Colorado § 42-7-301 - Security and proof of financial responsibility for the future required under certain circumstances.

§ 42-7-301. Security and proof of financial responsibility for the future required under certain circumstances.

(1) Unless exempt under section 42-7-302, an operator or owner named in a crash report required to be filed pursuant to section 42-4-1606 shall file with the director, according to the procedure provided by this section, both:

(a) Security, in an amount specified after consideration of the crash report and written substantiation of such report as provided in subsection (3)(b) of this section, which is sufficient to satisfy any judgments for damages or injuries resulting from the crash as may be recovered against such operator or owner but which in no event may exceed the sum of thirty-five thousand dollars; and

(b) Proof of financial responsibility for the future.

(2) Based upon a report filed pursuant to section 42-4-1606, the director shall determine whether an operator or owner is required to comply with the provisions of this article 7 and, if so, shall:

(a) Within fifteen days after receipt of the crash report, inform each such operator and each such owner of such requirement and that the operator or owner's license or nonresident's operating privilege will be suspended if the operator or owner fails to comply with the provisions of this article 7;

(b) Within sixty days after receipt of the crash report, send written notice of the requirement of filing security and proof of financial responsibility for the future to each such owner and each such operator at his or her last-known address, by first-class mail pursuant to section 42-2-119 (2).

(3) The notice specified in paragraph (b) of subsection (2) of this section shall state that:

(a) The license or nonresident's operating privilege of the person so notified is subject to suspension and shall be suspended unless such person, within twenty days after the mailing of such notice by the director, establishes that the requirements of this section are not applicable to such person or that such person previously filed or then files both security and proof of financial responsibility for the future as provided in paragraphs (a) and (b) of subsection (1) of this section.

(b) Any person having a claim for property damage or personal injury may be required by the director to substantiate such claim by written statement sworn to by a person experienced in estimating the cost of repairing the property damaged and a written report as to the personal injury sworn to by a licensed physician.

(c) The person notified is entitled to a hearing and judicial review as provided in section 42-7-201.

(d) The date on which such person's license or nonresident's operating privilege would otherwise be suspended shall be postponed during the pendency of such hearing if the request for a hearing is made within twenty days after the mailing of said notice and if the person files security and evidence of current liability insurance in the respondent's name.

(4) Upon expiration of such twenty-day period without a request for hearing or compliance with the contents of the notice as specified in subsection (3) of this section, such person's license or nonresident's operating privilege shall be suspended unless and until such person files security and proof of financial responsibility for the future as provided in paragraphs (a) and (b) of subsection (1) of this section.

(5) When no crash report is filed or when erroneous or incomplete information is given, the director, with regard to the matters set forth in this article 7, shall, after receipt of correct information with respect to said matters, take whatever appropriate action is indicated, consistent with the provisions of this article 7.

(6) No policy or bond is effective under this section unless issued by an insurance company or surety company authorized to do business in this state, but the surety requirements of this section may be satisfied by evidence of a savings account, deposit, or certificate of deposit meeting the requirements of section 11-35-101. However, if a motor vehicle was not registered in this state, or if a motor vehicle was registered elsewhere than in this state at the effective date of the policy or bond, or the most recent renewal thereof, such policy or bond will not be effective under this section unless the insurance company or surety company, if not authorized to do business in this state, executes a power of attorney authorizing the director to accept, on its behalf, service of notice or process in any action upon such policy or bond arising out of such crash.

(7) (a) (I) The security required pursuant to paragraph (a) of subsection (1) of this section may, in whole or in part, take the form of a contract between a person having a claim for property damage or personal injury and the operator or owner. Any such contract shall require notice by first-class mail to any obligor in default at the obligor's last-known address and allowing at least a ten-day period after mailing for the obligor to cure the default before remedies become available.

(II) The director shall prescribe the form of any contract authorized by subparagraph (I) of this paragraph (a).

(b) The director shall immediately suspend the license of a person obligated under a contract used as security pursuant to paragraph (a) of this subsection (7), upon receipt of evidence from the creditor in the form of an affidavit that:

(I) The obligor has defaulted on any payment obligation under the contract;

(II) Notice of the default has been sent to the obligor by certified mail; and

(III) The obligor has failed to cure the default within fifteen days after the date of mailing of the notice.

Source: L. 94: Entire title amended with relocations, p. 2476, § 1, effective January 1, 1995. L. 95: (3)(d) amended, p. 961, § 22, effective May 25; (7) added, p. 1215, § 2, effective July 1. L. 96: IP(1), IP(2), and (3)(d) amended, p. 1210, § 6, effective July 1. L. 2004: IP(1) amended, p. 464, § 4, effective August 4. L. 2026: IP(1), (1)(a), (2), (5), and (6) amended, (HB 26-1237), ch. 117, p. 489, § 77, effective August 12.

ANNOTATION

Section held constitutional. See In re Questions Submitted by United States Dist. Court, 179 Colo. 270, 499 P.2d 1169 (1972).

There is no requirement that the order of suspension be sent to the licensed driver or be received by him. People v. Neal, 191 Colo. 302, 552 P.2d 508 (1976).

When the motor vehicle department undertook to mail to appellee the order of suspension, it was a wholly gratuitous action, and failure to prove that appellee received the superfluous mailing which is not required by law was not fatal to the prosecution of the offense of driving an automobile while her license was under suspension. People v. Neal, 191 Colo. 302, 552 P.2d 508 (1976).

Sufficient notice. Where appellee was involved in an automobile accident on or about August 16, 1973, and on November 20, 1973, she acknowledged receipt of a notice dated November 14, 1973, wherein she was informed that failure upon her part to comply with at least one of several alternatives within 20 days "will cause suspension of your driver's license", this notice comported with the provisions of this section. People v. Neal, 191 Colo. 302, 552 P.2d 508 (1976).

Burden on motorist to show no possibility of judgment be rendered. It was legislative intent to place burden upon uninsured motorist of showing that there is not a reasonable possibility of judgment being rendered against him and that therefore provisions of section are not applicable to him. In re Questions Submitted by United States Dist. Court, 179 Colo. 270, 499 P.2d 1169 (1972).

Posting of security or suspension of driving privileges is required only when there is reasonable possibility of judgment being rendered against person involved. In re Questions Submitted by United States Dist. Court, 179 Colo. 270, 499 P.2d 1169 (1972); Sandoval v. Heckers, 350 F. Supp. 127 (D. Colo. 1972).

Applied in Rael v. Motor Vehicle Div., 42 Colo. App. 66, 589 P.2d 515 (1979).