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Senate Transportation hears bill to hide minor infractions from insurers, insurers oppose
Summary
Supporters told the Senate Transportation Committee House Bill 12‑50 would stop insurers from receiving minor, low‑point driving violations after a 2023 law changed disclosure. Insurers and the Insurance Department urged a do‑not‑pass, saying withholding records would skew rates and insurance markets.
The Senate Transportation Committee opened a hearing on House Bill 12‑50, which would limit the driving‑record information released to insurance companies by excluding low‑point violations that became reportable under a 2023 change to state law.
Representative Bill Twight, who presented the bill, said constituents contacted him after House Bill 14‑17 (2023) changed what driving‑record information was released to insurers and that minor infractions — tail‑lighting, small speeding tickets and other low‑point citations — began appearing on records and in some cases affected premiums or coverage. “Those little mistakes are costing them some higher insurance premiums or maybe no insurance at all,” Representative Twight said.
The Department of Transportation’s driver and vehicle director, Brad Shafer, described how the state handled reporting before and after Aug. 1, 2023: prior to that date, Shafer said, the motor‑vehicle system was coded not to send items worth two points or less to insurers; since Aug. 1, 2023, the system has been changed to release all entries on a driving record when an insurer requests it. Shafer said the agency can re‑code the system to withhold low‑point items if the Legislature directs it to do so.
The Association of North Dakota Insurers and several company representatives urged a do‑not‑pass recommendation. Rob Hovland, chief executive officer of Center Mutual and chairman of the Association of North Dakota Insurers, said withholding low‑point violations would cause safer drivers to subsidize higher‑risk drivers. “If this bill passes, obviously, the safer drivers will be paying an artificially higher premium. The less safe drivers will pay an artificially low premium,” Hovland said, recounting an example of a driver whose record showed multiple violations in a short span.
John Arnold, Deputy Insurance Commissioner, told the committee the industry is operating in a hard market driven by multiple factors — inflation, higher vehicle and repair costs and supply issues — and said the record change in 2023 exposed insurers to more of the information they use to price risk. Arnold recommended a do‑not‑pass recommendation for 12‑50.
Committee members asked whether Commercial Driver’s License records would be affected; Representative Twight and witnesses noted federal rules control CDL disclosure and that the state does not have authority to exempt CDL records. Several senators asked about data showing a direct correlation between the reporting change and premium increases; Representative Twight said the callers who had that data were not present at the hearing and that he did not have the studies available.
The committee did not take a vote at the hearing. The bill remains under consideration.
Ending: The committee heard largely opposing testimony from the insurance industry and the state Insurance Department, while the bill’s sponsor described constituent concerns about newly reportable low‑point violations. No committee action was taken during the hearing.
