of record or broker who forwards an application for insurance to the South Carolina Reinsurance Facility.

The insurer, upon receipt of the summons, complaint, or other process, shall be entitled, upon its motion, to intervene in the suit against its insured as a party defendant and to defend the same in the name of its insured. In the event of such intervention by an insurer it shall become a named party defendant. The insurer shall have thirty days from the signing of the return receipt acknowledging receipt of the summons, complaint, or other pleading in which to file a motion to intervene, along with any responsive pleading, whether verified or not, which it may deem necessary to protect its interest; provided, the court having jurisdiction over the matter may, upon motion duly made, extend the time for the filing of the responsive pleading or continue the trial in the matter for the purpose of affording the insurer a reasonable time in which to file a responsive pleading or defend the action. If, after receiving a copy of the summons, complaint or other pleading, the insurer elects not to defend the action, if coverage is in fact provided by the policy, the insurer shall be bound to the extent of its policy limits to the judgment taken by default against the insured, and noncooperation of the insured shall not be a defense.

If the plaintiff initiating an action against the insured has complied with the provisions of this subsection, then, in such event, the insurer may not cancel or annul the policy as to such liability and the defense of noncooperation shall not be available to the insurer; provided, however, nothing in this section shall be construed as depriving an insurer of its defenses that the policy was not in force at the time in question, that the operator was not an 'insured' under policy provisions, or that the policy had been lawfully canceled at the time of the accident giving rise to the cause of action.

The provisions of this subdivision shall not apply when the insured has delivered a copy of the summons, complaint, or other pleadings served on him to his insurance carrier within the time provided by law for filing answer, demurrer, or the pleadings.

(2) The satisfaction by the insured of a judgment for such injury or damage shall not be a condition precedent to the right or duty of the insurance carrier to make payment on account of such injury or damage.

(3) The insurance carrier shall have the right to settle any claim covered by the policy, and if such settlement is made in good faith, the amount thereof shall be deductible from the limits of liability specified in subdivision (2) of subsection (b) of this section.

(4) The policy, the written application therefor, if any, and any rider or endorsement which does not conflict with the provisions of this chapter shall constitute the entire contract between the parties.

(g) Any policy which grants the coverage required for a motor vehicle liability policy may also grant any lawful coverage in excess of or in addition to the coverage specified for a motor vehicle liability policy and such excess or additional coverage shall not be subject to the provisions of this chapter. With respect to a policy which grants such excess or additional coverage the term 'motor vehicle liability policy' shall apply only to that part of the coverage which is required by this section.

(h) Any motor vehicle liability policy may provide that the insured shall reimburse the insurance carrier for any payment the insurance carrier would not have been obligated to make under the terms of the policy except for the provisions of this chapter.

(i) Any motor vehicle liability policy may provide for the prorating of the insurance thereunder with other valid and collectible insurance.

(j) The requirements for a motor vehicle liability policy may be fulfilled by the policies of one or more insurance carriers which policies together meet such requirements.

(k) Any binder issued pending the issuance of a motor vehicle liability policy shall be deemed to fulfill the requirements for such

policy.

Section 38-95-220. When an insurance carrier has certified a motor vehicle liability policy, the insurance so certified shall not be canceled or terminated until at least twenty days after a notice of cancellation of termination of the insurance so certified is filed in the office of the commissioner, except that such a policy subsequently procured and certified shall, on the effective date of its certification, terminate the insurance previously certified with respect to any motor vehicle designated in both certificates.

Section 38-95-230. (a) This chapter shall not be held to apply to or affect policies of automobile insurance against liability which may now or hereafter be required by any other law of this State, and such policies, if they contain an agreement or are endorsed to conform to the requirements of this chapter, may be certified as proof of financial responsibility under this chapter.

(b) This chapter shall not be held to apply to or affect policies insuring solely the insured named in the policy against liability resulting from the maintenance or use by a person in the insured's employ, or on his behalf, of motor vehicles not owned by the insured.

Section 38-95-240. (a) Proof of financial responsibility may be furnished by filing with the commissioner the bond of a surety company duly authorized to transact business in the State or a bond with at least two individual sureties each owning real estate within this State and together having equities in such real estate over and above any encumbrances thereon equal in value to at least twice the amount of such bond, which real estate shall be scheduled in the bond which shall be approved by the clerk of the circuit court of the county wherein the real estate is situated. Such bond shall be conditioned for payments in amounts and under the same circumstances as would be required in a motor vehicle liability policy and shall not be cancellable except after twenty days' written notice to the commissioner . A certificate of the county tax supervisor or person performing the duties of the tax supervisor, showing the assessed valuation of each tract or parcel of real estate for tax purposes shall accompany a bond with individual sureties and, upon acceptance and approval by the commissioner, the execution of such bond shall be proved before the clerk of the circuit court of the county or counties wherein the land or any part thereof lies, and such bond shall be recorded in the office of the register of deeds of such county or counties. Such bond shall constitute a lien upon the real estate therein described from and after filing for recordation to the same extent as in the case of ordinary mortgages and shall be regarded as the equivalent of a mortgage or deed of trust. In the event of default in the terms of the bond the commissioner may foreclose the lien thereof by making public sale upon publishing notice thereof as provided by law; provided, that any such sale shall be subject to the provisions for upset or increased bids and resales. The proceeds of such sale shall be applied by the commissioner toward the discharge of liability upon the bond, any excess to be paid over to the surety whose property was sold. The commissioner shall have power to so sell as much of the property of either or both sureties described in the bond as shall be deemed necessary to discharge the liability under the bond and shall not be required to apportion or prorate the liability as between sureties.

The commissioner may require a certificate of title of a duly licensed attorney which shall show all liens and encumbrances with respect to each parcel of real estate described in the bond and, if any parcel of such real estate has buildings or other improvements thereon, the commissioner may, in his discretion, require the filing with him of a policy or policies of fire and other hazard insurance, with loss clauses payable to the commissioner as his interest may appear. All costs and expenses in connection with furnishing such bond and the registration thereof, and the certificate of title, insurance, and other necessary items of expense shall be borne by the principal obligor under the bond, except that the costs of foreclosure may be paid from the proceeds of sale.

(b) If such a judgment rendered against the principal on such bond shall not be satisfied within sixty days after it has become final, the judgment creditor may, for his own use and benefit and at his sole expense, bring an action or actions in the name of the State against the company or person executing such bond, including an action or proceeding to foreclose any lien that may exist upon the real estate of a person who has executed such bond.

Section 38-95-250. (a) Proof of financial responsibility may be evidenced by the certificate of the State Treasurer that the person named therein has deposited with him sixty-five thousand dollars in cash, or securities such as may legally be purchased by savings banks or for trust funds of a market value of sixty-five thousand dollars. The State Treasurer shall not accept any such deposit and issue a certificate therefor and the commissioner shall not accept such certificate unless accompanied by evidence that there are no unsatisfied judgments of any character against the depositor in the county where the depositor resides.

(b) Such deposit shall be held by the State Treasurer to satisfy, in accordance with the provisions of this chapter, any execution on a judgment issued against such person making the deposit for damages, including damages for care and loss of services because of bodily injury to or death of any person, or for damages because of injury to or destruction of property, including the loss of use thereof, resulting from the ownership, maintenance, use, or operation of a motor vehicle after such deposit was made. Money or securities so deposited shall not be subject to attachment, garnishment, or execution unless such attachment, garnishment, or execution shall arise out of a suit for damages as aforesaid.

Section 38-95-260. Whenever any person required to give proof of financial responsibility hereunder is or later becomes an operator in the employ of any owner, or is or later becomes a member of the immediate family or household of the owner, the commissioner shall accept proof given by such owner in lieu of proof by such other person to permit such other person to operate a motor vehicle for which the owner has given proof as herein provided. The commissioner shall designate the restrictions imposed by this section on the face of such person's license.

Section 38-95-270. The commissioner shall consent to the cancellation of any bond or certificate of insurance, or the commissioner shall direct and the State Treasurer shall return any money or securities to the person entitled thereto upon the substitution and acceptance of other adequate proof of financial responsibility pursuant to this chapter.

Section 38-95-280. Whenever any proof of financial responsibility filed under the provisions of this chapter no longer fulfills the purposes for which required, the commissioner shall for the purpose of this chapter, require other proof as required by this chapter, or whenever it appears that proof filed to cover any motor vehicle owned by a person does not cover all motor vehicles registered in the name of such person, the commissioner shall require proof covering all such motor vehicles. The commissioner shall suspend the license or the nonresident's operating privilege pending the filing of such other proof.

Section 38-95-290. The commissioner shall upon request consent to the immediate cancellation of any bond or certificate of insurance, or the commissioner shall direct and the State Treasurer shall return to the person entitled thereto any money or securities deposited pursuant to this chapter as proof of financial responsibility, or the commissioner shall waive the requirement of filing proof, in any of the following events:

(1) At any time after two years from the date such proof was required when, during the two-year period preceding the request, the commissioner has not received a record of a conviction or a forfeiture of bail which would require or permit the suspension or revocation of the license, registration, or nonresident's operating privilege of the person by or for whom such proof was furnished;

(2) In the event of the death of the person on whose behalf such proof was filed or the permanent incapacity of such person to operate a motor vehicle; or

(3) In the event the person who has given proof surrenders his license to the commissioner.

However, the commissioner shall not consent to the cancellation of any bond or the return of any money or securities in the event any action for damages upon a liability covered by such proof is then pending or any judgment upon any such liability is then unsatisfied or in the event the person who has filed such bond or deposited such money or securities has, within one year immediately preceding such request, been involved as an operator or owner in any motor vehicle accident resulting in injury or damage to the person or property of others. An affidavit of the applicant as to the nonexistence of such facts, or that he has been released from all of his liability, or has been finally adjudicated not to be liable, for such injury or damage, shall be sufficient evidence thereof in the absence of evidence to the contrary in the records of the commissioner.

Whenever any person whose proof has been canceled or returned under subdivision (3) of this section applies for a license within a period of two years from the date proof was originally required, any such application shall be refused unless the applicant shall reestablish such proof for the remainder of such two-year period.

Section 38-95-300. Any person whose license shall have been suspended as herein provided, or whose policy of insurance or bond, when required under this chapter, shall have been canceled or terminated, or who shall neglect to furnish other proof upon request of the commissioner shall immediately return his license to the commissioner. If any person shall fail to return to the commissioner the license as provided herein, the commissioner shall direct any peace officer to secure possession thereof and to return the same to the commissioner.

Section 38-95-310. (a) Failure to report an accident as required shall be punished by a fine not in excess of twenty-five dollars, and, in the event of injury or damage to the person or property of another in such accident, the commissioner shall suspend the license of the person failing to make such report, or the nonresident's operating privilege of such person, until such report has been filed and for such further period not to exceed thirty days as the commissioner may fix.

(b) Any person who gives information required in a report or otherwise as provided for by law knowing or having reason to believe that such information is false or who shall forge or without authority sign any evidence of proof of financial responsibility or who files or offers for filing any such evidence of proof knowing or having reason to believe that it is forged or signed without authority shall be fined not more than one thousand dollars or imprisoned for not more than one year, or both.

(c) Any person willfully failing to return a license shall be fined not more than five hundred dollars or imprisoned not to exceed thirty days, or both.

(c1) Any person who makes a false affidavit or knowingly swears or affirms falsely to any matter is guilty of perjury and shall be punished as for that offense.

(d) Any person who shall violate any provision of this chapter for which no penalty is otherwise provided shall be fined not more than five hundred dollars or imprisoned not more than ninety days, or both.

Section 38-95-320. This chapter, except its provisions as to the filing of proof of financial responsibility by a common carrier and its drivers, does not apply to any vehicle operated under a permit or certificate of convenience or necessity issued by the South Carolina Public Service Commission or by the Interstate Commerce Commission, if public liability and property damage insurance for the protection of the public is required to be carried upon it. This chapter does not apply to any motor vehicle owned by the State of South Carolina, nor does it apply to the operator of a vehicle owned by the State of South Carolina who becomes involved in an accident while operating the state-owned vehicle if the commissioner determines that the vehicle at the time of the accident was probably being operated in the course of the operator's employment as an employee or officer of the course of the operator's employment as an employee or officer in the State. This chapter does not apply to any motor vehicle owned by a county or municipality of the State of South Carolina, nor does it apply to the operator of a vehicle owned by a county or municipality of the State of South Carolina who becomes involved in an accident while operating such vehicle in the course of the operator's employment as an employee or officer of the county or municipality. This chapter does not apply to the operator of a vehicle owned by a political subdivision, other than a county or municipality, of the State of South Carolina who becomes involved in an accident while operating such vehicle if the commissioner determines that the vehicle at the time of the accident was probably being operated in the course of the operator's employment as an employee or officer of the subdivision; provided that the commissioner finds that the political subdivision has waived any immunity it has with respect to such accidents and has in force an insurance policy or other method of satisfying claims which may arise out of the accident. This chapter does not apply to any motor vehicle owned by the federal government; nor does it apply to the operator of a motor vehicle owned by the federal government who becomes involved in an accident while operating the government-owned vehicle if the commissioner determines that the vehicle at the time of the accident was probably being operated in the course of the operator's employment as an employee or officer of the federal government.

Section 38-95-330. The provisions of this chapter shall not apply to school bus drivers with respect to accidents or collisions in which they are involved while operating school buses in the course of their employment.

Section 38-95-340. (a) Any person in whose name more than twenty-five motor vehicles are registered may qualify as a self-insurer by obtaining a certificate of self-insurance issued by the commissioner as provided in subsection (b) of this section. For the purpose of this chapter, the State of South Carolina shall be considered a self-insurer.

(b) The commissioner may, in his discretion, upon the application of such a person, issue a certificate of self-insurance when he is satisfied that such person is possessed, and will continue to be possessed, of ability to pay judgments obtained against such person.

(c) Upon not less than five days' notice and a hearing pursuant to such notice, the commissioner may upon reasonable grounds cancel a certificate of self-insurance. Failure to pay any judgment within thirty days after such judgment has become final shall constitute a reasonable ground for the cancellation of a certificate of self-insurance.

Section 38-95-350. The Commissioner of Insurance shall develop a revised assigned risk plan to be denominated 'The South Carolina Automobile Insurance Plan' as follows:

(1) The Commissioner of Insurance, after consultation with representatives of the insurance carriers licensed to write motor vehicle liability insurance in this State, shall consider such reasonable plans and procedures for providing the coverage and coverage limits as specified in subdivision (4) of this section as such insurance carriers may submit to him for the equitable apportionment among such insurance carriers of those applicants for motor vehicle liability insurance on motor vehicles registered or principally garaged in this State who are unable to secure such insurance through ordinary means. Such plans and procedures shall further provide for a reasonable method of allowing each insurance carrier a credit due to writing coverage limits in excess of those required to meet the minimum requirements for a motor vehicle liability policy as defined by this chapter.

(2) Upon approval by the Commissioner of Insurance of any such plans and procedures thus submitted, all insurance carriers licensed to write motor vehicle liability insurance in this State, as a prerequisite to further engaging in writing such insurance in this State, shall formally subscribe to, and participate in, such plans and procedures so submitted.

(3) In the event the Commissioner of Insurance, in the exercise of his discretion, does not approve any plan so submitted, or should no such plan be submitted, then the Commissioner of Insurance shall formulate and put into effect reasonable plans and procedures providing coverage and coverage limits as specified in subdivision (4) of this section for the apportionment among such insurance carriers of all such applications for motor vehicle liability insurance on motor vehicles registered or principally garaged in this State submitted to him in accordance with the provisions of this section by persons desiring coverage pursuant to the provisions of this section. Such plans and procedures shall further provide for a reasonable method of allowing each insurance carrier a credit due to writing coverage limits in excess of those required to meet the minimum requirements for a motor vehicle liability policy as defined by this chapter.

(4) Should no such plan be submitted by the insurance carriers and approved by the Commissioner of Insurance, then, as a prerequisite to further engaging in the selling of motor vehicle liability insurance in this State, every insurance carrier licensed to write motor vehicle liability insurance in this State shall formally subscribe to and participate in the plans and procedures formulated by the Commissioner of Insurance as provided by subdivision (3) of this section, and every such insurance carrier shall accept any and all risks on motor vehicles registered or principally garaged in this State assigned to it by the Commissioner of Insurance under such plan and shall upon payment of the proper premium issue a policy covering the same, such policy to meet the minimum requirements for a motor vehicle liability policy as defined by this chapter, and, at the option of the applicant, coverage and coverage limits may be obtained through the assigned risk plan of up to but not more than twenty-five thousand dollars because of bodily injury to or death of one person in any one accident, and subject to said limit for one person, to limits of up to but not more than fifty thousand dollars because of bodily injury to or death of two or more persons in any one accident and up to but not more than a limit of ten thousand dollars, without any deductible therefrom, because of injury to or destruction of property of others in any one accident. In addition, at the option of the applicant, at a coverage limit not to exceed five hundred dollars insurance coverage for the payment of medical expenses shall be available under the plan to the same extent and manner and subject to the same conditions and exclusions as such insurance coverage is being currently written voluntarily outside the plan as a part of insurance policies affording the coverages required by this chapter.

In addition, at the option of the applicant, unisured motorist coverage as defined in this chapter shall be available under the plan.

(5) Any such assigned risk plan adopted or approved by the commissioner shall provide that every person who has been unable to obtain a motor vehicle liability insurance policy through ordinary methods or every person who desires to obtain coverage under the provisions of this section on motor vehicles registered or principally garaged in this State shall have the right to apply to the Commissioner of Insurance, or the person designated under the plan, to have his risk assigned to an insurance carrier licensed to write, and writing, motor vehicle liability insurance in this State, and the insurance carrier shall issue a motor vehicle liability policy which meets the minimum requirements for a motor vehicle liability policy and at the option of the applicant provides additional coverage and coverage limits as specified in this section. In such instance where application is made to the Commissioner of Insurance of the person designated under the plan to have a risk assigned to an insurance carrier it shall be deemed that the applicant desires coverage under this section and the Commissioner of Insurance or the person designated under the plan shall upon receipt of such application immediately assign the risk to an insurance carrier, which carrier shall be required, as a prerequisite to further engaging in selling motor vehicle liability insurance in this State, to issue a motor vehicle liability policy which meets at least the minimum requirements for a motor vehicle liability policy and, at the option of the applicant, provides additional coverage and coverage limits as specified in this section.

Any such assigned risk plan adopted or approved by the commissioner shall establish reasonable plans and procedures for decreasing the number of persons obtaining insurance through the South Carolina Automobile Insurance Plan by an equitable method of allowing credit as business written through the plan for business composed of person insured through the plan, which such carriers shall write voluntarily outside the plan.

(6) The Commissioner of Insurance shall establish, or cause to be established, such rate classifications, rating schedules, rates, and regulations to be used by insurance carriers issuing assigned risk motor vehicle liability policies in accordance with this chapter as appear to him to be proper; provided, the Commissioner of Insurance is authorized but not required to establish rates for assigned risk liability policies which are higher than approved manual rates; and in the case of assigned risk policies issued in excess of the minimum limits the Commissioner may establish higher rates or a surcharge adequate to cover the costs of underwriting such excess limits.

In the establishment of rate classifications, rating schedules, rates, and regulations, the Commissioner of Insurance shall be guided by such principles and practices as have been established under his statutory authority to regulate motor vehicle liability insurance rates, and he may act in conformity with his statutory discretionary authority in such matters and may in his discretion assign to the State Rating and Statistical Division any of the administrative duties imposed upon him by this chapter.

(7) The Commissioner of Insurance or the person designated in the plan adopted or approved by the commissioner is empowered, after reviewing all information pertaining to the applicant or policy holder available from the records of the Division of Motor Vehicles and after determining that the applicant's license to operate a motor vehicle has been suspended and continues to be suspended or has been revoked and the revocation remains in effect:

a. To refuse to assign an application;

b. To approve the rejection of an application by an insurance carrier;

c. To approve the cancellation of any motor vehicle liability insurance policy written through the plan by an insurance carrier; or

d. to refuse to approve the renewal or the reassignment of an expiring policy.

Otherwise, nonrenewal or cancellation of insurance under the provisions of this section shall be exercised only in the event of nonpayment of premiums.

(8) The Commissioner of Insurance shall not be held liable for any act or omission in connection with the administration of the duties imposed upon him by the provisions of this chapter, except upon proof of actual malfeasance.

(9) The provisions of this section relevant to assignment of risks shall be available to nonresidents who desire to obtain motor vehicle liability insurance with respect only to motor vehicles registered and principally garaged in this State.

(10) The provisions of this section shall apply to vehicles operated by a county or municipality as an ambulance service or as a rescue squad, and the assigned risk plan shall provide for the assignment of policies on such vehicles.

Section 38-95-360. This chapter shall in no respect be considered as a repeal of any of the motor vehicle laws of this State but shall be construed as supplemental thereto.

Section 38-95-370. Nothing in this chapter shall be construed as preventing the plaintiff in any action at law from relying for relief upon the other processes provided by law.

Section 38-95-380. (a) Every person, firm, or corporation engaging in the business of operating a taxicab or taxicabs within a municipality shall file annually with the governing board of the municipality in which such business is operated proof of financial responsibility as hereinafter defined.

No governing board of a municipality shall issue any certificate of convenience and necessity, franchise, license, permit, or other privilege or authority to any person, firm, or corporation authorizing such person, firm, or corporation to engage in the business of operating a taxicab or taxicabs within the municipality unless such person, firm, or corporation first files with said governing board proof of financial responsibility as hereinafter defined.

Within thirty days after the ratification of this section, every person, firm, or corporation engaging in the business of operating a taxicab or taxicabs outside the corporate limits of a municipality or municipalities shall file with the governing body of the county in which such business is operated proof of financial responsibility as hereinafter defined.

(b) As used in this section, 'proof of financial responsibility' shall mean a certificate of any insurance carrier duly authorized to do business in the State of South Carolina certifying that there is in effect a policy of liability insurance insuring the owner and operator of the taxicab business, his agents, and employees while in the performance of their duties against loss from any liability imposed by law for damages, including damages for care and loss of services because of bodily injury to or death of any person and injury to or destruction of property caused by accident and arising out of the ownership, use, or operation of such taxicab or taxicabs, subject to limits (exclusive of interest and costs) with respect to each such motor vehicle as follows: twenty-five thousand dollars because of bodily injury to or death of one person in any one accident and, subject to said limit for one person, fifty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and fifteen thousand dollars because of injury to or destruction of property of others in any one accident.

(c) Every person, firm, or corporation who engages in the taxicab business and who is a member of or participates in any trust fund or sinking fund, which said trust fund or sinking fund is for the sole purpose of paying claims, damages, or judgments against persons, firms, or corporations engaging in the taxicab business and which city or municipality has a population of over fifty thousand, shall be deemed in compliance with the financial responsibility provisions of this section.

However, in the case of operators of fifteen or more taxicabs, the limits (exclusive of interest and costs) with respect to each such motor vehicle shall be as follows: twenty thousand dollars because of bodily injury to or death of one person in any one accident and subject to said limit for one person, forty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and fifteen thousand dollars because of injury to or destruction of property of others in any one accident.

Section 38-95-390. It is unlawful for any person, firm, or corporation to engage in the business of renting or leasing motor vehicles to the public for operation by the rentee or lessee unless such person, firm, or corporation has secured insurance for his own liability and that of his rentee or lessee, in such an amount as is hereinafter provided, from an insurance company duly licensed to sell motor vehicle liability insurance in this State. Each such motor vehicle leased or rented must be covered by a policy of liability insurance insuring the owner and rentee or lessee and their agents and employees while in the performance of their duties against loss from any liability imposed by law for damages, including damages for care and loss of services because of bodily injury to or death of any person and injury to or destruction of property caused by accident arising out of the operation of such motor vehicle, subject to the following minimum limits: twenty-five thousand dollars because of bodily injury to or death of one person in any one accident, and fifty thousand dollars because of bodily injury to or death of two or more persons in any one accident, and fifteen thousand dollars because of injury to or destruction of property of others in any one accident. Nothing in this chapter shall prevent such operators from qualifying as self-insurers under terms and conditions to be prepared and prescribed by the Commissioner of Insurance or by giving bond with personal or corporate surety in lieu of securing the insurance policy hereinbefore provided for.

Section 38-95-400. No license plate shall be issued by the Division of Motor Vehicles to operate a motor vehicle, for lease or rent for operation by the rentee or lessee, until the applicant for such license plate demonstrates to the Division of Motor Vehicles that he has complied with the provisions of this chapter applicable to such applicant."

SECTION 2. Title 38 of the 1976 Code is amended by adding:

Section 38-97-10. As used in the chapter:

(1) 'Cede' or 'cession' means the act of transferring the risk of loss from the individual insurer to all insurers through the operation of the facility.

(2) [Reserved.]

(3) 'Company' means each member of the facility.

(4) 'Eligible risk' means a person who is a resident of this State who owns a motor vehicle registered or principally garaged in this State or who has a valid driver's license in this State or who is required to file proof of financial responsibility pursuant to Chapter 95 in order to register his motor vehicle or obtain a driver's license in this State, or a nonresident of this State who owns a motor vehicle registered or principally garaged in this State, or the State and its agencies and cities, counties, towns, and municipal corporations in this State and their agencies; provided, however, that no person shall be deemed an eligible risk if timely payment of premium is not tendered or if there is a valid unsatisfied judgment of record against such person for recovery amounts due for motor vehicle insurance premiums and such person has not been discharged from paying said judgment, or if such person does not furnish the information necessary to effect insurance.

(5) 'Facility' means the South Carolina Reinsurance Facility established pursuant to the provisions of this chapter.

(6) 'Motor vehicle' means every self-propelled vehicle that is designed for use upon a highway, including trailer and semitrailers designed for use with such vehicles (except traction engines, road rollers, farm tractors, tractor cranes, power shovels, and well drillers).

(7) 'Motor vehicle insurance' means direct insurance against liability arising out of the ownership, operation, maintenance or use of a motor vehicle for bodily injury, including death and property damage, and includes medical payments and uninsured motorist coverages.

With respect to motor carriers who are subject to the financial responsibility requirements, the term 'motor vehicle insurance' includes coverage with respect to environmental restoration. As used in this subsection, the term, 'environmental restoration' means restitution for the loss, damage, or destruction of natural resources arising out of the accidental discharge, dispersal, release, or escape into or upon the land, atmosphere, water course, or body of water of any commodity transported by a motor carrier. Environmental restoration includes the cost of removal and the cost of necessary measures taken to minimize or mitigate damage to human health, the natural environment, fish, shellfish, and wildlife.

(8) 'Person' means every natural person, firm, partnership, association, corporation, or government or agency thereof.

(9) 'Plan of operation' means the plan of operation approved pursuant to the provisions of the chapter.

Section 38-97-20. There is created a nonprofit unincorporated legal entity to be known as the South Carolina Reinsurance Facility consisting of all insurers licensed to write and engaged in writing within this State motor vehicle insurance or any component thereof. Every such insurer, as a prerequisite to further engaging in writing such insurance in this State, shall be a member of the facility and shall be bound by the rules of operation thereof as provided for in this chapter and as promulgated by the Board of Governors. No company may withdraw from membership in the facility unless it ceases to write motor vehicle insurance in this State or ceases to be licensed to write such insurance.

Section 38-97-30. Any company whose membership in the facility has been terminated by withdrawal shall, nevertheless, with respect to its business prior to midnight of the effective date of such termination continue to be governed by this chapter.

Section 38-97-40. Any unsatisfied net liability to the facility of any insolvent member shall be assumed by and apportioned among the remaining members in the facility in the same manner in which assessments are apportioned by the facility. The facility shall have all rights allowed by law in behalf of the remaining members against the estate or funds of such insolvent for sums due the facility in accordance with this chapter.

Section 38-97-50. When a member has been merged or consolidated into another insurer, or has reinsured its entire motor vehicle liability insurance business in the State with another insurer, such company or its successor in interest shall remain liable for all obligations hereunder and such company and its successor in interest and the other insurers with which it has been merged or consolidated shall continue to participate in the facility according to the rules of operation.

Section 38-97-60. (a) Except as otherwise provided in this chapter, all insurers as a prerequisite to the further engaging in this State in the writing of motor vehicle insurance or any component thereof shall accept and insure any otherwise unacceptable applicant therefor who is an eligible risk if cession of the particular coverage and coverage limits applied for are permitted in the facility. All such insurers shall equitably share the results of such otherwise unacceptable business through the facility and shall be bound by the acts of their agents in accordance with the provisions of this chapter. No insurer shall impose upon any of its agents, solely on account of ceded business received from such agents, any quota or matching requirement for any other insurance as a condition for further acceptance of ceded business from such agents.

(b) Each insurer shall provide the same type of service to ceded business that it provides for its voluntary market. Records provided to agents and brokers shall include an indication that the business is ceded. When an insurer cedes a policy or renewal thereof to the facility and the facility premium for the policy is higher than the premium that the insurer would normally charge for such policy if retained by the insurer, the policyholder shall be informed that

( i) his policy is ceded;

(ii) the coverages are written at the facility rate, which rate differential must be specified;

(iii) the reason or reasons for the cession to the facility;

(iv) the specific reason or reasons for the cession to the facility must be provided upon the written request of the policyholder to the insurer; and

(v) the policyholder may seek insurance through other insurers who may elect not to cede his policy. If such policyholder obtains motor vehicle liability insurance through another insurer who elects not to cede his policy to the facility and the policyholder cancels his ceded policy within forty-five days of the effective date of such ceded policy, the earned premium for such ceded policy shall be calculated on the pro rata basis, except that the pro rata calculation shall not apply to a cancellation by any insurance premium finance company.

(c) Upon the written request of any eligible risk who has been notified pursuant to subsection (b) of this section that his motor vehicle insurance policy has been ceded to the facility, the insurer ceding the insurance policy must provide in writing to that eligible risk the specific reason or reasons for the decision to cede that policy to the facility. Proof of mailing of the written reason or reasons is sufficient proof of compliance with this obligation. With regard to any notice of cession or any written or oral communications specifying the reason or reasons for cession, there shall be no liability on the part of, and no cause of action of any nature shall arise against,

( i) any insurer or its authorized representatives, agents, or employees, or

(ii) any licensed agent, broker, or persons who furnish to the insurer information as to the reason or reasons for the cession, for any communications or statements made by them, unless the communications or statements are shown to have been made in bad faith with malice in fact.

Section 38-97-70. (a) Except as otherwise provided in this chapter, no licensed agent of an insurer authorized to solicit and accept premiums for motor vehicle insurance or any component thereof by the company he represents shall refuse on behalf of said company to accept any application from an eligible risk for such insurance and to immediately bind the coverage applied for and for a period of not less than six months if cession of the particular coverage and coverage limits applied for are permitted in the facility; provided, the application is submitted during the agent's normal business hours, at his customary place of business, and in accordance with the agent's customary practices and procedures. The commission paid on the insurance coverages provided in this chapter shall not be less than the commission on insurance coverage written through the South Carolina Insurance Plan. The same commission shall apply uniformly statewide.

(b) It shall be the responsibility of the agent to write the coverage applied for at what he believes to be the appropriate rate level. If coverage is written at the facility rate level and the company elects not to cede, the policy shall be rated at the voluntary rate level. Coverage written at the voluntary rate level which is not acceptable to the company must either be placed with another company or rated at the facility rate level by the agent.

Section 38-97-80. (a) The operation of the facility shall assure the availability of motor vehicle insurance to any eligible risk, and the facility shall accept all placements made in accordance with this chapter, the plan of operation adopted pursuant thereto, and any amendments to either.

(b) The facility shall reinsure for each coverage available therein to the standard percentage of one hundred percent or lesser equitable percentage established in the plan of operation as follows:

(1) For the following coverages of motor vehicle insurance and in at least the following amounts of insurance:

a. Bodily injury liability: twenty-five thousand dollars each person; fifty thousand dollars each accident;

b. Property damage liability: fifteen thousand dollars each person;

c. Medical payments: one thousand dollars each person, except that this coverage shall not be available for motorcycles;

d. Uninsured motorist: twenty-five thousand dollars each person; fifty thousand dollars each accident for bodily injury; fifteen thousand dollars each accident property damage (one hundred dollars deductible);

e. Any other motor vehicle insurance or financial responsibility limits in the amounts required by any federal law or federal agency regulation; by any law of this State; or by any regulation promulgated pursuant to Title 58 by the South Carolina Public Service Commission.

(2) Additional ceding privileges for motor vehicle insurance shall be provided by the Board of Governors if there is a substantial public demand for a coverage or coverage limit of any component of motor vehicle insurance up to the following:

a. Bodily injury liability: one hundred thousand dollars each person;, three hundred thousand dollars each accident;

b. Property damage liability: fifty thousand dollars each accident;

c. Medical payments: two thousand dollars each person;

d. Underinsured motorist: one hundred thousand dollars each person and three hundred thousand dollars each accident for bodily injury liability;

e. Uninsured motorist: one hundred thousand dollars each person and each accident for bodily injury and fifteen thousand dollars for property damage (one hundred dollars deductible).

(3) Whenever the additional ceding privileges are provided for any component of motor vehicle insurance, the same additional ceding privileges shall be available to 'all other' types of risks subject to the rating jurisdiction of the State Rating Statistical Division.

(c) The facility shall require each member to adjust losses for ceded business fairly and efficiently in the same manner as voluntary business losses are adjusted and to effect settlement where settlement is appropriate.

(d) The facility shall be administered by a board of governors. The board of governors shall consist of twelve members having one vote each from the classifications hereinafter enumerated plus the commissioner who shall serve ex officio without vote. Each facility insurance company member serving on the board shall be represented by a senior officer of the company. Not more than one company in a group under the same ownership or management shall be represented on the board at the same time. Five members of the board shall be selected by the member insurers, which members shall be fairly representative of the industry. To insure representative member insurers, one each shall be selected from the following groups: the American Insurance Association (or its successors), the Alliance of American Insurers (or its successors), the National Association of Independent Insurers (or its successors), all other stock insurers not affiliated with the above groups, and all other nonstock insurers not affiliated with the above groups. The commissioner shall appoint two members of the board who shall be facility insurance company members domiciled in this State. The commissioner shall appoint one member of the board who shall be selected from a list of two nominees submitted by the Auto Insurance Agents of South Carolina, Inc. The commissioner shall appoint four members of the board who shall be fire and casualty insurance agents licensed in the State and actively engaged in writing motor vehicle insurance in this State. The commissioner shall select one agent from among a list of two nominees submitted by the Independent Insurance Agents of South Carolina, Inc., and one agent from among a list of two nominees submitted by the Carolinas Association of Professional Insurance Agents. The initial term of office of said board members shall be two years. Following completion of initial terms, successors to the members of the original board of governors shall be selected to serve three years. All members of the board of governors shall serve until their successors are selected and qualify, and the commissioner may fill any vacancy on the board from any of the aforementioned classifications until such vacancies are filled in accordance with the provisions of this chapter. The board of governors of the facility shall also have as nonvoting members two persons who are not employed by or affiliated with any insurance company or the department and who are appointed by the Governor to serve at his pleasure.

(e) The commissioner and member companies shall provide for a board of governors within thirty days after January 1, 2000. If any member seat on the initial board of governors is not filled in accordance with this chapter within such time, then, in that event, the commissioner shall appoint natural persons from any of the classifications specified in subsection (d) of this section to serve the initial term on the board of governors. As soon as possible after its selection, the commissioner shall call for the initial meeting of the board. After the board of governors has been selected it shall then elect from its membership a chairman and shall then meet thereafter as often as the chairman shall require or at the request of three members of the board of governors. The chairman shall retain the right to vote on all issues. Five members of the board of governors shall constitute a quorum. The same member may not serve as chairman for more than two consecutive years.

(f) The board of governors shall have full power and administrative responsibility for the operation of the facility. Such administrative responsibility shall include but not be limited to:

(1) Proper establishment and implementation of the facility.

(2) Employment of a manager who shall be responsible for the continuous operation of the facility and such other employees, officers, and committees as it deems necessary.

(3) Provision for appropriate housing and equipment to assure the efficient operation of the facility.

(4) Promulgation of reasonable regulations for the administration and operation of the facility and delegation to the manager of such authority as it deems necessary to insure the proper administration and operation thereof.

(g) Except as may be delegated specifically to others in the plan of operation or reserved to the members, power and responsibility for the establishment and operation of the facility is vested in the board of governors, which power and responsibility include but are not limited to the following:

(1) To sue and be sued in the name of the facility. No judgment against the facility shall create any direct liability in the individual member companies of the facility.

(2) To receive and record cessions.

(3) To assess members on the basis of participation ratios established in the plan of operation to cover anticipated or incurred costs of operation and administration of the facility at such intervals as are established in the plan of operation.

(4) To contract for goods and services from others to assure the efficient operation of the facility.

(5) To hear and determine complaints of any company, agent, or other interested party concerning the operation of the facility.

(6) Upon the request of any licensed fire and casualty agent meeting any two of the standards set forth below as determined by the commissioner within ten days of the receipt of the application, the facility shall contract with one or more members within twenty days of receipt of the determination to appoint such licensed fire and casualty agent as designated agents in accordance with reasonable rules as are established by the plan of operation. The standards shall be:

a. whether the agent's evidence establishes that he has been conducting his business in a community for a period of at least one year;

b. whether the agent's evidence establishes that he had a gross premium volume during the thirteen months next preceding the date of his application of at least twenty thousand dollars from motor vehicle insurance;

c. whether the agent's evidence establishes that the number of eligible risks served by him during the thirteen months next preceding the date of application was two hundred or more;

d. whether the agent's evidence establishes a growth in eligible risks served and premium volume during his years of service as an agent;

e. whether the agent's evidence establishes that he made available to eligible risks premium financing or any other plan for deferred payment of premiums.

With respect to business produced by designated agents, adequate provision shall be made by the facility to assure that such business is rated using facility rates. All business produced by designated agents may be ceded to the facility, except that designated agents appointed before September 1, 2002 may place liability insurance policies with a voluntary carrier; provided, that all policies written by the voluntary carrier are retained by the voluntary carrier unless ceded to the facility using facility rates. Designated agents must provide the facility with a list of such policies written by the voluntary carrier at least annually, or as requested by the facility, on a form approved by the facility. If no insurer is willing to contract with any such agent on terms acceptable to the board, the facility shall license such agent to write directly on behalf of the facility. However, for this purpose the facility shall not act as an insurer but shall not only as the statutory agent of all the members of the facility, which shall be bound on risks written by the facility's appointed agent. The facility may contract with one or more servicing carriers and shall promulgate fair and reasonable underwriting procedures to require that business produced by facility agents and written through those servicing carriers shall be rated using facility rates. All business produced by facility agents may be ceded to the facility. Any designated agent who is disabled or retiring or the estate of any deceased designated agent may transfer the designation and the book of business to some other licensed fire and casualty agent meeting the requirements of this section and under regulations established by the facility, and a transfer from a designated agent appointed before September 1, 2002 shall entitle the transferee designated agent to place liability insurance policies with a voluntary carrier.

The commissioner shall require, as a condition precedent to the issuance, renewal, or continuation of a resident agent's license to any designated agent to act for the company appointing such designated agent under contract with the facility, that the designated agent file and thereafter maintain in force while so licensed a bond in favor of the State of South Carolina executed by an authorized corporate surety approved by the commissioner, cash, mortgage on real property, or other securities approved by the commissioner, in the amount of ten thousand dollars for the use of aggrieved persons. Such bond, cash, mortgage, or other securities shall be conditioned on the accounting by the designated agent (i) to any person requesting the designated agent to obtain motor vehicle insurance for moneys or premiums collected in connection therewith, and (ii) to the company providing coverage with respect to any such monies or premiums under contract with the facility. Any such bond shall remain in force until the surety is released from liability by the commissioner, or until the bond is cancelled by the surety. Without prejudice to any liability accrued prior to such cancellation, the surety may cancel the bond upon thirty days' advance notice in writing filed with the commissioner.

No agent may be designated under this subdivision to any insurer that does not actively write voluntary market business.

(7) To maintain all loss, expense, and premium data relative to all risks reinsured in the facility, and to require each member to furnish such statistics relative to insurance reinsured by the facility at such times and in such form and detail as may be required.

(8) To establish fair and reasonable procedures for the sharing among members of any loss on facility business which cannot be recouped or allocated, and other costs, charges, expenses, liabilities, income, property, and other assets of the facility and for assessing or distributing to members their appropriate shares. Such shares may be based on the member's premiums for voluntary business for the appropriate category of motor vehicle insurance or by any other fair and reasonable method.

(9) To receive or distribute all sums required by the operation of the facility.

(10) To accept all risks submitted in accordance with this chapter.

(11) To establish procedures for reviewing claims practices of member companies to the end that claims to the account of the facility are handled fairly and efficiently.

(12) To adopt and enforce all regulations and to do anything else where the board is not elsewhere herein specifically empowered which is otherwise necessary to accomplish the purpose of the facility and is not in conflict with the other provisions of this chapter.

(h) Each member company shall authorize the facility to audit that part of the company' business which is written subject to the facility in a manner and time prescribed by the board of governors.

( i) The board of governors shall fix a date for an annual meeting and shall annually meet on that date. Twenty days' notice of such meeting shall be given in writing to all members of the board of governors.

( j) There shall be furnished to each member an annual report of the operation of the facility in such form and detail as may be determined by the board of governors.

( k) Each member shall furnish statistics in connection with insurance subject to the facility as may be required by the facility. Such statistics shall be furnished at such time and in such form and detail as may be required but at least to include premiums charged, expenses, and losses.

( l) The classifications, rules, rates, rating plans, and policy forms used on motor vehicle insurance policies reinsured by the facility may be made by the facility or by any licensed or statutory rating organization or bureau on its behalf and shall be filed with the commissioner. The board of governors shall establish a separate subclassification within the facility for 'clean risks' as herein defined. For the purpose of this chapter, a 'clean risk' shall be any owner of a nonfleet private passenger motor vehicle, if the owner, principal operator, and each licensed operator in the owner's household have two years' driving experience as licensed drivers and if none of the persons has been assigned any safe driver incentive plan points during the three-year period immediately preceding either (i) the date of application for a motor vehicle insurance policy or (ii) the date of preparation of a renewal of a motor vehicle insurance policy. Such filings may incorporate by reference any other material on file with the commissioner. Rates shall be neither excessive, inadequate, nor unfairly discriminatory. If the commissioner finds, after a hearing, that a rate is either excessive, inadequate, or unfairly discriminatory, he shall issue an order specifying in what respect it is deficient and stating when, within a reasonable period thereafter, such rate shall be deemed no longer effective. Said order is subject to judicial review. Pending judicial review of said order, the filed classification plan and the filed rates may be used, charged, and collected. Said order shall not affect any contract or policy made or issued prior to the expiration of the period set forth in the order. All rates shall be on an actuarially sound basis and shall be calculated, insofar as is possible, to produce neither a profit nor loss. However, the rates made by or on behalf of the facility with respect to 'clean risks', as defined above, shall not exceed the rates charged 'clean risks' who are not reinsured in the facility. The difference between the actual rate charged and the actuarially sound and self-supporting rates for 'clean risks' reinsured in the facility may be recouped in similar manner as assessments or allocated. Rates shall not include any factor for underwriting profit on facility business but shall provide an allowance for contingencies. There shall be strong presumption that the rates and premiums for the business of the facility are neither unreasonable nor excessive.

(m) In addition to annual premiums, the rules of the facility shall allow semiannual and quarterly premium terms.

Section 38-97-90. (a) Within sixty days after the initial organizational meeting, the facility shall submit to the commissioner for his approval a proposed plan of operation consistent with the provisions of this chapter which shall provide for economical, fair, and nondiscriminating administration and for the prompt and efficient provision of motor vehicle insurance to eligible risks. Should no plan be submitted within the aforesaid sixty-day period, then the Commissioner of Insurance shall formulate and place into effect a plan consistent with the provisions of this chapter.

(b) The plan of operation, unless sooner approved in writing, shall be deemed to meet the requirements of the chapter if it is not disapproved by order of the commissioner within thirty days from the date of filing. Prior to the disapproval of all or any part of the proposed plan of operation, the commissioner shall notify the facility in what respect the plan of operation fails to meet the specific requirements of this chapter. The facility shall, within thirty days thereafter, submit for his approval a revised plan of operation which meets the specific requirements of this chapter. In the event the facility fails to submit a revised plan of operation which meets the specific requirements of this chapter within the aforesaid thirty-day period, the commissioner shall enter an order accordingly and shall immediately thereafter formulate and place into effect a plan consistent with the provisions of this chapter.

(c) Any revision of the proposed plan of operation or any subsequent amendments to an approved plan of operation shall be subject to approval or disapproval by the commissioner in the manner herein provided in subsection (b) with respect to the initial plan of operation.

(d) Any order of the commissioner with respect to the plan of operation or any revision or amendment thereof shall be subject to court review.

(e) Upon approval by the commissioner of the plan so submitted or the promulgation of a plan deemed approved by the commissioner, all insurance companies licensed to write motor vehicle insurance in this State or any component thereof as a prerequisite to further engaging in writing such insurance shall formally subscribe to and participate in the plan so approved.

The plan of operation shall provide for, among other matters, the establishment of necessary facilities, the management of the facility, the preliminary assessment of all members for initial expenses necessary to commence operations, the assessment of members, if necessary, to defray losses and expenses, the distribution of gains to defray losses incurred since the effective date hereof and then to persons reinsured by the facility, the recoupment of losses sustained by the facility, which losses may be recouped by equitable pro rata assessment of member companies, the standard amount (one hundred percent or any equitable lesser amount) of coverage afforded on eligible risks which a member company may cede to the facility, and the procedure by which reinsurance shall be accepted by the facility; and shall further provide that:

(1) Members of the board of governors shall receive reimbursement from the facility for their actual and necessary expenses incurred on facility business, en route to perform facility business, and while returning from facility business, plus a per diem allowance of twenty-five dollars a day which may be waived.

(2) In order to obtain a transfer of business to the facility effective when the binder or policy or renewal thereof first becomes effective, the company must within thirty days of the binding or policy effective date notify the facility of the identification of the insured, the coverage and limits afforded, classification data, and premium. The facility shall accept risks at other times on receipt of necessary information, but such acceptance shall not be retroactive. The facility shall accept renewal business after the member on underwriting review elects to again cede the business.

(f) The plan of operation shall provide that every member shall, following payment of any pro rata assessment, commence recoupment of that assessment by way of a surcharge on motor vehicle insurance policies issued by the member or through the facility until the assessment has been recouped. Such surcharge shall be a percentage of premium adopted by the board of governors of the facility, and the charges determined on the basis of the surcharge shall be combined with and displayed as a part of the applicable premium charges. If the amount collected during the period of surcharge exceeds assessments paid by the member to the facility, the member shall pay over the excess to the facility on a date specified by the board of governors. If the amount collected during the period of surcharge is less than the assessments paid by the member to the facility, the facility shall pay the difference to the member. Except as hereinafter provided, the amount of recoupment shall not be considered or treated as a rate or premium for any purpose. The board of governors shall adopt and implement a plan for compensation of agents of facility members when recoupment surcharges are imposed; such compensation shall not exceed the compensation or commission rate normally paid to the agent for the issuance or renewal of the automobile liability policy issued through the South Carolina Reinsurance Facility affected by such surcharge; provided, however, that the surcharge provided for in this section shall include an amount necessary to recover the amount of the assessment to member companies and the compensation paid by each member, pursuant to this section, to agents.

(g) The plan of operation shall provide that all investment income from the premium on business reinsured by the facility shall be retained by or paid over to the facility. In determining the cost of operation of the facility, all investment income shall be taken into consideration.

(h) The plan of operation shall provide for audit of the annual statement of the facility by an independent auditor approved by the Legislative Audit Council.

( i) The facility shall file with the commissioner revisions in the facility plan of operation for his approval or modification. Such revisions shall be made for the purpose of revising the classification and rating plans for other than nonfleet private passenger motor vehicle insurance ceded to the facility.

Section 38-97-100. Upon receipt by the company of a risk which it does not elect to retain, the company shall follow such procedures for ceding the risk as are established by the plan of operation.

Section 38-97-110. No member may terminate insurance to the extent that cession of a particular type of coverage and limits is available under the provisions of this chapter, except for the following reasons:

(1) Nonpayment of premium when due to the insurer or producing agent.

(2) The named insured has become a nonresident of this State and would not otherwise be entitled to insurance on submission of a new application under this chapter.

(3) A member company has terminated an agency contract for reasons other than the quality of the agent's insureds or the agent has terminated the contract and such agent represented the company in taking the original application for insurance.

(4) When the insurance contract has been cancelled pursuant to a power of attorney given a company licensed pursuant to the provisions of this chapter.

(5) The named insured, at the time of renewal, fails to meet the requirements contained in the corporate charter, articles of incorporation, or bylaws, or both, of the insurer, when the insurer is a company organized for the sole purpose of providing members of an organization with insurance policies in South Carolina.

Section 38-97-120. The board of governors may exempt a company and its agents from the requirements of this chapter, insofar as new business is concerned. The board may further exempt a company and its agents from the requirements of this chapter regarding the selling and servicing of a particular category of business, if the company is not qualified to service the business.

Section 38-97-130. No physical damage insurer shall refuse to make physical damage coverage available to any applicant for the reason that such applicant has, or may acquire, auto liability insurance through the facility plan as provided herein; further, that no such insurer may levy a surcharge or increased rate for such physical damage coverage on the basis that such applicant has, or may acquire, auto liability insurance through the facility plan as provided herein.

Any insurer or representative thereof who fails to comply with or violates this section shall be subject to suspension or revocation of his certificate or license.

Section 38-97-140. (a) Any applicant for a policy from any carrier, any person insured under such a policy, any member of the facility, and any agent duly licensed to write motor vehicle insurance may request a formal hearing and ruling by the board of governors of the facility on any alleged violation of or failure to comply with the plan of operation or the provisions of this chapter or any alleged improper act or ruling of the facility directly affecting him as to coverage or premium or in the case of a member, directly affecting its assessment, and in the case of an agent, any matter affecting his appointment to a carrier or his account therewith. The request for hearing must be made within fifteen days after the date of the alleged violation or improper act or ruling. The hearing shall be held within fifteen days after the receipt of the request. The hearing may he held by any panel of the board of governors consisting of not less than three members thereof, and the ruling of a majority of the panel shall be deemed to be the formal ruling of the board, unless the full board on its own motion shall modify or rescind the action of the panel.

(b) Any formal ruling by the board of governors may be appealed to the commissioner by filing notice of appeal with the facility and commissioner within thirty days after issuance of the ruling.

(c) The commissioner shall, after a hearing held on not less than thirty days' written notice to the appellant and to the board, (i) issue an order approving the decision of the board or (ii) after setting out the finding and conclusions as to how the action of the board is not in accordance with the plan of operation, the Standard Practice Manual, or other provisions of this chapter, direct the board to reconsider its decision. In the event the commissioner directs the board to reconsider its decision and the board fails to take action in accordance with the plan of operation, the Standard Practice Manual, or other provisions of this chapter, the commissioner may issue an order modifying the action of the board to the extent necessary to comply with the plan of operation, the Standard Practice Manual, or other provisions of this chapter.

No later than twenty days before each hearing, the appellant shall file with the commissioner or his designated hearing officer and shall serve on the appellee a written statement of his case and any evidence he intends to offer at the hearing. No later than five days before such hearing, the appellee shall file with the commissioner or his designated hearing officer and shall serve on the appellant a written statement of his case and any evidence he intends to offer at the hearing. Each such hearing shall be recorded and transcribed. The cost of such recording and transcribing shall be borne equally by the appellant and appellee; provided, that upon any final adjudication the prevailing party shall be reimbursed for his share of such costs by the other party. Each party shall, on a date determined by the commissioner or his designated hearing officer, but not sooner than fifteen days after delivery of the completed transcript to the party, submit to the commissioner or his designated hearing officer and serve on the other party a proposed order. The commissioner or his designated hearing officer shall then issue an order.

(d) Any aggrieved person or organization, any member of the facility, or the facility may request a public hearing and ruling by the commissioner on the provisions of the plan of operation, regulations, or policy forms approved by the commissioner. The request for hearing shall specify the matter or matters to be considered. The hearing shall be held within thirty days after receipt of the request. The commissioner shall give public notice of the hearing and the matter or matters to be considered not less than fifteen days in advance of the hearing date.

(e) In any hearing held pursuant to this section by the board of governors or the commissioner, the board or the commissioner, as the case may be, shall issue a ruling or order within thirty days after the close of the hearing.

(f) All rulings or orders of the commissioner under this section shall be subject to judicial review.

Section 38-97-150. (a) During the period beginning on July 1, 2000, through June 30, 2001, eighty percent of the facility's losses shall be recouped and twenty percent shall be allocated among all policies.

(b) During the period beginning on July 1, 2001, through June 30, 2002, sixty percent of the facility's losses shall be recouped and forty percent shall be allocated among all policies.

(c) During the period beginning on July 1, 2002, through June 30, 2003, fifty percent of the facility's losses shall be recouped and fifty percent shall be allocated among all policies.

(d) During the period beginning on July 1, 2003, through June 30, 2004, forty percent of the facility's losses shall be recouped and sixty percent shall be allocated among all policies.

(e) During the period beginning on July 1, 2004, through June 30, 2005, thirty percent of the facility's losses shall be recouped and seventy percent shall be allocated among all policies.

(e1) During the period beginning on July 1, 2005, through June 30, 2006, twenty percent of the facility's losses shall be recouped and eighty percent shall be allocated among all policies.

(e2) During the period beginning on July 1, 2006, through June 30, 2007, ten percent of the facility's losses shall be recouped and ninety percent shall be allocated among all polices.

(e3) During the period beginning on July 1, 2007, the facility's losses shall be allocated among all policies.

(f) Recoupment and allocation of facility losses under this section shall be made during the periods specified for the purpose of equitably distributing assessments made on member companies as a result of facility losses. The recoupment and allocation of such losses shall not be considered as the collection or imposition of rates or premiums for any purpose.

(g) This section applies only to losses from, recoupment on, and allocation among nonfleet private passenger motor vehicle insurance policies. This section does not in any way affect the procedures for recouping losses from other motor vehicle insurance policies reinsured by the facility.

(h) The surcharge allocated pursuant to this section shall be a percentage of premium adopted by the board of governors of the facility, and the charges determined on the basis of the surcharge shall be combined with and displayed as a part of the applicable premium charges."

SECTION 3. (A) Section 1-30-10(B)(1)(iii) of the 1976 Code, as added by Section 1 of Act 181 of 1993, is amended to read:

"(iii) in the case of the Department of Agriculture and the Department of Education, the State Commissioner of Agriculture and the State Superintendent of Education, respectively, elected to office under the Constitution of this State, and, in the case of the Department of Insurance, the Commissioner of Insurance elected to office under the laws of this State."

(B) Section 38-1-20(16) of the 1976 Code, as last amended by Section 529 of Act 181 of 1993, is further amended to read:

"(16) 'Director' 'Commissioner of Insurance' means the person who is appointed by the Governor upon the advice and consent of the Senate elected by the qualified electors of this State and who is responsible for the operation and management of the Department of Insurance. The director commissioner has the authority to appoint or designate the person or persons who shall serve at the pleasure of the director commissioner to carry out the objectives or duties of the department as provided by law. Furthermore, the director commissioner may bestow upon his designee or deputy director commissioner any duty or function required of him by law to manage and supervise the Insurance Department of Insurance."

(C) Section 38-3-10 of the 1976 Code, as last amended by Section 532 of Act 181 of 1993, is further amended to read:

"Section 38-3-10. There is established a separate and distinct department of this State, known as the Department of Insurance. The department must be managed and operated by a director commissioner appointed by the Governor upon the advice and consent of the Senate elected by the qualified electors of this State. The director commissioner is subject to removal by the Governor as provided in Section 1-3-240(B) from office as may be provided by law for the other officers of the executive department of this State. The director shall be selected with special reference to his training, experience, technical knowledge of the insurance industry, and demonstrated administrative ability. The director commissioner may appoint or designate the person or persons who shall serve at the pleasure of the director commissioner to carry out the objectives or duties of the department as provided by law. Furthermore, the director commissioner may bestow upon his designee or deputy director commissioner any duty or function required of him by law in managing or supervising the Department of Insurance."

(D) Section 38-3-100 of the 1976 Code, as last amended by Section 532 of Act 181 of 1993, is further amended to read:

"Section 38-3-100. The director Commissioner of Insurance or his designee is not subject to the State Employee Grievance Committee or any internal grievance procedure established at the Insurance Department of Insurance. The director commissioner or his designee shall devote all of his working time to the duties of his office. Before taking the oath of office he shall sever all connections, either direct or indirect, except as a policyholder, with any insurance company or agency and shall maintain the severance during his tenure of office. If he becomes a candidate for public office or becomes a member of a political committee during tenure, his office as director or his designee must be immediately vacated."

(E) The 1976 Code is amended by adding:

"Section 38-3-102. The Commissioner of Insurance must be elected by the qualified electors of the State in the general election. He may succeed himself in the office. His term begins at noon on the first Wednesday following the second Tuesday in January next following his election and ends at noon on the first Wednesday following the second Tuesday in January four years later; provided, however, that the first Commissioner of Insurance elected hereunder shall be elected for an initial two-year term in the election year 2000, and his successor shall be elected for a full four-year term in 2002; thereafter, all successors shall be elected for four-year terms of office. He must be at least thirty years of age at the time his term of office commences. He shall not hold any other public office while serving as commissioner. No candidate for or person elected to the office of commissioner shall accept campaign contributions or anything of value, directly or indirectly, from insurance companies regulated by the Department of Insurance, or their subsidiaries, or from insurance agents or any other insurance professionals regulated pursuant to Title 38 including, but not limited to, employees or immediate family members of such insurance agents, other insurance professionals, and officers, directors, and managers of such insurance companies or subsidiaries. Notwithstanding any other provision of law, a vacancy in the office of commissioner must be filled by the Governor for the unexpired portion of the term."

(F) The election of the Commissioner of Insurance provided in Section 38-3-102 of the 1976 Code begins with the 2002 statewide election process, except that, the first Commissioner of Insurance elected under these provisions shall be elected for an initial two-year term of office in 2000, as provided for in Section 38-3-102. The director serving on the effective date of this act shall continue to serve until his successor is elected and qualifies for office as Commissioner of Insurance.

(G)(1) Every reference of any kind whatever to "Director of the Department of Insurance" in Title 38 and in any other provision of law contained in the 1976 Code of Laws shall be deemed to mean "Commissioner of Insurance".

(2) The Code Commissioner is authorized and directed to change in an timely manner all references to "Director of the Department of Insurance" to "Commissioner of Insurance".

SECTION 4. (A) Act 154 of 1997 is repealed.

(B) Articles 13 and 15 of Chapter 73 of title 38, Articles 3 and 5 of Chapter 77 of Title 38, and Chapters 9 and 10 of Title 56 of the 1976 Code are repealed.

SECTION 5. (A) Section 4(A) of this act takes effect upon approval by the Governor.

(B) Except as otherwise specifically provided in this act, this act takes effect January 1, 2000.

This web page was last updated on Wednesday, December 9, 2009 at 9:06 A.M.