BILL ANALYSIS Ó
SENATE INSURANCE COMMITTEE
Senator Ronald Calderon, Chair
AB 1708 (Gatto) Hearing Date: June 27, 2012
As Amended: June 11, 2012
Fiscal: Yes
Urgency: No
VOTES: Asm. Floor(05/10/12)73-0/Pass
Asm. Appr. (05/02/12)17-0/Pass
Asm. Ins. (04/18/12)13-0/Pass
SUMMARY: Would clarify existing law to allow motorists to
present proof of insurance electronically to a court or law
enforcement agents upon request. The measure would also
authorize auto insurance companies to provide, upon request of a
policyholder, an electronic version of the proof of insurance
card required by law.
DIGEST
Existing law
1. Requires every driver and every owner of a motor vehicle to be
able to establish financial responsibility, and, at all times,
carry in the vehicle evidence of a form of financial
responsibility, which may be obtained by a law enforcement
officer from the electronic
reporting system established by the Department of Motor
Vehicles;
2. Requires, upon the demand of a peace officer, that evidence
of registration and proof of financial responsibility be
provided by a person driving a motor vehicle;
3. Requires a driver who is issued a notice to appear for any
alleged violation of the Vehicle Code or the driver of a
motor vehicle involved in an accident to furnish written
evidence of financial responsibility;
4. Requires an insurer issuing policies of automobile
liability insurance or motor vehicle liability insurance,
upon the request of its insured or the Department of Motor
AB 1708 (Gatto), Page 2
Vehicles, to promptly issue written verification as to the
existence of that coverage;
5. The California Constitution requires the state to reimburse
local agencies and school districts for certain costs
mandated by the state. Statutory provisions establish
procedures for making that reimbursement.
AB 1708 (Gatto), Page 3
This bill
1. Would authorize an insurer issuing policies of automobile
liability insurance or motor vehicle insurance to issue,
upon the request of the insured and to the extent available,
electronic verification as to the existence of the coverage
to a mobile electronic device, as defined, and would allow a
person to provide evidence of financial responsibility, upon
the demand of a peace officer, through the use of a mobile
electronic device;
2. Would require, when a person provides evidence of financial
responsibility, using a mobile electronic device, to a peace
officer or clerk of the court, the peace officer or the
clerk of the court to only view the evidence of financial
responsibility and would prohibit him or her from viewing
any other content on the mobile electronic device;
3. Would also require, whenever a person presents a mobile
electronic device upon the demand of a peace officer, the
person to assume all liability for any damage to the mobile
electronic device;
4. By expanding the duties of local public officials and
expanding the scope of existing crimes, the bill would
impose a state-mandated local program;
5. Would provide that with regard to certain mandates no
reimbursement is required by this act for a specified
reason. With regard to any other mandates, this bill would
provide that, if the Commission on State Mandates determines
that the bill contains costs so mandated by the state,
reimbursement for those costs shall be made pursuant to the
statutory provisions noted above.
COMMENTS
1. Purpose of the bill. Would clarify existing law to allow
motorists to present proof of insurance electronically to a
court clerk or law enforcement agent upon request. The
measure would also authorize auto insurance companies to
provide, upon request of a policyholder, an electronic
version of the proof of insurance card required by law.
According to the author, AB 1708 seeks to bring uniformity
to the process of proving financial responsibility and
guarantee that a motorist may present to law enforcement,
AB 1708 (Gatto), Page 4
and an auto insurance company may provide, an electronic
version of the proof of insurance.
2. Background and Discussion
According to the author, the law is currently silent on
whether or not a motorist may provide an electronic version
of their proof of insurance. This creates uncertainty for
both auto insurance providers and motorists as to what form
their proof of insurance may be presented in. There have
been reports of some officers accepting electronic forms, at
their discretion, due to the vagueness of the code sections
that cover proof of insurance.
Privacy Protection. Some concerns have been expressed about
the personal information stored on a cell phone.
Probabilities what they are, at some point some personal
information will be unintentionally disclosed when providing
a peace officer an electronic device with personal
information. At issue than is what can be done with the
information, especially under the laws of criminal
procedure.
Proposition 8 (1982) added Article 1, Section 28(f)(2), to
the California Constitution ("Victim's Bill of Rights") that
requires that all relevant evidence be admissible in a
criminal proceeding, with some exceptions. Fourth Amendment
jurisprudence has firmly established, under the Plain View
Doctrine, that when a person voluntarily grants access to
otherwise protected area, evidence discovered in the course
of that search is admissible if the evidence is in plain
view; the officer discovers evidence, contraband, or a fruit
or instrumentality of a crime; and the officer has probable
cause to believe (is immediately apparent) that the item is
evidence, contraband, or a fruit or instrumentality of a
crime. (See Arizona v. Hicks 480 U.S. 321 (1987).)
In order to protect personal privacy, AB 1708 provides that
"the peace officer ? shall only view the evidence of
financial responsibility and is prohibited from viewing any
other content on the mobile electronic device." This
clarifies that the individual is only voluntarily granting
AB 1708 (Gatto), Page 5
access to the proof of financial responsibility when turning
over the personal electronic device.
Nonetheless, AB 1708 does not seek to amend Proposition 8
(which would require a two-thirds vote). Evidence
unintentionally accessed during an examination (for
instance, an unexpected text received while the officer is
reviewing the electronic proof of coverage) might still be
admissible under Proposition 8 and the Plain View Doctrine.
Practically speaking, this might mean that any person who
hands their cell phone over to a peace officer voluntarily
risks disclosure of private information accidentally
revealed, even though AB 1708 only narrowly authorizes peace
officers to view evidence of financial responsibility.
Officer Safety. As technology develops, new risks may
emerge. Anecdotes involve small weapons disguised as cell
phones or small electronics may pose some additional danger.
The author has expressed an interest in monitoring this
issue, although no public safety groups oppose the bill and
no proposals have been made to address the issue.
3. Summary of Arguments in Support
a. The author states that this measure would be a
step towards greater convenience for motorists by
government acknowledging and adapting to the more common
use of electronics in everyday life. With the rise of
smartphones and other personal electronic devices, more
and more transactions between persons and business, as
well as between persons and government, are occurring
electronically. As a result, various sorts of
information are being transmitted to, and kept on, these
devices for easier access.
b. The author also points out that in many cases, the
law and government services have not kept up with new
technology. One such instance is with vital documents on
personal electronic devices. With more and more
AB 1708 (Gatto), Page 6
companies connecting with their customers and providing
services via mobile applications, it seems that now is
the time for the State of California to provide the same
convenience to their customers-the People of our State.
c. The Personal Insurance Federation of California
believes that AB 1708 provides a customer-friendly and
"green" option to consumers, in part because it would
eliminate the need for paper copies of the insurance
identification card.
d. The Association of California Insurance Companies
(ACIC) writes that AB 1708 is the wave of the future.
In an effort to keep up, policymakers across the country
are changing the rules to allow drivers tot show proof
of insurance electronically. Indeed, AB 1708's approach
is consistent with laws adopted in other states like
Alabama, Arizona, Colorado, and Idaho.
4. Summary of Arguments in Opposition
None received.
5. Suggested Amendments
a. The Judicial Counsel of California has expressed
concerns that a hardcopy of the verification of evidence
of financial responsibility by filed with the court.
Amend page 5, lines 8 through 32, to read:
(e) A person issued a notice to appear for a violation
of subdivision (a) may personally appear before the clerk
of the court, as designated in the notice to appear, and
provide written evidence of financial responsibility or
provide verification of evidence of financial
responsibility using a mobile electronic device in a form
consistent with Section 16020, showing that the driver was
AB 1708 (Gatto), Page 7
in compliance with that section at the time the notice to
appear for violating subdivision (a) was issued. In lieu
of the personal appearance, the person may submit by mail
to the court written evidence of having had financial
responsibility at the time the notice to appear was
issued. Upon receipt by the clerk of that written evidence
of financial responsibility or verification of evidence of
financial responsibility using a mobile electronic device
in a form consistent with Section 16020, further
proceedings on the notice to appear for the violation of
subdivision (a) shall be dismissed.
(f) For purposes of this section, "mobile electronic
device" means a portable computing and communication
device that has a display screen with touch input or a
miniature keyboard.
(g) For the purposes of this section, when a person
provides evidence of financial responsibility using a
mobile electronic device to a peace officer or clerk of
the court , the peace officer or clerk of the court shall
only view the evidence of financial responsibility and is
prohibited from viewing any other content on the mobile
electronic device.
(h) Whenever a person presents a mobile electronic
device pursuant to this section, that person assumes all
liability for any damage to the mobile electronic device.
6. Prior and Related Legislation in California and Other State
SB 290 (Committee on Transportation) (Chapter 825, statutes
of 2001) provided that proof of financial responsibility
requires the name of the insurance company to be included,
as well as the number of the insurance policy, and may be
obtained by an officer from an electronic reporting system
established by the Department of Motor Vehicles.
Alabama - The Alabama Department of Revenue is promulgating
regulations that, effective January 1, 2013, would allow
motorists to prove they have insurance to both DMV officials
(for purposes of vehicle registration and renewal) and law
enforcement officers.
Arizona - HB 2677 (Dial) was signed into law on March 27,
2012, and provides that a display or an image of a valid
insurance card that is displayed on a wireless communication
device meets the evidentiary requirements of proof of
insurance or financial responsibility.
AB 1708 (Gatto), Page 8
Colorado - Colorado law requires state officials to verify
insurance coverage prior to registering a new vehicle. For
purposes of satisfying this requirement, Colorado Department
of Revenue regulations allow motorists to present proof of
coverage in myriad formats, including computer printout, fax
and electronic image/proof on applicant's cellular phone,
lap top or other portable type of electronic device.
Idaho - SB 1319 was signed into law on March 27, 2012, and
provides that a certain certificate or proof of liability
insurance may be produced in paper or electronic format and
to provide the acceptable electronic formats.
Louisiana - HB 1130 provides for electronic display of proof
of insurance effective August 1, 2012.
Mississippi - The Mississippi Legislature is expected to
consider legislation this year that would adopt a program
designed to verify insurance coverage and allow motorists to
display proof of insurance coverage in either paper or
electronic format.
POSITIONS
Support
Association of California Insurance Companies
Department of Insurance
Personal Insurance Federation of California
Opposition
None received.
Consultant: Hugh Slayden, (916) 651-4773