EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb0355*
HOUSE BILL 355
C4 3lr2812
HB 660/20 – ECM
By: Delegate Bridges
Introduced and read first time: January 26, 2023
Assigned to: Economic Matters
A BILL ENTITLED
AN ACT concerning 1
Baltimore City Lifeline Low–Cost Automobile Insurance Program 2
FOR the purpose of establishing the Baltimore City Lifeline Low–Cost Automobile 3
Insurance Program in the Maryland Automobile Insurance Fund to offer low–cost 4
automobile insurance policies to residents of Baltimore City; requiring the Program, 5
on receipt of a certain premium, to sell, issue, and deliver certain policies of 6
automobile insurance to individuals who meet certain eligibility requirements; 7
requiring the Program to offer certain applicants the option to purchase certain 8
additional coverages; authorizing the Program to offer a certain alternative payment 9
plan and impose a certain administrative processing fee; prohibiting policies from 10
being premium–financed; requiring certain insurers to pay a certain annual fee to 11
support certain Program public awareness efforts; requiring certain committees of 12
the General Assembly to review annually certain expenditures for public awareness; 13
and generally relating to the Baltimore City Lifeline Low–Cost Automobile 14
Insurance Program. 15
BY repealing and reenacting, with amendments, 16
Article – Insurance 17
Section 20–301 18
Annotated Code of Maryland 19
(2017 Replacement Volume and 2022 Supplement) 20
BY adding to 21
Article – Insurance 22
Section 20–6A–01 through 20–6A–10 to be under the new subtitle “Subtitle 6A. 23
Baltimore City Lifeline Low–Cost Automobile Insurance Program” 24
Annotated Code of Maryland 25
(2017 Replacement Volume and 2022 Supplement) 26
SECTION 1. BE IT ENACTED BY THE GENER AL ASSEMBLY OF MARYLAND, 27
That the Laws of Maryland read as follows: 28 2 HOUSE BILL 355
Article – Insurance 1
20–301. 2
(a) The purpose of the Fund is to provide the financial security required under § 3
17–103 of the Transportation Article to: 4
(1) those eligible persons that are unable to obtain it from an Association 5
member; AND 6
(2) ELIGIBLE INDIVIDUALS UNDER THE BALTIMORE CITY LIFELINE 7
LOW–COST AUTOMOBILE INSURANCE PROGRAM ESTABLISHED U NDER SUBTITLE 8
6A OF THIS TITLE. 9
(b) Money of the Fund consists of revenues, premiums, and other receipts 10
provided by law. 11
(c) (1) All operating expenses of the Fund shall be paid from the money 12
collected by or for the Fund. 13
(2) (i) Subject to subparagraphs (ii) through (iv) of this paragraph, 14
money and property available to the Fund may be used for the general purposes of the 15
Fund. 16
(ii) Premiums collected and income accruing from those premiums 17
may be used only for the payment of claims arising under policies issued by the Fund and 18
for the administrative expenses of the Fund. 19
(iii) The Fund shall keep separate records of any income and 20
expenses directly attributable to the Uninsured Division, including the processing and 21
payment of unsatisfied claims under Subtitle 6 of this title. 22
(iv) The Fund shall keep separate records of any income and 23
expenses directly attributable to its commercial policy and claims operations. 24
SUBTITLE 6A. BALTIMORE CITY LIFELINE LOW–COST AUTOMOBILE INSURANCE 25
PROGRAM. 26
20–6A–01. 27
(A) IN THIS SUBTITLE THE FOLLOWING WORDS HAVE THE MEANINGS 28
INDICATED. 29
(B) “POLICY” MEANS A LOW –COST AUTOMOBILE INSU RANCE POLICY 30
ISSUED UNDER THIS SU BTITLE BY THE PROGRAM. 31 HOUSE BILL 355 3
(C) “PROGRAM” MEANS THE BALTIMORE CITY LIFELINE LOW–COST 1
AUTOMOBILE INSURANCE PROGRAM. 2
20–6A–02. 3
(A) THERE IS A BALTIMORE CITY LIFELINE LOW–COST AUTOMOBILE 4
INSURANCE PROGRAM. 5
(B) THE PURPOSE OF THE PROGRAM IS TO OFFER L OW–COST AUTOMOBILE 6
INSURANCE POLICIES T O RESIDENTS OF BALTIMORE CITY IN ACCORDANCE WI TH 7
THIS SUBTITLE. 8
(C) (1) THE PROGRAM IS PART OF TH E FUND. 9
(2) THE PROGRAM SHALL BE ADMINISTERED IN THE SAME MANNER 10
AS THE FUND. 11
(D) THE PROGRAM SHALL BE DEVE LOPED IN CONSULTATIO N WITH THE 12
ADMINISTRATION . 13
20–6A–03. 14
(A) ON RECEIPT OF THE PRE MIUM SET BY THE FUND, THE PROGRAM SHALL 15
SELL, ISSUE, AND DELIVER A POLICY THAT PROVIDES THE SE CURITY REQUIRED 16
UNDER § 17–103 OF THE TRANSPORTATION ARTICLE TO AN INDIVID UAL WHO MEETS 17
THE REQUIREMENTS OF THIS SECTION. 18
(B) TO BE ELIGIBLE FOR A POLICY ISSUED UNDER THIS SUBTITLE, AN 19
INDIVIDUAL: 20
(1) MUST OWN, LEASE, OR RENT A PRIMARY PL ACE OF RESIDEN CE IN 21
BALTIMORE CITY, OR OTHERWISE DEMONST RATE THAT THE INDIVI DUAL’S 22
PRIMARY PLACE OF RES IDENCE IS IN BALTIMORE CITY; 23
(2) MUST HAVE FILED AS A STATE RESIDENT FOR IN COME TAX 24
PURPOSES, IF REQUIRED BY LAW ; 25
(3) MUST BE IN A HOUSEHO LD WITH A GROSS ANNU AL HOUSEHOLD 26
INCOME THAT DOES NOT EXCEED 300% OF THE FEDERAL POVER TY LEVEL; 27
(4) MUST BE AT LEAST 19 YEARS OLD AND HAVE B EEN CONTINUOUSLY 28
LICENSED TO DRIVE AN AUTOMOBILE FOR THE I MMEDIATELY PRECEDING 3 YEARS; 29 4 HOUSE BILL 355
(5) MAY HAVE ONE OF EITH ER OF THE FOLLOWING , BUT NOT MORE 1
THAN ONE OF EITHER A ND NOT BOTH , WITHIN THE IMMEDIATE LY PRECEDING 3 2
YEARS: 3
(I) A PROPERTY –DAMAGE–ONLY ACCIDENT IN WHI CH THE 4
DRIVER WAS PRINCIPAL LY AT FAULT; OR 5
(II) A POINT FOR A MOVING VIOLATION; 6
(6) MAY NOT HAVE ON RECO RD WITHIN THE IMMEDIATELY 7
PRECEDING 3 YEARS AN AT–FAULT ACCIDENT INVOL VING BODILY INJURY O R 8
DEATH; AND 9
(7) MAY NOT HAVE A FELON Y OR MISDEMEANOR CON VICTION FOR A 10
VIOLATION OF THE MOT OR VEHICLE LAWS OTHE R THAN FOR A VIOLATI ON OF § 11
17–107 OF THE TRANSPORTATION ARTICLE. 12
(C) (1) THE ELIGIBILITY OF AN APPLICANT FOR INSURA NCE FROM THE 13
PROGRAM SHALL BE CERT IFIED AT A TIME AND IN A MANNER APPROVED BY THE 14
PROGRAM. 15
(2) (I) IN ESTABLISHING ACCEP TABLE METHODS THAT 16
DEMONSTRATE THE ELIG IBILITY OF INDIVIDUALS UNDER SUBSECTION (B)(3) OF 17
THIS SECTION, THE PROGRAM SHALL DETERMI NE METHODS THAT ARE THE LEAST 18
CUMBERSOME METHODS A VAILABLE. 19
(II) TO BE ELIGIBLE TO REN EW A POLICY ISSUED U NDER THIS 20
SUBTITLE, AN INDIVIDUAL SHALL DEMONSTRATE ELIGIBIL ITY UNDER SUBSECTION 21
(B)(3) OF THIS SECTION AT L EAST ONCE EVERY 3 YEARS. 22
(D) AS SOON AS PRACTICABL E, THE PROGRAM SHALL ALLOW A N APPLICANT 23
TO DEMONSTRATE ELIGI BILITY FOR THE PROGRAM AND PURCHASE A POLICY 24
ISSUED BY THE PROGRAM ONLINE . 25
20–6A–04. 26
(A) EXCEPT AS OTHERWISE PROV IDED IN THIS SECTION , EACH POLICY 27
ISSUED BY THE PROGRAM SHALL CONTAIN THE MINIMUM COVERAGE S REQUIRED 28
UNDER TITLE 19, SUBTITLE 5 OF THIS ARTICLE. 29
(B) EACH POLICY ISSUED BY THE PROGRAM MAY PROVIDE C OVERAGE ONLY 30
FOR AN AUTOMOBILE WI TH A VALUE OF $25,000 OR LESS AT THE TIME OF 31
APPLICATION, AS EVIDENCED BY THE VALUE GIVEN TO THE A UTOMOBILE BY THE 32 HOUSE BILL 355 5
MOTOR VEHICLE ADMINISTRATION IN ASS ESSING VEHICLE REGISTRATION FEES. 1
(C) (1) EXCEPT AS OTHERWISE P ROVIDED IN THIS SECT ION, EACH 2
POLICY ISSUED BY THE PROGRAM MAY PROVIDE O NLY FOR: 3
(I) THE PAYMENT OF CLAIM S FOR BODILY INJURY OR DEATH 4
ARISING FROM AN ACCI DENT OF UP TO $15,000 FOR ANY ONE PERSON A ND UP TO 5
$30,000 FOR ANY TWO OR MORE PERSONS, IN ADDITION TO INTER EST AND COSTS; 6
AND 7
(II) THE PAYMENT OF CLAIMS FO R PROPERTY OF OTHERS 8
DAMAGED OR DESTROYED IN AN ACCIDENT OF UP TO $7,500 IN ADDITION TO 9
INTEREST AND COSTS . 10
(2) NOTWITHSTANDING ANY O THER PROVISION OF TH IS ARTICLE, A 11
POLICY ISSUED BY THE PROGRAM SHALL SATISFY THE MINIMUM SECURITY 12
REQUIRED BY § 17–103 OF THE TRANSPORTATION ARTICLE. 13
(D) THE PROGRAM SHALL OFFER A N APPLICANT WHO PURC HASES A POLICY 14
ISSUED BY THE PROGRAM THE OPTION TO PURCHASE THE FOLLOWI NG ADDITIONAL 15
COVERAGES: 16
(1) UNINSURED MOTORIST C OVERAGE OR UNDERINSU RED MOTORIST 17
COVERAGE; 18
(2) PERSONAL INJURY PROT ECTION COVERAGE ; OR 19
(3) ANY OTHER COVERAGE A PPROVED BY THE COMMISSIONER . 20
20–6A–05. 21
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 22
INDICATED. 23
(2) “LOSSES INCURRED ” MEANS CLAIMS PAID , CLAIMS INCURRED 24
AND REPORTED , AND CLAIMS INCURRED BUT NOT YET REPORTED . 25
(3) “PREMIUM” MEANS THE ACTUAL AMO UNT CHARGED FOR A 26
POLICY ISSUED BY THE PROGRAM. 27
(4) “RATE” MEANS THE AVERAGE PR EMIUM REQUIRED FOR E ACH 28
INSURANCE COVERAGE U NDER A POLICY ISSUED BY THE PROGRAM. 29
6 HOUSE BILL 355
(B) SUBJECT TO THE APPROV AL OF THE COMMISSIONER , THE EXECUTIVE 1
DIRECTOR SHALL DETERM INE THE PREMIUMS TO BE CHARGED ON POLICI ES ISSUED 2
BY THE PROGRAM. 3
(C) (1) RATES CHARGED FOR POL ICIES ISSUED BY THE PROGRAM SHALL 4
BE ADEQUATE TO COVER : 5
(I) LOSSES INCURRED FOR CLAIMS FILED UNDER T HE POLICY; 6
AND 7
(II) PROGRAM EXPENSES INCU RRED BY THE PROGRAM TO 8
PROVIDE THE POLICY , INCLUDING ALL REASON ABLE AND NECESSARY E XPENSES 9
FOR THE COSTS OF ADM INISTRATION, UNDERWRITING , TAXES, COMMISSION, AND 10
CLAIMS ADJUSTING . 11
(2) IN ASSESSING LOSS RES ERVES, THE COMMISSIONER SHALL 12
ALLOW ONLY LOSS RESE RVES THAT ARE ESTIMA TED FROM ACTUAL CLAI M LOSSES 13
UNDER POLICIES ISSUE D BY THE PROGRAM OR COMPARABLE DATA BY A LICENSED 14
STATISTICAL AGENT , AS ADJUSTED TO REFLE CT COVERAGE PROVIDED UNDER 15
POLICIES ISSUED BY T HE PROGRAM AND ELIGIBILI TY FACTORS REQUIRED TO 16
PURCHASE POLICIES IS SUED BY THE PROGRAM. 17
(D) (1) IN DETERMINING THE PR EMIUMS FOR POLICIES ISSUED BY THE 18
PROGRAM, THE PROGRAM MAY CHARGE A DIFFERE NT PREMIUM TO 19
POLICYHOLDERS FOR DR IVERS UNDER THE AGE OF 25 YEARS THAN IS CHARGE D TO 20
POLICYHOLDERS FOR DR IVERS AT LEAST 25 YEARS OLD, EXCEPT THAT THE 21
PREMIUM CHARGED FOR DRIVERS UNDER THE AG E OF 25 YEARS MAY NOT BE MOR E 22
THAN 25% HIGHER THAN THE PREMIUM CHA RGED FOR DRIVERS AT LEAST 25 YEARS 23
OLD. 24
(2) NO OTHER RATING FACTO RS MAY BE USED TO DE TERMINE THE 25
PREMIUMS OF POLICIES ISSUED BY THE PROGRAM. 26
(E) (1) THE PROGRAM SHALL FILE PR OPOSED RATES ANNUALL Y WITH 27
THE COMMISSIONER . 28
(2) THE PROGRAM MAY NOT USE T HE PROPOSED RATES UN TIL THE 29
COMMISSIONER APPROVES THE RATES. 30
(3) BEFORE TAKING ACTION ON THE PROPOSED RATE S FILED UNDER 31
PARAGRAPH (1) OF THIS SUBSECTION , THE COMMISSIONER SHALL HO LD A PUBLIC 32
HEARING TO REVIEW TH E PROPOSED RATES . 33
HOUSE BILL 355 7
20–6A–06. 1
(A) A POLICY ISSUED BY THE PROGRAM SHALL BE A 12–MONTH POLICY . 2
(B) THE PROGRAM MAY ACCEPT PR EMIUMS: 3
(1) AS PAID IN FULL; OR 4
(2) SUBJECT TO SUBSECTIO N (C) OF THIS SECTION , ON AN 5
INSTALLMENT BASIS . 6
(C) (1) EXCEPT AS PROVIDED IN PARAGRAPH (2) OF THIS SUBSECTION , 7
THE PROGRAM SHALL OFFER A N INSTALLMENT PAYMEN T PLAN THAT REQUIRES : 8
(I) AN INITIAL PREMIUM P AYMENT TO BE NOT LES S THAN 16% 9
OF THE TOTAL ANNUAL PREMIUM; AND 10
(II) OF THE REMAINING PRE MIUM DUE, EQUAL AMOUNTS OF 11
INSTALLMENT PAYME NTS DUE EACH MONTH B EGINNING IN THE THIR D MONTH OF 12
THE POLICY PERIOD AN D ENDING IN THE TENT H MONTH OF THE POLIC Y PERIOD. 13
(2) THE PROGRAM MAY OFFER AN ALTERNATIVE PAYMENT PLAN TO 14
THE PAYMENT PLAN SPE CIFIED UNDER PARAGRA PH (1) OF THIS SUBSECTION A S 15
THE PROGRAM DETERMINES APP ROPRIATE. 16
(D) (1) (I) THE PROGRAM MAY IMPOSE AN ADMINISTRATIVE 17
PROCESSING FEE ON PO LICYHOLDERS PARTICIP ATING IN AN INSTALLM ENT PLAN 18
OF NOT MORE THAN $3 PER INSTALLMENT PAYM ENT. 19
(II) AN ADMINISTRATIVE PRO CESSING FEE MAY NOT BE 20
CHARGED ON AN INITIA L PREMIUM PAYMENT . 21
(2) SUBJECT TO THE APPROV AL OF THE COMMISSIONER , THE 22
ADMINISTRATIVE PROCE SSING FEE SHALL BE J USTIFIED BASED ON AC TUAL COSTS 23
RELATED TO COLLECTIN G INSTALLMENT PAYMEN TS. 24
(E) (1) IN ACCORDANCE WITH PA RAGRAPH (2) OF THIS SUBSECTION , THE 25
PROGRAM SHALL ACCEPT PAYMENTS FOR PREMIUM S USING THE FOLLOWIN G 26
METHODS: 27
(I) CASH; 28
(II) CHECK; 29 8 HOUSE BILL 355
(III) MONEY ORDER ; 1
(IV) DEBIT CARD; 2
(V) CREDIT CARD; 3
(VI) PRODUCER SWEEP ACCOU NT; AND 4
(VII) ANY OTHER METHOD THE PROGRAM DETERMINES 5
APPROPRIATE . 6
(2) ANY FEE ASSOCIATED WI TH A PAYMENT METHOD SHALL BE 7
INCLUDED IN THE MAXI MUM ADMINISTRATIVE P ROCESSING FEE ALLOWA BLE 8
UNDER SUBSECTION (D) OF THIS SECTION. 9
(F) POLICIES ISSUED BY TH E PROGRAM MAY NOT BE FI NANCED UNDER A 10
PREMIUM FINANCE AGRE EMENT. 11
20–6A–07. 12
(A) A FUND PRODUCER MAY BIN D COVERAGE IN THE FUND FOR AN 13
APPLICANT TO THE PROGRAM IF THE APPLIC ANT SUBMITS AN APPLI CATION TO THE 14
FUND PRODUCER AND PAY S THE REQUIRED PREMI UM. 15
(B) A FUND PRODUCER SHALL P ROVIDE NOTICE TO AN APPLICANT FOR A 16
POLICY UNDER THIS SU BTITLE ABOUT THE LIM ITATIONS UNDER THE P OLICY. 17
20–6A–08. 18
(A) THE PROGRAM MAY : 19
(1) SUBJECT TO SUBSECTIO N (B) OF THIS SECTION , REJECT AN 20
APPLICATION FOR INSU RANCE IF THE APPLICA NT OWES TO THE PROGRAM AN 21
UNPAID PREMIUM ON AN EXPIRE D OR CANCELED POLICY ; 22
(2) CANCEL A POLICY FOR NONPAYMENT OF PREMIU M AT ANY TIME 23
AFTER A MINIMUM OF 10 CALENDAR DAYS ’ NOTICE OF NONPAYMENT ; 24
(3) REJECT AN APPLICATIO N FOR INSURANCE OR A T ANY TIME 25
CANCEL A POLICY IF T HE DRIVER’S LICENSE OF THE APPLICAN T OR POLICYHOLDER 26
IS SUSPENDED OR REVO KED; AND 27
HOUSE BILL 355 9
(4) NONRENEW A POLICY IF THE INSURED FAILS TO MEET THE 1
ELIGIBILITY REQUIREM ENTS UNDER § 20–6A–03 OF THIS SUBTITLE. 2
(B) (1) IF THE PROGRAM REJECTS AN AP PLICATION UNDER SUBS ECTION 3
(A)(1) OF THIS SECTION, THE PROGRAM SHALL : 4
(I) NOTIFY THE APPLICANT OF THE AMOUNT OF THE UNPAID 5
PREMIUM; AND 6
(II) ALLOW THE APPLICANT TO CURE THE DEFICIEN CY. 7
(2) IF THE APPLICANT CURE S THE DEFICIENCY , THE PROGRAM MAY 8
NOT REJECT THE APPLI CANT IF THE APPLICANT IS OTHERWISE ELIGIBLE. 9
20–6A–09. 10
(A) ALL INSURERS LICENSED TO WRITE MOTOR VEHIC LE LIABILITY 11
INSURANCE OR MOTOR V EHICLE PHYSICAL DAMA GE INSURANCE IN THE STATE 12
SHALL PAY AN ANNUAL FEE OF 10 CENTS PER VEHICLE INSURED BY THE INSURER 13
TO SUPPORT THE PROGRAM’S MARKETING , OUTREACH, AND OTHER PUBLIC 14
EDUCATION EFFORTS RE QUIRED TO RAISE PUBL IC AWARENESS OF THE PROGRAM. 15
(B) THE HOUSE ECONOMIC MATTERS COMMITTEE AND THE SENATE 16
FINANCE COMMITTEE SHALL REVIE W ANNUALLY THE PUBLIC AWARENESS 17
EXPENDITURES INCURRE D BY THE PROGRAM UNDER SUBSECT ION (A) OF THIS 18
SECTION. 19
20–6A–10. 20
THE BOARD OF TRUSTEES, IN CONSULTATION WITH THE ADMINISTRATION , 21
SHALL ADOPT REGULATI ONS TO CARRY OUT THI S SUBTITLE, INCLUDING 22
REGULATIONS THAT RELATE TO PROCE DURES FOR THE CANCEL LATION AND 23
NONRENEWAL OF POLICI ES ISSUED UNDER THIS SUBTITLE. 24
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 25
October 1, 2023. 26