Purpose

This bill creates a small, ongoing charge on certain auto insurance to fund an automobile theft prevention program. It specifies which kinds of vehicles are subject to the charge and how the money is handled.

Main Provisions

• Surcharge amount and frequency:
  • Insurers must collect a surcharge of 50 cents for each vehicle for every six months of coverage on policies that include comprehensive auto insurance in Minnesota.
  • The surcharge is separate from the policy’s premium and is not counted for premium tax or agents’ commissions.
  • The charged amount must appear separately on billing or the policy declaration sent to the insured.
• How the money is used:
  • Insurers must send the surcharge revenue to the Minnesota Commissioner of Revenue.
  • The funds are for the automobile theft prevention program described in section 65B.84.
• Vehicle types covered (subject to the surcharge):
  • The surcharge applies to policies defined as auto insurance for the following vehicle types: 1) passenger automobile 2) pickup truck 3) van (but not commuter vans) 4) motorcycle 5) fleet 6) recreational vehicle
  • Vehicles with a gross vehicle weight over 10,000 pounds are not included in this surcharge.
• Definitions:
  • The term “policy of automobile insurance” uses the definition in section 65B.14. This applies to the listed vehicle types defined in section 168.002 and related references (e.g., commuter vans in section 168.126).

Significant Changes to Existing Law

• The bill amends Minnesota Statutes to create a new, per-vehicle surcharge on comprehensive auto insurance and directs its use to fund an automobile theft prevention program.
• It narrows the scope of which vehicles are subject to the surcharge by excluding heavy vehicles over 10,000 pounds and clarifies which common light- to medium-weight vehicles are included (passenger cars, pickups, vans, motorcycles, fleets, and recreational vehicles).
• It requires the surcharge to be itemized separately to insureds and directs remittance to the commissioner of revenue for the theft prevention program, aligning revenue collection with program funding.

Relevant Terms - surcharge - 50 cents - six months - comprehensive insurance - policy of automobile insurance - billing or policy declaration - commissioner of revenue - automobile theft prevention program - 65B.84 - 65B.14 - 168.002 - 168.126 - passenger automobile - pickup truck - van (not commuter van) - motorcycle - fleet - recreational vehicle - gross vehicle weight - 10,000 pounds