BILL NUMBER: AB 1871	CHAPTERED
	BILL TEXT

	CHAPTER  454
	FILED WITH SECRETARY OF STATE  SEPTEMBER 29, 2010
	APPROVED BY GOVERNOR  SEPTEMBER 29, 2010
	PASSED THE SENATE  AUGUST 25, 2010
	PASSED THE ASSEMBLY  AUGUST 26, 2010
	AMENDED IN SENATE  AUGUST 20, 2010
	AMENDED IN SENATE  JUNE 10, 2010
	AMENDED IN ASSEMBLY  JUNE 1, 2010
	AMENDED IN ASSEMBLY  MAY 11, 2010
	AMENDED IN ASSEMBLY  APRIL 28, 2010

INTRODUCED BY   Assembly Member Jones

                        FEBRUARY 12, 2010

   An act to add Section 11580.24 to the Insurance Code, relating to
motor vehicle insurance coverage.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1871, Jones. Private passenger motor vehicle insurance
coverage: personal vehicle sharing.
   Existing law prohibits an insured motor vehicle from being
classified as a common carrier, livery, or for-hire vehicle solely
for the reason that the named insured is performing volunteer
services for a nonprofit charitable organization or governmental
agency consisting of providing social service transportation, as
defined.
   This bill would prohibit a private passenger motor vehicle, as
defined, from being classified for insurance purposes as a
commercial, for-hire, or permissive use vehicle, or livery solely on
the basis of it being used for personal vehicle sharing, as defined,
if the annual revenue received by the vehicle's owner that is
generated by personal vehicle sharing does not exceed the annual
expenses of owning and operating the vehicle, including, but not
limited to, depreciation, interest, lease payments, automobile loan
payments, insurance, maintenance, parking, and fuel, and the personal
vehicle sharing is conducted pursuant to a personal vehicle sharing
program.
   The bill would define a personal vehicle sharing program as a
legal entity qualified to do business in the state that facilitates
personal vehicle sharing, as specified. The bill would require a
personal vehicle sharing program, among other things, during all
times that the vehicle is engaged in personal vehicle sharing, to
provide insurance coverage, as specified, and collect, maintain, and
make available to the vehicle owner and the vehicle owner's primary
automobile liability insurer verifiable electronic records
identifying the date, time, initial and final locations of the
vehicle, and miles driven when it is being used as part of the
personal vehicle sharing program.
    The bill would limit the circumstances under which the vehicle
owner's automobile liability insurance can be subject to liability,
and require that automobile insurance policies not be canceled,
voided, terminated, rescinded, or nonrenewed solely on the basis that
the private passenger motor vehicle has been made available for
personal vehicle sharing. The bill would authorize the insurer of the
vehicle to exclude any and all coverage afforded under the vehicle
owner's automobile insurance policy while the vehicle is used by a
person other than the owner as part of a personal vehicle sharing
program, and would provide the primary and excess insurers of owners,
operators, and maintainers of the vehicle with the right to inform
the insured that it has no duty to defend or indemnify any person or
organization for liability for any loss that occurs during use of the
vehicle in a personal vehicle sharing program.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 11580.24 is added to the Insurance Code, to
read:
   11580.24.  (a) No private passenger motor vehicle insured by its
owner pursuant to a policy of insurance subject to Section 11580.1 or
11580.2 shall be classified as a commercial vehicle, for-hire
vehicle, permissive use vehicle, or livery solely because its owner
allows it to be used for personal vehicle sharing as long as all of
the following circumstances apply:
   (1) The personal vehicle sharing is conducted pursuant to a
personal vehicle sharing program.
   (2) The annual revenue received by the vehicle's owner which was
generated by the personal vehicle sharing of the vehicle does not
exceed the annual expenses of owning and operating the vehicle,
including depreciation, interest, lease payments, auto loan payments,
insurance, maintenance, parking, fuel, cleaning, automobile repair,
and costs associated with personal vehicle sharing, including, but
not limited to, the installation, operation, and maintenance of
computer hardware and software, signage identifying the vehicle as a
personal sharing vehicle, and any fees charged by a personal vehicle
sharing program.
   (3) The owner of the private passenger motor vehicle does not
knowingly place the vehicle into commercial use, as defined by
Section 675.5, by a personal vehicle sharing user while engaged in
personal vehicle sharing.
   (b) For purposes of this section the following definitions apply:
   (1) "Personal vehicle sharing" means the use of private passenger
motor vehicles by persons other than the vehicle's owner, in
connection with a personal vehicle sharing program.
   (2) "Personal vehicle sharing program" means a legal entity
qualified to do business in the State of California engaged in the
business of facilitating the sharing of private passenger vehicles
for noncommercial use by individuals within the state.
   (3) "Private passenger motor vehicle" means a vehicle that is
insured, or is subject to being insured, under a personal automobile
liability insurance policy insuring a single individual or
individuals residing in the same household, as the named insured, or
meets the requirements of Section 16058 of the Vehicle Code, but does
not include a vehicle with fewer than four wheels.
   (c) A personal vehicle sharing program shall, for each vehicle
that it facilitates the use of, do all of the following:
   (1) During all times that the vehicle is engaged in personal
vehicle sharing, provide insurance coverages for the vehicle and
operator of the vehicle that are equal to or greater than the
insurance coverages maintained by the vehicle owner and reported to
the personal vehicle sharing program. However, the personal vehicle
sharing program shall not provide liability coverage less than three
times the minimum insurance requirements for private passenger
vehicles. Compliance with the terms and conditions of this paragraph
shall be deemed to avoid the application of the limitation on damage
recoveries set forth in Section 3333.4 of the Civil Code.
   (2) Provide the registered owner of the vehicle with a Department
of Motor Vehicles Form REG 5085 or other suitable proof of compliance
with the insurance requirements of this section and the requirements
of the California Financial Responsibility Law in Section 1656.2 of
the Vehicle Code, a copy of which shall be maintained in the vehicle
by the vehicle's registered owner during any time when the vehicle is
operated by any person other than the vehicle's owner pursuant to a
personal vehicle sharing program.
   (3) Collect, maintain, and make available to the vehicle's owner,
the vehicle owner's primary automobile liability insurer on file with
the Department of Motor Vehicles, and to any other government agency
as required by law, at the cost of the personal vehicle sharing
program, verifiable electronic records that identify the date, time,
initial and final locations of the vehicle, and miles driven when the
vehicle is under the control of a person other than the vehicle's
owner pursuant to a personal vehicle sharing program.
   (4) Provide the vehicle's owner and any person that operates the
vehicle pursuant to a personal vehicle sharing program with a
disclosure that contains information explaining the terms and
conditions contained in this section.
   (5) Not knowingly permit the vehicle to be operated for commercial
use by a personal vehicle sharing user while engaged in personal
vehicle sharing.
   (6) Use only private passenger vehicles.
   (7) Facilitate the installation, operation, and maintenance of
computer hardware and software and signage, necessary for a vehicle
to be used in a personal vehicle sharing program, including payment
of the cost of damage or theft of that equipment and any damage
caused to the vehicle by the installation, operation, and maintenance
of that equipment.
   (d) Notwithstanding any other provision of law or any provision in
a private passenger motor vehicle owner's automobile insurance
policy, in the event of a loss or injury that occurs during any time
period when the vehicle is under the operation and control of a
person, other than the vehicle owner, pursuant to a personal vehicle
sharing program, or otherwise under the control of a personal vehicle
sharing program, the personal vehicle sharing program shall assume
all liability of the owner and shall be considered the owner of the
vehicle for all purposes. Nothing in this section limits the
liability of the personal vehicle sharing program for its acts or
omissions that result in injury to any persons as a result of the use
or operation of a personal vehicle sharing program.
   (e) A personal vehicle sharing program shall continue to be liable
pursuant to subdivision (d) until both of the following occur:
   (1) The private passenger motor vehicle is returned to a location
designated by the personal vehicle sharing program.
   (2) The earliest of one of the following occurs:
   (A) The expiration of the time period established for the
particular use of the vehicle.
   (B) The intent to terminate the personal vehicle sharing use is
verifiably communicated to the personal vehicle sharing program.
   (C) The vehicle's owner takes possession and control of the
vehicle.
   (f) The personal vehicle sharing program shall assume liability
for a claim in which a dispute exists as to who was in control of the
vehicle when the loss occurred giving rise to the claim, and the
vehicle's private passenger motor vehicle insurer shall indemnify the
personal vehicle sharing program to the extent of its obligation
under the applicable insurance policy, if it is determined that the
vehicle's owner was in control of the vehicle at the time of the
loss.
   (g) In the event that the owner of the vehicle is named as a
defendant in a civil action, for a loss or injury that occurs during
any time period when the vehicle is under the operation and control
of a person, other than the vehicle's owner, pursuant to a personal
vehicle sharing program, or otherwise under the control of a personal
vehicle sharing program, the personal vehicle sharing program shall
have the duty to defend and indemnify the vehicle's owner, subject to
the provisions of subdivisions (d) and (f).
   (h) Notwithstanding any other provision of law or any provision in
a vehicle owner's automobile liability insurance policy, while a
private passenger motor vehicle is used by a person other than its
owner pursuant to personal vehicle sharing facilitated through a
personal vehicle sharing program, all of the following shall apply:
   (1) The insurer of that vehicle on file with the Department of
Motor Vehicles may exclude any and all coverage afforded pursuant to
its policy.
   (2) The primary and excess insurer or insurers of the owners,
operators, and maintainers of the private passenger motor vehicle
used in a personal vehicle sharing program shall have the right to
notify an insured that it has no duty to defend or indemnify any
person or organization for liability for any loss that occurs during
use of the vehicle in a personal vehicle sharing program.
   (i) No policy of insurance that is subject to Section 11580.1 or
11580.2 shall be canceled, voided, terminated, rescinded, or
nonrenewed solely on the basis that the private passenger motor
vehicle has been made available for personal vehicle sharing pursuant
to a personal vehicle sharing program that is in compliance with the
provisions of this section.