North Carolina § 20-309 - Financial responsibility prerequisite to registration; must be maintained throughout registration period.

§ 20-309. Financial responsibility prerequisite to registration; must be maintained throughout registration period.

No motor vehicle shall be registered in this State unless the owner at the time of registration provides proof of financial responsibility for the operation of such motor vehicle, as provided in this Article. The owner of each motor vehicle registered in this State shall maintain financial responsibility continuously throughout the period of registration. For purposes of this Article, the term "motor vehicle" includes mopeds, as that term is defined in G.S. 20-4.01. An owner of a commercial motor vehicle, as defined in G.S. 20-4.01(3d), shall have financial responsibility for the operation of the motor vehicle in an amount equal to that required for for-hire carriers transporting nonhazardous property in interstate or foreign commerce in 49 C.F.R. § 387.9. Notwithstanding any other provision of this Chapter, an owner's policy of liability insurance issued to a foster parent or parents, which policy includes an endorsement excluding coverage for one or more foster children residing in the foster parent's or parents' household, may be certified as proof of financial responsibility, provided that each foster child for whom coverage is excluded is insured in an amount equal to or greater than the minimum limits required by G.S. 20-279.21 under some other owner's policy of liability insurance or a named nonowner's policy of liability insurance. The North Carolina Rate Bureau shall establish, with the approval of the Commissioner of Insurance, a named driver exclusion endorsement or endorsements for foster children as described herein. Financial responsibility shall be a liability insurance policy or a financial security bond or a financial security deposit or by qualification as a self-insurer, as these terms are defined and described in Article 9A, Chapter 20 of the General Statutes of North Carolina, as amended. When it is certified that financial responsibility is a liability insurance policy, the Commissioner of Motor Vehicles may require that the owner produce records to prove the fact of such insurance, and failure to produce such records shall be prima facie evidence that no financial responsibility exists with regard to the vehicle concerned. It shall be the duty of insurance companies, upon request of the Division, to verify the accuracy of any owner's certification. The proof of insurance required to demonstrate financial responsibility under subsection (c) of this section may be satisfied by producing records of insurance in either physical or electronic format. Acceptable electronic formats include display of electronic images on a mobile phone or other portable electronic device produced through an application or Web site of the insurer. When liability insurance with regard to any motor vehicle is terminated by cancellation or failure to renew, or the owner's financial responsibility for the operation of any motor vehicle is otherwise terminated, the owner shall forthwith surrender the registration certificate and plates of the vehicle to the Division of Motor Vehicles unless financial responsibility is maintained in some other manner in compliance with this Article. Repealed by Session Laws 2006-213, s. 5, effective July 1, 2008, and applicable to lapses occurring on or after that date. The Commissioner shall administer and enforce the provisions of this Article and may make rules and regulations necessary for its administration and shall provide for hearings upon request of persons aggrieved by orders or acts of the Commissioner under the provisions of this Article. Repealed by Session Laws 2007-484, s. 7(a), effective July 1, 2008, and applicable to lapses occurring on or after that date. Recodified as G.S. 20-311(g) by Session Laws 2007-484, s. 7(d), effective July 1, 2008, and applicable to lapses occurring on or after that date. History (1957, c. 1393, s. 1; 1959, c. 1277, s. 1; 1963, c. 964, s. 1; 1965, c. 272; c. 1136, ss. 1, 2; 1967, c. 822, ss. 1, 2; c. 857, ss. 1, 2; 1971, c. 477, ss. 1, 2; c. 924; 1975, c. 302; c. 348, ss. 1-3; c. 716, s. 5; 1979, 2nd Sess., c. 1279, s. 1; 1981, c. 690, s. 25; 1983, c. 761, s. 146; 1983 (Reg. Sess., 1984), c. 1069, ss. 1, 2; 1985, c. 666, s. 84; 1991, c. 402, s. 1; 1999-330, s. 4; 1999-452, s. 20; 2000-140, s. 100(a); 2000-155, s. 20; 2005-276, s. 6.37(p); 2006-213, s. 5; 2006-264, s. 38; 2007-484, ss. 7(a), (d); 2009-550, s. 4; 2015-125, s. 3; 2015-135, s. 4.3; 2015-146, s. 4.) Cross References. - As to Motor Vehicle Safety and Financial Responsibility Act of 1953, see G.S. 20-279.1 to 20-279.39. Editor's Note. - Session Laws 2005-276, s. 6.37(w), provides: "The Office of State Budget and Management shall develop a methodology for computing the actual costs of collection of civil penalties by State departments and agencies. This methodology shall apply to all State departments and agencies, effective July 1, 2006." Session Laws 2005-276, s. 1.2, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2005.'" Session Laws 2005-276, s. 46.3, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2005-2007 fiscal biennium, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2005-2007 fiscal biennium." Session Laws 2005-276, s. 46.5, is a severability clause. Session Laws 2015-125, s. 10, made the amendment to subsection (a) of this section by Session Laws 2015-125, s. 3, applicable to offenses committed on or after July 1, 2016. Session Laws 2015-135, s. 1.1, provides: "This act shall be known and may be cited as the 'Foster Care Family Act.' " Effect of Amendments. - Session Laws 2005-276, s. 6.37(p), effective July 1, 2005, added subsection (g). Session Laws 2006-213, s. 5, effective July 1, 2008, and applicable to lapses occurring on or after that date, repealed subsection (e). Session Laws 2006-264, s. 38, effective August 27, 2006, added subsection (h). Session Laws 2009-550, s. 4, effective August 28, 2009, substituted "provide proof of financial" for "has financial" in subsection (a). Session Laws 2015-125, s. 3, effective July 1, 2016, added the present last sentence in subsection (a). Session Laws 2015-135, s. 4.3, effective October 1, 2015, added subsection (a2). Session Laws 2015-146, s. 4, effective July 13, 2015, added subsection (c1). Legal Periodicals. - For case law survey on insurance, see 41 N.C.L. Rev. 484 (1963). For note on the State's inability to suspend the driver's license of a bankrupt who fails to satisfy an accident judgment debt, see 50 N.C.L. Rev. 350 (1972). For 1984 survey, "Employee Exclusion Clauses in Automobile Liability Insurance Policies," see 63 N.C.L. Rev. 1228 (1985). For note as to terminating an insurance policy according to North Carolina's financial responsibility legislation, in light of Peerless Ins. Co. v. Freeman, 78 N.C. App. 774, 338 S.E.2d 570, aff'd per curiam, 317 N.C. 145 , 343 S.E.2d 539 (1986), see 65 N.C.L. Rev. 1409 (1987). For note, "Sutton v. Aetna Casualty & Surety Co.: The North Carolina Supreme Court Approves Stacking of Underinsured Motorist Coverage - Will Uninsured Coverage Follow?," see 68 N.C. L. Rev. 1281 (1990).