As Reported by the House Insurance Committee

129th General Assembly Regular Session 2011-2012

Sub. H. B. No. 278

Representatives Stebelton, Okey 

Cosponsors: Representatives Adams, R., Bubp, Combs, Foley, Grossman, Hollington, Huffman, Letson, Maag, McGregor, McKenney, Murray 

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A BILL

To amend sections 3901.21, 3937.30, 3937.31, 3937.32,

1

3937.33, 3937.34, 3937.35, 4509.01, 4509.20,

2

4509.41, and 4509.51 of the Revised Code to make

3

changes to the law governing automobile insurance

4

policies, to increase the minimum amounts required

5

for valid proof of financial responsibility, to

6

make it an unfair and deceptive act or practice in

7

the business of insurance to charge excessive,

8

inadequate, or unfairly discriminatory premium

9

rates in private passenger automobile insurance

10

based solely on the insured's residence location,

11

and to reduce from two years to one year the

12

minimum policy period for automobile insurance

13

policies.

14

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 3901.21, 3937.30, 3937.31, 3937.32,	15
3937.33, 3937.34, 3937.35, 4509.01, 4509.20, 4509.41, and 4509.51	16
of the Revised Code be amended to read as follows:	17

Sec. 3901.21.  The following are hereby defined as unfair and	18
deceptive acts or practices in the business of insurance:	19

(A) Making, issuing, circulating, or causing or permitting to	20
be made, issued, or circulated, or preparing with intent to so	21
use, any estimate, illustration, circular, or statement	22
misrepresenting the terms of any policy issued or to be issued or	23
the benefits or advantages promised thereby or the dividends or	24
share of the surplus to be received thereon, or making any false	25
or misleading statements as to the dividends or share of surplus	26
previously paid on similar policies, or making any misleading	27
representation or any misrepresentation as to the financial	28
condition of any insurer as shown by the last preceding verified	29
statement made by it to the insurance department of this state, or	30
as to the legal reserve system upon which any life insurer	31
operates, or using any name or title of any policy or class of	32
policies misrepresenting the true nature thereof, or making any	33
misrepresentation or incomplete comparison to any person for the	34
purpose of inducing or tending to induce such person to purchase,	35
amend, lapse, forfeit, change, or surrender insurance.	36

Any written statement concerning the premiums for a policy	37
which refers to the net cost after credit for an assumed dividend,	38
without an accurate written statement of the gross premiums, cash	39
values, and dividends based on the insurer's current dividend	40
scale, which are used to compute the net cost for such policy, and	41
a prominent warning that the rate of dividend is not guaranteed,	42
is a misrepresentation for the purposes of this division.	43

(B) Making, publishing, disseminating, circulating, or	44
placing before the public or causing, directly or indirectly, to	45
be made, published, disseminated, circulated, or placed before the	46
public, in a newspaper, magazine, or other publication, or in the	47
form of a notice, circular, pamphlet, letter, or poster, or over	48
any radio station, or in any other way, or preparing with intent	49
to so use, an advertisement, announcement, or statement containing	50
any assertion, representation, or statement, with respect to the	51
business of insurance or with respect to any person in the conduct	52
of the person's insurance business, which is untrue, deceptive, or	53
misleading.	54

(C) Making, publishing, disseminating, or circulating,	55
directly or indirectly, or aiding, abetting, or encouraging the	56
making, publishing, disseminating, or circulating, or preparing	57
with intent to so use, any statement, pamphlet, circular, article,	58
or literature, which is false as to the financial condition of an	59
insurer and which is calculated to injure any person engaged in	60
the business of insurance.	61

(D) Filing with any supervisory or other public official, or	62
making, publishing, disseminating, circulating, or delivering to	63
any person, or placing before the public, or causing directly or	64
indirectly to be made, published, disseminated, circulated,	65
delivered to any person, or placed before the public, any false	66
statement of financial condition of an insurer.	67

Making any false entry in any book, report, or statement of	68
any insurer with intent to deceive any agent or examiner lawfully	69
appointed to examine into its condition or into any of its	70
affairs, or any public official to whom such insurer is required	71
by law to report, or who has authority by law to examine into its	72
condition or into any of its affairs, or, with like intent,	73
willfully omitting to make a true entry of any material fact	74
pertaining to the business of such insurer in any book, report, or	75
statement of such insurer, or mutilating, destroying, suppressing,	76
withholding, or concealing any of its records.	77

(E) Issuing or delivering or permitting agents, officers, or	78
employees to issue or deliver agency company stock or other	79
capital stock or benefit certificates or shares in any common-law	80
corporation or securities or any special or advisory board	81
contracts or other contracts of any kind promising returns and	82
profits as an inducement to insurance.	83

(F) Making or permitting any unfair discrimination among	84
individuals of the same class and equal expectation of life in the	85
rates charged for any contract of life insurance or of life	86
annuity or in the dividends or other benefits payable thereon, or	87
in any other of the terms and conditions of such contract.	88

(G)(1) Except as otherwise expressly provided by law,	89
knowingly permitting or offering to make or making any contract of	90
life insurance, life annuity or accident and health insurance, or	91
agreement as to such contract other than as plainly expressed in	92
the contract issued thereon, or paying or allowing, or giving or	93
offering to pay, allow, or give, directly or indirectly, as	94
inducement to such insurance, or annuity, any rebate of premiums	95
payable on the contract, or any special favor or advantage in the	96
dividends or other benefits thereon, or any valuable consideration	97
or inducement whatever not specified in the contract; or giving,	98
or selling, or purchasing, or offering to give, sell, or purchase,	99
as inducement to such insurance or annuity or in connection	100
therewith, any stocks, bonds, or other securities, or other	101
obligations of any insurance company or other corporation,	102
association, or partnership, or any dividends or profits accrued	103
thereon, or anything of value whatsoever not specified in the	104
contract.	105

(2) Nothing in division (F) or division (G)(1) of this	106
section shall be construed as prohibiting any of the following	107
practices: (a) in the case of any contract of life insurance or	108
life annuity, paying bonuses to policyholders or otherwise abating	109
their premiums in whole or in part out of surplus accumulated from	110
nonparticipating insurance, provided that any such bonuses or	111
abatement of premiums shall be fair and equitable to policyholders	112
and for the best interests of the company and its policyholders;	113
(b) in the case of life insurance policies issued on the	114
industrial debit plan, making allowance to policyholders who have	115
continuously for a specified period made premium payments directly	116
to an office of the insurer in an amount which fairly represents	117
the saving in collection expenses; (c) readjustment of the rate of	118
premium for a group insurance policy based on the loss or expense	119
experience thereunder, at the end of the first or any subsequent	120
policy year of insurance thereunder, which may be made retroactive	121
only for such policy year.	122

(H) Making, issuing, circulating, or causing or permitting to	123
be made, issued, or circulated, or preparing with intent to so	124
use, any statement to the effect that a policy of life insurance	125
is, is the equivalent of, or represents shares of capital stock or	126
any rights or options to subscribe for or otherwise acquire any	127
such shares in the life insurance company issuing that policy or	128
any other company.	129

(I) Making, issuing, circulating, or causing or permitting to	130
be made, issued or circulated, or preparing with intent to so	131
issue, any statement to the effect that payments to a policyholder	132
of the principal amounts of a pure endowment are other than	133
payments of a specific benefit for which specific premiums have	134
been paid.	135

(J) Making, issuing, circulating, or causing or permitting to	136
be made, issued, or circulated, or preparing with intent to so	137
use, any statement to the effect that any insurance company was	138
required to change a policy form or related material to comply	139
with Title XXXIX of the Revised Code or any regulation of the	140
superintendent of insurance, for the purpose of inducing or	141
intending to induce any policyholder or prospective policyholder	142
to purchase, amend, lapse, forfeit, change, or surrender	143
insurance.	144

(K) Aiding or abetting another to violate this section.

145

(L) Refusing to issue any policy of insurance, or canceling	146
or declining to renew such policy because of the sex or marital	147
status of the applicant, prospective insured, insured, or	148
policyholder.	149

(M) Making or permitting any unfair discrimination between	150
individuals of the same class and of essentially the same hazard	151
in the amount of premium, policy fees, or rates charged for any	152
policy or contract of insurance, other than life insurance, or in	153
the benefits payable thereunder, or in underwriting standards and	154
practices or eligibility requirements, or in any of the terms or	155
conditions of such contract, or in any other manner whatever.	156

(N) Refusing to make available disability income insurance	157
solely because the applicant's principal occupation is that of	158
managing a household.	159

(O) Refusing, when offering maternity benefits under any	160
individual or group sickness and accident insurance policy, to	161
make maternity benefits available to the policyholder for the	162
individual or individuals to be covered under any comparable	163
policy to be issued for delivery in this state, including family	164
members if the policy otherwise provides coverage for family	165
members. Nothing in this division shall be construed to prohibit	166
an insurer from imposing a reasonable waiting period for such	167
benefits under an individual sickness and accident insurance	168
policy issued to an individual who is not a federally eligible	169
individual or a nonemployer-related group sickness and accident	170
insurance policy, but in no event shall such waiting period exceed	171
two hundred seventy days.	172

For purposes of division (O) of this section, "federally	173
eligible individual" means an eligible individual as defined in 45	174
C.F.R. 148.103.	175

(P) Using, or permitting to be used, a pattern settlement as	176
the basis of any offer of settlement. As used in this division,	177
"pattern settlement" means a method by which liability is	178
routinely imputed to a claimant without an investigation of the	179
particular occurrence upon which the claim is based and by using a	180
predetermined formula for the assignment of liability arising out	181
of occurrences of a similar nature. Nothing in this division shall	182
be construed to prohibit an insurer from determining a claimant's	183
liability by applying formulas or guidelines to the facts and	184
circumstances disclosed by the insurer's investigation of the	185
particular occurrence upon which a claim is based.	186

(Q) Refusing to insure, or refusing to continue to insure, or	187
limiting the amount, extent, or kind of life or sickness and	188
accident insurance or annuity coverage available to an individual,	189
or charging an individual a different rate for the same coverage	190
solely because of blindness or partial blindness. With respect to	191
all other conditions, including the underlying cause of blindness	192
or partial blindness, persons who are blind or partially blind	193
shall be subject to the same standards of sound actuarial	194
principles or actual or reasonably anticipated actuarial	195
experience as are sighted persons. Refusal to insure includes, but	196
is not limited to, denial by an insurer of disability insurance	197
coverage on the grounds that the policy defines "disability" as	198
being presumed in the event that the eyesight of the insured is	199
lost. However, an insurer may exclude from coverage disabilities	200
consisting solely of blindness or partial blindness when such	201
conditions existed at the time the policy was issued. To the	202
extent that the provisions of this division may appear to conflict	203
with any provision of section 3999.16 of the Revised Code, this	204
division applies.	205

(R)(1) Directly or indirectly offering to sell, selling, or	206
delivering, issuing for delivery, renewing, or using or otherwise	207
marketing any policy of insurance or insurance product in	208
connection with or in any way related to the grant of a student	209
loan guaranteed in whole or in part by an agency or commission of	210
this state or the United States, except insurance that is required	211
under federal or state law as a condition for obtaining such a	212
loan and the premium for which is included in the fees and charges	213
applicable to the loan; or, in the case of an insurer or insurance	214
agent, knowingly permitting any lender making such loans to engage	215
in such acts or practices in connection with the insurer's or	216
agent's insurance business.	217

(2) Except in the case of a violation of division (G) of this	218
section, division (R)(1) of this section does not apply to either	219
of the following:	220

(a) Acts or practices of an insurer, its agents,	221
representatives, or employees in connection with the grant of a	222
guaranteed student loan to its insured or the insured's spouse or	223
dependent children where such acts or practices take place more	224
than ninety days after the effective date of the insurance;	225

(b) Acts or practices of an insurer, its agents,	226
representatives, or employees in connection with the solicitation,	227
processing, or issuance of an insurance policy or product covering	228
the student loan borrower or the borrower's spouse or dependent	229
children, where such acts or practices take place more than one	230
hundred eighty days after the date on which the borrower is	231
notified that the student loan was approved.	232

(S) Denying coverage, under any health insurance or health	233
care policy, contract, or plan providing family coverage, to any	234
natural or adopted child of the named insured or subscriber solely	235
on the basis that the child does not reside in the household of	236
the named insured or subscriber.	237

(T)(1) Using any underwriting standard or engaging in any	238
other act or practice that, directly or indirectly, due solely to	239
any health status-related factor in relation to one or more	240
individuals, does either of the following:	241

(a) Terminates or fails to renew an existing individual	242
policy, contract, or plan of health benefits, or a health benefit	243
plan issued to an employer, for which an individual would	244
otherwise be eligible;	245

(b) With respect to a health benefit plan issued to an	246
employer, excludes or causes the exclusion of an individual from	247
coverage under an existing employer-provided policy, contract, or	248
plan of health benefits.	249

(2) The superintendent of insurance may adopt rules in	250
accordance with Chapter 119. of the Revised Code for purposes of	251
implementing division (T)(1) of this section.	252

(3) For purposes of division (T)(1) of this section, "health	253
status-related factor" means any of the following:	254

(a) Health status;

255

(b) Medical condition, including both physical and mental	256
illnesses;	257

(c) Claims experience;

258

(d) Receipt of health care;

259

(e) Medical history;

260

(f) Genetic information;

261

(g) Evidence of insurability, including conditions arising	262
out of acts of domestic violence;	263

(h) Disability.

264

(U) With respect to a health benefit plan issued to a small	265
employer, as those terms are defined in section 3924.01 of the	266
Revised Code, negligently or willfully placing coverage for	267
adverse risks with a certain carrier, as defined in section	268
3924.01 of the Revised Code.	269

(V) Using any program, scheme, device, or other unfair act or	270
practice that, directly or indirectly, causes or results in the	271
placing of coverage for adverse risks with another carrier, as	272
defined in section 3924.01 of the Revised Code.	273

(W) Failing to comply with section 3923.23, 3923.231,	274
3923.232, 3923.233, or 3923.234 of the Revised Code by engaging in	275
any unfair, discriminatory reimbursement practice.	276

(X) Intentionally establishing an unfair premium for, or	277
misrepresenting the cost of, any insurance policy financed under a	278
premium finance agreement of an insurance premium finance company.	279

(Y)(1)(a) Limiting coverage under, refusing to issue,	280
canceling, or refusing to renew, any individual policy or contract	281
of life insurance, or limiting coverage under or refusing to issue	282
any individual policy or contract of health insurance, for the	283
reason that the insured or applicant for insurance is or has been	284
a victim of domestic violence;	285

(b) Adding a surcharge or rating factor to a premium of any	286
individual policy or contract of life or health insurance for the	287
reason that the insured or applicant for insurance is or has been	288
a victim of domestic violence;	289

(c) Denying coverage under, or limiting coverage under, any	290
policy or contract of life or health insurance, for the reason	291
that a claim under the policy or contract arises from an incident	292
of domestic violence;	293

(d) Inquiring, directly or indirectly, of an insured under,	294
or of an applicant for, a policy or contract of life or health	295
insurance, as to whether the insured or applicant is or has been a	296
victim of domestic violence, or inquiring as to whether the	297
insured or applicant has sought shelter or protection from	298
domestic violence or has sought medical or psychological treatment	299
as a victim of domestic violence.	300

(2) Nothing in division (Y)(1) of this section shall be	301
construed to prohibit an insurer from inquiring as to, or from	302
underwriting or rating a risk on the basis of, a person's physical	303
or mental condition, even if the condition has been caused by	304
domestic violence, provided that all of the following apply:	305

(a) The insurer routinely considers the condition in	306
underwriting or in rating risks, and does so in the same manner	307
for a victim of domestic violence as for an insured or applicant	308
who is not a victim of domestic violence;	309

(b) The insurer does not refuse to issue any policy or	310
contract of life or health insurance or cancel or refuse to renew	311
any policy or contract of life insurance, solely on the basis of	312
the condition, except where such refusal to issue, cancellation,	313
or refusal to renew is based on sound actuarial principles or is	314
related to actual or reasonably anticipated experience;	315

(c) The insurer does not consider a person's status as being	316
or as having been a victim of domestic violence, in itself, to be	317
a physical or mental condition;	318

(d) The underwriting or rating of a risk on the basis of the	319
condition is not used to evade the intent of division (Y)(1) of	320
this section, or of any other provision of the Revised Code.	321

(3)(a) Nothing in division (Y)(1) of this section shall be	322
construed to prohibit an insurer from refusing to issue a policy	323
or contract of life insurance insuring the life of a person who is	324
or has been a victim of domestic violence if the person who	325
committed the act of domestic violence is the applicant for the	326
insurance or would be the owner of the insurance policy or	327
contract.	328

(b) Nothing in division (Y)(2) of this section shall be	329
construed to permit an insurer to cancel or refuse to renew any	330
policy or contract of health insurance in violation of the "Health	331
Insurance Portability and Accountability Act of 1996," 110 Stat.	332
1955, 42 U.S.C.A. 300gg-41(b), as amended, or in a manner that	333
violates or is inconsistent with any provision of the Revised Code	334
that implements the "Health Insurance Portability and	335
Accountability Act of 1996."	336

(4) An insurer is immune from any civil or criminal liability	337
that otherwise might be incurred or imposed as a result of any	338
action taken by the insurer to comply with division (Y) of this	339
section.	340

(5) As used in division (Y) of this section, "domestic	341
violence" means any of the following acts:	342

(a) Knowingly causing or attempting to cause physical harm to	343
a family or household member;	344

(b) Recklessly causing serious physical harm to a family or	345
household member;	346

(c) Knowingly causing, by threat of force, a family or	347
household member to believe that the person will cause imminent	348
physical harm to the family or household member.	349

For the purpose of division (Y)(5) of this section, "family	350
or household member" has the same meaning as in section 2919.25 of	351
the Revised Code.	352

Nothing in division (Y)(5) of this section shall be construed	353
to require, as a condition to the application of division (Y) of	354
this section, that the act described in division (Y)(5) of this	355
section be the basis of a criminal prosecution.	356

(Z) Disclosing a coroner's records by an insurer in violation	357
of section 313.10 of the Revised Code.	358

(AA) Making, issuing, circulating, or causing or permitting	359
to be made, issued, or circulated any statement or representation	360
that a life insurance policy or annuity is a contract for the	361
purchase of funeral goods or services.	362

(BB) With respect to private passenger automobile insurance,	363
no insurer shall charge differentcharging premium rates to	364
persons residing within the limits of any municipal corporation	365
that are excessive, inadequate, or unfairly discriminatory,	366
pursuant to division (D) of section 3937.02 of the Revised Code,	367
based solely on the location of the residence of the insured	368
within those limits.	369

The enumeration in sections 3901.19 to 3901.26 of the Revised	370
Code of specific unfair or deceptive acts or practices in the	371
business of insurance is not exclusive or restrictive or intended	372
to limit the powers of the superintendent of insurance to adopt	373
rules to implement this section, or to take action under other	374
sections of the Revised Code.	375

This section does not prohibit the sale of shares of any	376
investment company registered under the "Investment Company Act of	377
1940," 54 Stat. 789, 15 U.S.C.A. 80a-1, as amended, or any	378
policies, annuities, or other contracts described in section	379
3907.15 of the Revised Code.	380

As used in this section, "estimate," "statement,"	381
"representation," "misrepresentation," "advertisement," or	382
"announcement" includes oral or written occurrences.	383

Sec. 3937.30. (A) As used in sections 3937.30 to 3937.39 of	384
the Revised Code, "automobile insurance policy" means an insurance	385
policy delivered or issued in this state or covering a motor	386
vehicle required to be registered in this state which:	387

(A)(1) Provides automobile bodily injury or property damage	388
liability, or related coverage, or any combination thereof;	389

(B)(2) Insures as named insured, any of the following:

390

(1)(a) Any one person;

391

(2)(b) A husband and wife resident in the same household;

392

(3)(c) Either a husband or a wife who reside in the same	393
household if an endorsement on the policy excludes the other	394
spouse from coverage under the policy and the spouse excluded	395
signs the endorsement. Nothing in this division (B)(3)(A)(2)(c) of	396
this section shall prevent the issuance of separate policies to	397
each spouse or affect the compliance of the policy with Chapter	398
4509. of the Revised Code as to the named insured or any	399
additional insured.	400

(C) Insures only private passenger motor vehicles or other	401
four-wheeled motor vehicles which are classified or rated as	402
private passenger vehicles and are not used as public or private	403
livery, or rental conveyances;	404

(D) Does not insure more than four motor vehicles;

405

(E)(3) Does not cover garage, automobile sales agency, repair	406
shop, service station, or public parking operation hazards;	407

(F)(4) Is not issued under an assigned risk plan pursuant to	408
section 4509.70 of the Revised Code.	409

(B) For purposes of this section, "motor vehicle," means a	410
self-propelled vehicle designed for and principally used on public	411
roads, including an automobile, truck, motorcycle, and a motor	412
home, provided the motor home is not stationary and is not being	413
used as a temporary or permanent residence or office. "Motor	414
vehicle" does not include a trailer, motorized bicycle, golf cart,	415
off-road recreational vehicle, snowmobile, watercraft,	416
construction equipment, farm tractor or other vehicle designed and	417
principally used for agricultural purposes, mobile home, vehicle	418
traveling on treads or rails, or any similar vehicle.	419

Sec. 3937.31.  (A) Every automobile insurance policy shall be	420
issued for a period of not less than two yearsone year or	421
guaranteed renewable for successive policy periods totaling not	422
less than two yearsone year. Where renewal is mandatory,	423
"cancellation," as used in sections 3937.30 to 3937.39 of the	424
Revised Code, includes refusal to renew a policy with at least the	425
coverages, included insureds, and policy limits provided at the	426
end of the next preceding policy period. No insurer may cancel any	427
suchautomobile insurance policy except pursuant to the terms of	428
the policy, and in accordance with sections 3937.30 to 3937.39 of	429
the Revised Code, and for one or more of the following reasons:	430

(1) MisrepresentationFraud, concealment, or	431
misrepresentation by the insured to the insurer of any material	432
fact in the procurement or renewal of the insurance or in the	433
submission of claims thereunder;	434

(2) Loss of driving privileges through suspension,	435
revocation, or expiration of the driver's or commercial driver's	436
license of the named insured or any member of the named insured's	437
family covered as a driver; provided that the insurer shall	438
continue the policy in effect but exclude by endorsement all	439
coverage as to the person whose driver's license has been	440
suspended, revoked, or has expired, if the person is other than	441
the named insured or the principal operator;	442

(3) Nonpayment of premium, which means failure of the named	443
insured to discharge when due any of the named insured's	444
obligations in connection with the payment of premiums on a	445
policy, or any installment of such premiums, whether the premium	446
is payable directly to the insurer or its agent or indirectly	447
under any premium finance plan or extension of credit;	448

(4) The place of residence of the insured or the state of	449
registration or license of the insured automobile is changed to a	450
state or country in which the insurer is not authorized to write	451
automobile coverage.	452

This section does not apply in the case of a cancellation if	453
the insurer has indicated its willingness to issue a new policy	454
within the same insurer or within another insurer under the same	455
ownership or management as that of the insurer that has issued the	456
cancellation.	457

(B) Sections 3937.30 to 3937.39 of the Revised Code do not	458
prohibit:	459

(1) Changes in coverage or policy limits, cancellation, or	460
nonrenewal for any reason at the request or with the consent of	461
the insured;	462

(2) Lawful surcharges, adjustments, or other changes in	463
premium;	464

(3) Policy modification to all policies issued to a	465
classification of risk which do not effect a withdrawal or	466
reduction in the initial coverage or policy limits;	467

(4) An insurer's refusing for any reason to renew a policy	468
upon its expiration at the end of any mandatory period, provided	469
such nonrenewal complies with the procedure set forth in section	470
3937.34 of the Revised Code.	471

(C) Sections 3937.30 to 3937.39 of the Revised Code do not	472
apply to any policy or coverage that has been in effect less than	473
ninety days at the time notice of cancellation is mailed by the	474
insurer, unless it is a renewal policy.	475

(D) Renewal of a policy does not constitute a waiver or	476
estoppel with respect to grounds for cancellation that existed	477
before the effective date of such renewal.	478

(E) Nothing in this section prohibits an insurer from	479
incorporating into a policy any changes that are permitted or	480
required by this section or other sections of the Revised Code at	481
the beginning of any policy period within the two-yearone-year	482
period set forth in division (A) of this section.	483

Sec. 3937.32.  No cancellation of an automobile insurance	484
policy is effective, unless it is pursuant to written notice to	485
the insured of cancellation. Such notice shall contain:	486

(A) The policy number;

487

(B) The date of the notice;

488

(C) The effective date of cancellation of the policy, which	489
shall not be earlier than thirty days following the date of the	490
notice;	491

(D) An explanation of the reason for cancellation and the	492
information upon which it is based, or a statement that such	493
explanation will be furnished to the insured in writing within	494
five days after receipt of histhe insured's written request	495
therefor to the insurer;	496

(E) Where cancellation is for nonpayment of premium at least	497
ten days notice from the date of mailing of cancellation	498
accompanied by the reason thereforetherefor shall be given;	499

(F) A statement that if there is cause to believe such	500
cancellation is based on erroneous information, or is contrary to	501
law or the terms of the policy, the insured is entitled to have	502
the matter reviewed by the superintendent of insurance, upon	503
written application to the superintendent made not later than the	504
effective date of cancellation of the policy, and that if a	505
hearing is held by the superintendent of insurance, a deposit of	506
five dollars shall be made, and that such deposit shall be	507
returned to the insured if the finding is in his favor.	508

Sec. 3937.33.  An insurer may cancel an automobile insurance	509
policy at such time prior to its expiration for such reasons as	510
may be permitted by section 3937.31 of the Revised Code, by	511
mailing to the insured, at histhe insured's last known address	512
appearing on the insurer's records, at least thirty days prior to	513
the effective date of cancellation, a notice of cancellation	514
pursuant to section 3937.32 of the Revised Code. If such notice of	515
cancellation, for a reason other than nonpayment of premium, does	516
not contain an explanation of the reason for cancellation and the	517
information upon which it is based, the insurer shall, within five	518
days after receipt of the written request therefor by the insured,	519
furnish explanation to the insured in writing. Prior to the	520
effective date of cancellation, the insurer shall tenderrefund to	521
the insured any refund premium and other sums which may be due the	522
insured.	523

Upon compliance by the insurer with all requirements of this	524
section, such automobile insurance policy is cancelled on the	525
effective date stated in the notice of cancellation, except as	526
otherwise provided in section 3937.35 of the Revised Code. In the	527
event of the insurer's failure to comply with any requirement of	528
this section, such cancellation shall be ineffective and the	529
policy shall continue in force until such time as it is cancelled	530
or otherwise terminated pursuant to law and the terms of the	531
policy.	532

Sec. 3937.34.  An insurer may refuse to renew an automobile	533
insurance policy by mailing to the insured, at histhe insured's	534
last known address appearing on the insurer's records, and at	535
least thirty days prior to the date of expiration of the policy, a	536
notice of the insurer's intention not to renew the policy. Such	537
notice shall contain:	538

(A) The policy number;

539

(B) The date of the notice;

540

(C) The effective date of expiration;

541

(D) An explanation of the reason for nonrenewal and the	542
information upon which it is based, or a statement that such	543
explanation will be furnished to the insured in writing within	544
five days after receipt of histhe insured's written request	545
therefor to the insurer.	546

Upon compliance by the insurer with all requirements of this	547
section, such motor vehicleautomobile insurance policy expires on	548
the expiration date stated in the policy and notice of intention	549
not to renew.	550

Sec. 3937.35.  Upon receipt of a notice of cancellation given	551
pursuant to section 3937.33 of the Revised Code at any time prior	552
to the effective date of cancellation of a motor vehiclean	553
automobile insurance policy, the insured may apply in writing to	554
the superintendent of insurance for review of such cancellation.	555
If the superintendent finds that grounds for hearing do not exist,	556
he shall forthwith give written notice to the insured and insurer	557
of such finding. If the superintendent finds that there is cause	558
to believe that such cancellation is based on erroneous	559
information, or is contrary to law or the terms of the policy, he	560
the superintendent shall, not later than ten days following	561
receipt of the application, hold a hearing to determine whether	562
such cancellation is effective and shall give written notice of	563
such hearingfinding to the insured and the insurer not later than	564
five days prior to the hearing thereof, provided that the insured	565
make a deposit of five dollars by the hearing date. Such deposit	566
shall be returned if the finding is in the insured's favor but	567
otherwise shall be paid into the general revenue fund by the	568
department of insurance.	569

If, upon hearing, the superintendent finds that such	570
cancellation is in accordance with law and the terms of the	571
policy, hethe superintendent shall, within five days following	572
hearing, issue hisa written orderfinding approving such	573
cancellation in such case. If such order is issued less than ten	574
days prior to the effective date of cancellation of the policy,	575
the policy shall continue in force for ten days following the date	576
of the order or until the insured secures other coverage,	577
whichever occurs first, and the order of the superintendent shall	578
so state.	579

If, upon hearingreview, the superintendent finds that such	580
cancellation is contrary to law or the terms of the policy, hethe	581
superintendent shall issue hisa written orderfinding	582
disapproving the cancellation and stating in what particulars the	583
same is improper. In such case, the policy continues in force as	584
provided in section 3937.33 of the Revised Code if the insured	585
tenders to the insurer at the time of hearing thewithin ten days	586
any premium refund made by the insurer.	587

Sec. 4509.01.  As used in sections 4509.01 to 4509.78 of the	588
Revised Code:	589

(A) "Person" includes every natural person, firm,	590
partnership, association, or corporation.	591

(B) "Driver" means every person who drives or is in actual	592
physical control of a motor vehicle.	593

(C) "License" includes any license, permit, or privilege to	594
operate a motor vehicle issued under the laws of this state	595
including:	596

(1) Any temporary instruction permit or examiner's driving	597
permit;	598

(2) The privilege of any person to drive a motor vehicle	599
whether or not such person holds a valid license;	600

(3) Any nonresident's operating privilege.

601

(D) "Owner" means a person who holds the legal title of a	602
motor vehicle. If a motor vehicle is the subject of a lease with	603
an immediate right of possession vested in the lessee, the lessee	604
is the owner. A person listed as the owner on a certificate of	605
title on which there is a notation of a security interest is the	606
owner. A buyer or other transferee of a motor vehicle who receives	607
the certificate of title from the seller or transferor listing the	608
seller or transferor thereon as the owner with an assignment of	609
title to the buyer or transferee nonetheless is the owner even	610
though a subsequent certificate of title has not been issued	611
listing the buyer or transferee as the owner.	612

(E) "Registration" means registration certificates and	613
registration plates issued under the laws of this state pertaining	614
to the registration of motor vehicles.	615

(F) "Nonresident" means every person who is not a resident of	616
this state.	617

(G) "Nonresident's operating privilege" means the privilege	618
conferred upon a nonresident by the laws of this state pertaining	619
to the operation by such person of a motor vehicle, or the use of	620
a motor vehicle owned by such person, in this state.	621

(H) "Vehicle" means every device by which any person or	622
property may be transported upon a highway, except electric	623
personal assistive mobility devices, devices moved by power	624
collected from overhead electric trolley wires, or used	625
exclusively upon stationary rails or tracks, and except devices	626
other than bicycles moved by human power.	627

(I) "Motor vehicle" means every vehicle propelled by power	628
other than muscular power or power collected from overhead	629
electric trolley wires, except motorized bicycles, road rollers,	630
traction engines, power shovels, power cranes and other equipment	631
used in construction work and not designed for or employed in	632
general highway transportation, hole-digging machinery,	633
well-drilling machinery, ditch-digging machinery, farm machinery,	634
threshing machinery, hay baling machinery, and agricultural	635
tractors and machinery used in the production of horticultural,	636
floricultural, agricultural, and vegetable products.	637

(J) "Accident" or "motor vehicle accident" means any accident	638
involving a motor vehicle which results in bodily injury to or	639
death of any person, or damage to the property of any person in	640
excess of four hundred dollars.	641

(K) "Proof of financial responsibility" means proof of	642
ability to respond in damages for liability, on account of	643
accidents occurring subsequent to the effective date of such	644
proof, arising out of the ownership, maintenance, or use of a	645
motor vehicle in the amount of twentytwenty-five thousand dollars	646
because of bodily injury to or death of one person in any one	647
accident, in the amount of fortyfifty thousand dollars because of	648
bodily injury to or death of two or more persons in any one	649
accident, and in the amount of fifteentwenty-five thousand	650
dollars because of injury to property of others in any one	651
accident.	652

(L) "Motor-vehicle liability policy" means an "owner's	653
policy" or an "operator's policy" of liability insurance,	654
certified as provided in section 4509.46 or 4509.47 of the Revised	655
Code as proof of financial responsibility, and issued, except as	656
provided in section 4509.47 of the Revised Code, by an insurance	657
carrier authorized to do business in this state, to or for the	658
benefit of the person named therein as insured.	659

Sec. 4509.20.  (A) A policy or bond does not comply with	660
divisions (A)(5), (A)(6), and (A)(7) of section 4509.19 of the	661
Revised Code unless issued by an insurance company or surety	662
company authorized to do business in this state, except as	663
provided in division (B) of this section, or unless such policy or	664
bond is subject, if the accident has resulted in bodily injury or	665
death, to a limit, exclusive of interest and costs, of not less	666
than twentytwenty-five thousand dollars because of bodily injury	667
to or death of one person in any one accident, and, subject to	668
said limit for one person, to a limit of not less than fortyfifty	669
thousand dollars because of bodily injury to or death of two or	670
more persons in one accident, and, if the accident has resulted in	671
injury to, or destruction of property, to a limit of not less than	672
fifteentwenty-five thousand dollars because of injury to or	673
destruction of property of others in any one accident.	674

(B) A policy or bond does not comply with divisions (A) (5),	675
(A) (6), and (A) (7) of section 4509.19 of the Revised Code with	676
respect to any motor vehicle which was not registered in this	677
state or was a motor vehicle which was registered elsewhere than	678
in this state at the effective date of the policy or bond or the	679
most recent renewal thereof, unless the insurance company or	680
surety company issuing such policy or bond is authorized to do	681
business in this state, or if said company is not authorized to do	682
business in this state unless it executes a power of attorney	683
authorizing the registrar of motor vehicles to accept service on	684
its behalf of notice or process in any action upon such policy or	685
bond arising out of such accident.	686

The registrar may rely upon the accuracy of the information	687
in the required report of a motor vehicle accident as to the	688
existence of insurance or a bond unless the registrar has reason	689
to believe that the information is erroneous.	690

Sec. 4509.41.  (A) Judgments are satisfied for the purpose of	691
sections 4509.01 to 4509.78 of the Revised Code, in each of the	692
following cases:	693

(1) When twentytwenty-five thousand dollars has been	694
credited upon any judgments in excess of that amount because of	695
bodily injury to or death of one person as a result of any one	696
accident;	697

(2) When the sum of fortyfifty thousand dollars has been	698
credited upon any judgments in excess of that amount because of	699
bodily injury to or death of two or more persons as the result of	700
any one accident;	701

(3) When fifteentwenty-five thousand dollars has been	702
credited upon any judgments rendered in excess of that amount	703
because of injury to property of others as a result of any one	704
accident.	705

(B) Payments made in settlements of any claims because of	706
bodily injury, death, or property damage arising from such	707
accident shall be credited in reduction of the amounts provided	708
for in this section.	709

Sec. 4509.51.  Subject to the terms and conditions of an	710
owner's policy, every owner's policy of liability insurance:	711

(A) Shall designate by explicit description or by appropriate	712
reference all motor vehicles with respect to which coverage is	713
thereby granted;	714

(B) Shall insure the person named therein and any other	715
person, as insured, using any such motor vehicles with the express	716
or implied permission of the insured, against loss from the	717
liability imposed by law for damages arising out of the ownership,	718
maintenance, or use of such vehicles within the United States or	719
Canada, subject to monetary limits exclusive of interest and	720
costs, with respect to each such motor vehicle, as follows:	721

(1) TwentyTwenty-five thousand dollars because of bodily	722
injury to or death of one person in any one accident;	723

(2) FortyFifty thousand dollars because of bodily injury to	724
or death of two or more persons in any one accident;	725

(3) FifteenTwenty-five thousand dollars because of injury to	726
property of others in any one accident.	727

Section 2.  That existing sections 3901.21, 3937.30, 3937.31,	728
3937.32, 3937.33, 3937.34, 3937.35, 4509.01, 4509.20, 4509.41, and	729
4509.51 of the Revised Code are hereby repealed.	730

Section 3.  Sections 1 and 2 of this act shall take effect	731
nine months after the effective date of this act.	732