OAI: Ariz. Auto Insurance Law in Effect, Spotlights Electronic Proof Laws

An Arizona auto insurance law allowing motorists to electronically prove they have the proper coverage to drive went into effect Thursday, highlighting similar measures across the U.S. that have in some cases enjoyed strong support from industry groups and legislators, according to Online Auto Insurance.

A handful of states have such regulations on the books, including Idaho, which was the first state to fully pass a law allowing electronic proof of coverage.

Arizona's path toward electronic proof was paved after Gov. Jan Brewer signed off on HB 2677 in late March. Under the law, electronic formats of policies or policy documents, which several major insurers provide to policyholders in formats they can display on their smartphones, can be presented to police during traffic stops as an acceptable form of proving coverage. The law also permits policyholders to scan their policy card or documents, upload them onto their mobile device and display those images to authorities as acceptable proof.

A similar law in Louisiana went into effect on Wednesday. Idaho's law went into effect the beginning of last month.

Regulations in Alabama and Colorado allow similar electronic evidence of coverage to be used during the car registration process; Alabama's regulation will go into effect in January 2013.

In California, legislators are debating AB 1708, which is scheduled for a committee hearing in the state Senate on Monday.

A vast majority of lawmakers have thrown their support behind such efforts, with the legislation in Louisiana, Idaho, California and Arizona all gathering unanimous support during their times in their respective legislatures.

In Louisiana, Idaho and Arizona, the electronic proof bills moved relatively quickly through the legislative process, never needing more than three months between introduction and final approval.

However, California's AB 1708 has seen a longer journey, undergoing six revisions since it was introduced in February. Lawmakers there have noted privacy issues over such legislation in an analysis issued in June.

In the analysis, the Senate Insurance Committee questioned what type of information could be accessed, and what could be done with it, by authorities while a driver's mobile device is in their possession.

"Practically speaking, this might mean that any person who hands their cell phone over to a peace officer voluntarily risks disclosure of private information accidentally revealed," the analysis stated.

Trade groups have cheered electronic forms of insurance coverage as the industry's next wave of modernization and electronic proof laws gain traction across the U.S.

"Paper cards are not always what consumers want," Kelly Campbell, vice president of Property Casualty Insurers Association of America (PCI), said in a statement following Brewer's finalization of the Arizona law. "More policyholders want a truly paperless policy."

For more on this and related issues, head to http://www.onlineautoinsurance.com/arizona/ for access to an easy-to-use quote-comparison generator and informative resource pages.