Pohnpei legislators mulling mandatory vehicle insurance bill

Pohnpei legislators mulling mandatory vehicle insurance bill

By Bill Jaynes

The Kaselehlie Press

August 30, 2018

Pohnpei—The Pohnpei State Legislature is considering a bill (LB 355-18) to require all vehicles to have a minimum of $15,000 of Property Damage Liability Insurance and the same amount for Third Party Bodily Injury Liability before a vehicle can be registered.

The Justice and Governmental Operations Committee has already conducted at least one public hearing on the bill but a committee report has not yet been introduced.

“The Legislature finds that motor vehicle insurance is necessary to assure that injured Pohnpeians receive adequate compensation when they are injured in their person or their property. It is the intent of this legislation to require mandatory motor vehicle liability insurance in order to guarantee adequate protection for victims of car accidents who are injured in Pohnpei or who are injured while riding in motor vehicles which are operated in Pohnpei,” the bill says.

If the bill passes it would go into effect on January 1, 2019.

Certification of insurance would be required before a vehicle could be registered. The insurance must be in effect for the entire year of registration unless the vehicle is sold or otherwise transferred, at which time the new owner would be required to have insurance before it can be re-registered.

If the vehicle owner lies about having insurance, the Director of the Department of Public Safety would have the power to revoke a registration. If that action is taken, that vehicle would not be eligible for registration for six months. If a person’s registration certificate is revoked, the registration certificate cannot be transferred in any other name unless the Director is satisfied that the transfer was made in good faith and not for purposes of defeating the purposes of the law.

The Department of Public Safety would be authorized to immobilize any vehicle that has a revoked registration certificate.

The bill, in its current form would require insurers to notify the Department of Public Safety of any insurance cancellations or lapses. The Director would then inform the insured that insurance for the vehicle has been cancelled. The insured would then have 30 days to procure a new policy or re-instate a policy. If that is not done within the imposed time limit, the owner of the vehicle would be fined $500 and the vehicle will be subject to impoundment.