What's the story on motor vehicle reports? This has been the number one question on the technical services hotline at IIAT in the last several months. Two major limitations are involved in the MVR situation. The first limitation is the Fair Credit Reporting Act (FCRA) that requires written authorizations if MVRs are going to be used for employment purposes. The legal staff at the Independent Insurance Agents & Brokers of America has prepared a memorandum explaining these laws' effect on MVR requests by agencies.
The second limitation is the contractual relationship between the MVR providers and the Department of Motor Vehicles in the various states and the contractual agreements between the MVR providers and your agency, which limit how reports can be obtained and used.
The following information on the dissemination of MVR information is intended to help clear up confusion surrounding these limitations.
Q. Can our agency still order MVRs ?
A. Yes, to determine insurability and to use the MVRs for underwriting purposes.
Q. If the agency orders an MVR to determine insurability, can we send it to the insurance carrier?
A. Yes, if it is still part of the underwriting purpose.
Q. Once we have ordered an MVR for underwriting purposes can we pass this information on to our commercial insured?
A. As long as your contract with the MVR provider does not prohibit such dissemination of information, you can pass this information on if you have complied with the Fair Credit Reporting Act.
Q. If we obtain an MVR for underwriting and an individual is not acceptable what can we tell our commercial insured?
A. Unless (1) your contract with your MVR provider permits the transfer of this information, (2) you have received the authorization required by the FCRA from the individual or the documentation from your insured that he/she has obtained authorization from the individual, prior to obtaining the MVR, and (3) you have complied with other aspects of the FCRA; you cannot release any information. You are only permitted to say that the account is being declined due to driving records. You cannot give names, you cannot give details.
Q. It sounds as though we should have the written authorization or documentation required by FCRA from all our commercial clients, is this true?
A. Yes, that would help if you need to advise an insured when your carrier has obtained an MVR for an unacceptable driver. When the carrier does obtain MVRs and you have the written authorization or documentation, and comply with all the other aspects of the FCRA, you will at least be able to give your customer the reason the account is being declined or the information on the particular driver that needs to be excluded. Again, you cannot pass this information on if you or your carrier are prohibited from doing so in the contract with the MVR provider.
Q. One of our carriers has advised us that we cannot give out any information?
A. Again, it may be because your carrier's MVR provider prohibits it in their contract or your company is concerned about their exposure for passing on this information without the agent having complied with the FCRA prior to the company ordering the MVR. Only your company can give you the reason for their decision.
Q. What contract provisions prohibit agents from releasing information when they do obtain the proper disclosures ?
A. MVR providers are concerned about the unauthorized dissemination of MVRs that may violate FCRA and subject the providers to certain civil penalties, resulting in their future inability to obtain MVRs. Contracts between MVR providers and agents may contain clauses such as "reports may not be resold or transferred to any other person."
Q. If we can find a provider that allows us to pass this information on or order directly from DPS what do we need to do to comply with FCRA?
A. You must comply with all the requirements of FCRA as outlined in IIABA's white paper.
Q. Our insured wants to order their own MVRs, can we provide them with information about what is acceptable for underwriting purposes?
A. Yes, you can ask your company what they will accept and decline regarding violations and provide that information to your insured. Many of your large commercial accounts probably are already pretty knowledgeable in this area.
A. Your insured, however, is still subject to FCRA and must comply with FCRA as required.
Q. What MVR providers can we refer our commercial clients to so they can set up their own accounts?
A. We have information on only three. They are Choicepoint; US Investigative Services and Insurance Information Exchange.
Q. How do we obtain driving record information from the Texas Department of Public Safety?
A. A licensed driver in Texas can request their own driver record online through the DPS website. This is one way to avoid the notification requirements: Help the driver order his own record and the agent or the employer can pay for it if necessary. .