Subchapter C. SURCHARGE DISCLOSURE PLAN
Sec.
67.31. Purpose
67.32. Definitions.
67.33. Assessment of premium surcharge.
67.34. Contents of the surcharge disclosure plan.
67.35. Distribution of the surcharge disclosure plan.§ 67.31. Purpose.
The purpose of this subchapter is to establish guidelines for the assessment of premium surcharges and the form and content of surcharge disclosure plans under the act.
§ 67.32. Definitions.
The following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise:
Act—75 Pa.C.S. § § 1701—1798 (relating to the Motor Vehicle Financial Responsibility Law).
Department—The Insurance Department of the Commonwealth.
Insured—Named insured and the following persons if residing in the household of the named insured: A spouse of the named insured, a relative of the named insured, and a minor in the custody of the named insured or the spouse or relative of the named insured.
Insurer—An insurance company, association, or exchange providing coverage on motor vehicles under the act.
Named insured—A person or entity identified by name as an insured in a policy.
Policy—An insurance policy which provides coverage to satisfy the financial responsibility requirements of the act.
Prospective insured—A person or entity applying for insurance coverage on a motor vehicle under the act.§ 67.33. Assessment of premium surcharge.
(a) Circumstances where a premium surcharge can be assessed on a named insured.
(1) Insurers may assess a premium surcharge on policies where payment for at-fault accidents exceeds their approved dollar threshold. An at-fault accident is one where the insured was at fault in causing or contributing to the accident, and the claim resulting from that accident was paid in part or in whole by the insurer.
(2) Insurers may assess a premium surcharge on policies where an insured has been convicted of at least two violations of an offense enumerated in 75 Pa.C.S. § 1535 (relating to schedule of convictions and points).
(i) To impose a surcharge the two violations must have occurred in a period of time no more than 36 months in duration.
(ii) To impose a surcharge the accumulation of two violations must have been committed by one individual insured in the household covered by the policy.
(3) Where an insurer imposes a surcharge for an at-fault accident, the amount of the surcharge may be increased if the same accident also resulted in two 75 Pa.C.S. § 1535 convictions.
(4) Offenses that occur while operating a motor vehicle other than those listed in 75 Pa.C.S. § 1535 may be used in a premium surcharge plan.
(b) Circumstances under which a surcharge cannot be assessed.
(1) An insurer may not assess a premium surcharge for the payment of a claim arising from one or more accidents where the insured was not at fault in causing or contributing to the accident.
(2) An insured shall be deemed not at fault for an accident which occurs under the following circumstances:
(i) The motor vehicle is lawfully parked and is struck by another vehicle. If the parked vehicle rolls from the parked position, then the accident is charged to the person who parked the vehicle.
(ii) The insured, or owner of the motor vehicle, is reimbursed by, or on behalf of, a person who is responsible for the accident, or the insurer is able to subrogate its entire payment to the insured.
(iii) The insured, or owner of the motor vehicle, has a judgment against a person who is responsible for the accident.
(iv) The motor vehicle is struck in the rear by another vehicle and the insured has not been convicted of a traffic violation in connection with the accident.
(v) The driver of the other motor vehicle involved in the accident was convicted of a moving traffic violation and the insured was not convicted of a moving traffic violation in connection with the accident.
(vi) The motor vehicle driven by the insured is struck by a hit-and-run vehicle, if the accident is reported to the proper authority within 24 hours by the insured.
(vii) The accident involves damage by contact with animals or fowl.
(viii) The accident involves physical damage, limited to and caused by flying gravel, missiles, or falling objects.
(ix) The accident occurs when the insured is using the motor vehicle in response to an emergency if the insured was a paid or voluntary member of a police or fire department, first-aid squad, or a law enforcement agency at the time of the accident. This exception does not include an accident occurring after the motor vehicle ceases to be used in response to the emergency.
(3) An insurer may not assess a premium surcharge for the payment of a claim made under the comprehensive portion of the policy unless the loss was intentionally caused by the insured.
(4) An insurer may not assess a premium surcharge solely because of one conviction of an offense enumerated in 75 Pa.C.S. § 1535. If an insurer assesses a surcharge because of payment for an at-fault accident, the insurer may not increase the surcharge solely because of one 75 Pa.C.S. § 1535 conviction connected with that same accident.
§ 67.34. Contents of the surcharge disclosure plan.
(a) A surcharge disclosure plan shall describe the circumstances and conditions when a surcharge would be applied, the estimated increase of the surcharge per policy period per policyholder and the number of years a surcharge will be in effect. The estimated increase of the surcharge may be stated as a percent or dollar amount of premium increase. The estimated increase may also be stated as a percentage of the base premium if the insurer describes the manner in which the prospective or named insured’s premium relates to the base premium.
(b) The insurer shall disclose the approved dollar threshold in the surcharge disclosure plan.
(c) The insurer shall disclose in the surcharge disclosure plan whether the insurer will assess a premium surcharge due to the payment of an at-fault accident by another insurer.
§ 67.35. Distribution of the surcharge disclosure plan.
(a) Prospective insured. Beginning on October 1, 1984, the insurer shall give the surcharge disclosure plan to each prospective insured at the time application is made for motor vehicle insurance coverage.
(b) Named insured. Beginning on October 1, 1984, the insurer shall deliver the surcharge disclosure plan to each named insured at least once every year.
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