Colo. House Passes Salvage Vehicle Bill

The Colorado House passed a bill last week requiring the state to issue a title clearly stating that a salvaged vehicle was “rebuilt from salvage.”

National Association of Independent Insurers (NAII) Northwest Regional Manager Michael Harrold said the amendment added to House Bill 1189 providing for the new title was a major improvement over the original bill. He said NAII has advocated such a provision for some time.

“The initial version of HB 1189, requiring a new salvage VIN number to be placed on rebuilt cars, would have been costly to implement as well as increase the incidence of auto thefts,” Harrold said. As law enforcement officials testified, tearing off VIN numbers and creating new ones would have led to a process that was vulnerable to the counterfeiting of VIN numbers, thus making it easier to traffic in stolen vehicles, according to Harrold.

In other action during the week, the Senate Business, Finance and Labor Committee amended HB 1136, which extends the sunset of the state Division of Insurance, to also extend the state no-fault insurance law for two years and to require the prior approval by the insurance commissioner before insurance rates can be changed. Another amendment would require insurers to report to the Insurance Division whenever a bad faith claim is filed against the company. An amendment to establish a separate insurance consumer counsel was defeated.

Harrold said the controversial amendments added to HB 1136 certainly jeopardizes the extension of the Division of Insurance as the session nears its adjournment date of May 9. Harrold noted, however, that even if the Division of Insurance technically were to sunset this year, Colorado law provides for a year’s winding down period. There is little doubt that the legislature then would extend the sunset of the Division of Insurance when it reconvened in 2003.

Earlier in the week, the House (April 22) defeated HB 1398, which would have placed limits on civil actions in construction defect cases. The bill would have prohibited the award of damages for non-economic loss or injury in civil cases and would not have allowed civil actions to be filed against contractors under the state’s Consumer Protection Act, which provides treble damages.

NAII testified in favor of HB 1398 in committee, arguing that the availability of treble damages has created a severe insurance affordability and availability crisis in Colorado. Harrold said the legislation was needed to avoid a severe problem for Colorado contractors and, ultimately, homeowners.

Topics Auto Colorado