17:33B-41 Cancellation for nonpayment of premium; suspension of registration.

50. a. Upon the termination of a policy of motor vehicle liability insurance by cancellation for nonpayment of premium pursuant to section 2 of P.L.1968, c.158 (C.17:29C-7), notice of that cancellation shall be filed by the insurer with the Division of Motor Vehicles not later than 30 days following the effective date of that cancellation.

b. The division shall notify the person whose policy was canceled that, unless proof of motor vehicle liability insurance is filed with the division within 30 days of the notification or some other allowable circumstance exists and the division is notified of that circumstance within 30 days of the notification, the sanctions and penalties of this section shall apply.

c. If the Director of the Division of Motor Vehicles has not received proof of motor vehicle liability insurance or other allowable circumstances within 30 days pursuant to subsection b. of this section, he shall suspend the registration of such vehicle, except that:

(1) Suspension shall not be made under this subsection upon the basis of a cancellation of motor vehicle liability insurance if the registration certificate and registration plates of the motor vehicle are surrendered prior to the time at which the cancellation of insurance becomes effective. Such surrender shall be made to such officers of the division as the director shall direct. For the purposes of this paragraph, the expiration of a registration without renewal of that registration shall be deemed to be a surrender of registration as of the date of expiration;

(2) Suspension shall not be made under this subsection upon a cancellation of motor vehicle liability insurance if the vehicle has been, or will be, prior to the date of that cancellation, removed from the United States in North America and the Dominion of Canada for the purpose of international traffic, provided that the owner of the vehicle, prior to the date of that cancellation, has filed with the director a statement, in a form prescribed by him, indicating that the vehicle has been, or will be, so removed, and agreeing to notify the director immediately upon return of the vehicle to the United States in North America or the Dominion of Canada. Upon receipt of the statement the director shall restrict the use of the registration to such international traffic until new proof that motor vehicle liability insurance has been secured for the vehicle;

(3) Suspension need not be made under this subsection upon the basis of a cancellation of motor vehicle liability insurance if the period of time during which the motor vehicle remained both registered and uninsured was not greater than 15 days. The director shall promulgate regulations governing the conditions under which suspension action may be withheld pursuant to this paragraph.

d. Notwithstanding the provisions of subsection c. of this section, an order of suspension may be rescinded if the registrant pays to the commissioner a civil penalty in the amount of $4 for each day up to 90 days for which motor vehicle liability insurance was not in effect. The provisions of this subsection shall apply only once during any 36-month period and only if the registrant surrenders the certificate of registration and registration plates to the director not more than 90 days from the date of cancellation of motor vehicle liability insurance coverage or submits to the director proof of motor vehicle liability insurance which took effect not more than 90 days from the cancellation of his previous motor vehicle liability insurance.

e. Any motor vehicle, the registration for which has been suspended pursuant to this section, shall not be registered or reregistered in the name of the same registrant, or in any other name where the director has reasonable grounds to believe that such registration or reregistration will have the effect of defeating the purposes of this section, and no other motor vehicle shall be registered in the name of such person during the period of suspension.

f. No registration plates shall be returned to the registrant until proof of motor vehicle liability insurance is submitted to the director.

g. If a registrant has not surrendered his certificate of registration and registration plates or obtained motor vehicle liability insurance within 90 days from the date of cancellation of motor vehicle liability insurance, the director shall suspend the driver's license of any such registrant. The suspension shall take effect on the date specified in the order and shall remain in effect until termination of the suspension of the registrant's registration.

h. The Director of the Division of Motor Vehicles shall adopt rules and regulations pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), to implement the provisions of this section. The director may, by regulation, require that the provisions of this section shall be applicable to the termination of policies of motor vehicle liability insurance for reasons other than cancellation for nonpayment of premium, including nonrenewals.

i. Within 180 days of the effective date of this act the Division of Motor Vehicles shall develop a format for electronic reporting by insurers writing private passenger automobile insurance, to the division, on a real-time basis, information regarding the cancellation of policies of motor vehicle insurance, the issuance of new policies of motor vehicle insurance, and changes of vehicle on policies of motor vehicle insurance in force in order to verify compliance with the motor vehicle liability insurance requirements of section 1 of P.L.1972, c.197 (C.39:6B-1), and the mandatory automobile insurance requirements of section 4 of P.L.1998, c.21 (C.39:6A-3.1). Information shall be maintained by driver's license number of the named insured. Other information to be provided by insurers shall be established by the director by regulation.

j. The director shall establish an electronic data base containing the information provided for in subsection i. of this section, which shall be made available to all law enforcement officers for the purpose of enforcing the mandatory motor vehicle insurance requirements of section 1 of P.L.1972, c.197 (C.39:6B-1). The data base shall not be made available until every insurer writing private passenger insurance has complied with regulations of the director and the information required by subsection i. of this section is reported on a real-time basis. The Division of Motor Vehicles shall establish security procedures to protect the confidentiality of the information on the data base, which shall preclude access to the information to any person not otherwise entitled to it under this or any other law.

k. The data base shall be funded from the Uninsured Motorist Prevention Fund established pursuant to section 2 of P.L.1983, c.141 (C.39:6B-3).

L.1990,c.8,s.50; amended 1998, c.21, s.30; 1998, c.22, s.7.