HF 2215

as introduced - 94th Legislature (2025 - 2026) Posted on 03/12/2025 11:39am

A bill for an act
relating to commerce; requiring the commissioner of commerce to create a low-cost
motor vehicle insurance program for low-income residents; requiring a report;
appropriating money; amending Minnesota Statutes 2024, section 65B.49, by
adding a subdivision; proposing coding for new law in Minnesota Statutes, chapters
65B; 297I.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [65B.121] MINNESOTA LIFELINE INSURANCE PROGRAM.
new text end

new text begin Subdivision 1. new text end

new text begin Definitions. new text end

new text begin (a) For the purposes of this section, the following terms have
the meanings given.
new text end

new text begin (b) "Commissioner" means the commissioner of commerce or the commissioner's
representative.
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new text begin (c) "Eligible applicant" means an individual who meets the requirements of subdivision
6 and has applied for a lifeline policy under the program.
new text end

new text begin (d) "Facility" has the meaning given in section 65B.02, subdivision 3.
new text end

new text begin (e) "Insured" means a driver insured under the program.
new text end

new text begin (f) "Lifeline policy" or "policy" means a motor vehicle insurance policy issued in
compliance with subdivision 5.
new text end

new text begin (g) "Member" has the meaning given in section 65B.02, subdivision 4.
new text end

new text begin (h) "Minnesota lifeline insurance program" or "program" means the program created
under this section.
new text end

new text begin (i) "Motor vehicle" has the meaning given in section 169.011, subdivision 42.
new text end

new text begin (j) "Moving violation" means a violation of a law or municipal ordinance regulating the
operation of motor vehicles on streets or highways. Moving violation does not include a
law or ordinance related to parking or motor vehicle equipment.
new text end

new text begin (k) "Primary online producer" means the producer of record for a policy sold through
the website described in subdivision 3, paragraph (g).
new text end

new text begin (l) "Qualified health coverage" means medical assistance, MinnesotaCare, Medicare,
general assistance medical care, TRICARE, or other medical insurance that covers
hospitalization and emergency services.
new text end

new text begin Subd. 2. new text end

new text begin Commissioner duties. new text end

new text begin (a) The commissioner must consult with the facility to
develop and operate the program. The program must be developed and operated by the
facility as described in subdivision 3.
new text end

new text begin (b) By March 1 of each year, the commissioner must present the report issued by the
facility under subdivision 3 to the chairs and ranking minority members of the legislative
committees with jurisdiction over motor vehicle insurance. The commissioner must also
provide a description of marketing and outreach efforts and the commissioner's expenditures
related to the program, including expenditures from the Minnesota lifeline insurance program
account under section 297I.12. The commissioner may recommend modifications to this
section and present any other information that the commissioner determines would enhance
the legislature's understanding of the program and the program's participants.
new text end

new text begin Subd. 3. new text end

new text begin Facility duties. new text end

new text begin (a) The facility must:
new text end

new text begin (1) develop and operate the program in consultation with the commissioner;
new text end

new text begin (2) determine whether an applicant is eligible for the program; and
new text end

new text begin (3) sell, issue, and deliver lifeline policies under the program.
new text end

new text begin (b) The facility must determine the rates charged for lifeline policies and file rates with
the commissioner, in compliance with section 65B.08. Prior to determining the rates, the
facility must conduct a meeting to provide an opportunity for public comment on the proposed
rates and the rate setting process.
new text end

new text begin (c) The facility must set rates for the program in an amount adequate to pay for losses
incurred for claims filed under the program and program expenses related to selling and
servicing policies, including:
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new text begin (1) underwriting;
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new text begin (2) producer commissions;
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new text begin (3) claims adjusting;
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new text begin (4) subrogation;
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new text begin (5) taxes, licenses, and fees; and
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new text begin (6) other administrative and overhead expenses specifically associated with the servicing
of lifeline policies.
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new text begin The rates must also account for investment income.
new text end

new text begin (d) To determine rates, the facility must rely on:
new text end

new text begin (1) loss data associated with policies sold by the facility under the lifeline program,
when program loss data is available; and
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new text begin (2) private passenger automobile insurance loss data in Minnesota, adjusted to reflect
the eligibility factors described in subdivision 6. Private passenger automobile insurance
loss data must be used only to the extent that program data are not available or in conjunction
with program data in order to meet actuarial standards of credibility.
new text end

new text begin (e) The rates may include the cost to offer, at no additional cost to insureds, a deferred
payment plan designed by the facility that allows an insured to pay the insured's premium
in no fewer than six installments.
new text end

new text begin (f) The facility, in consultation with the commissioner, may establish up to three
geographic regions of the state and set different premiums by region to reflect different loss
costs associated with each region, except that the premium charged in a region must not be
more than 25 percent higher than an otherwise similar policy in another region of the state.
new text end

new text begin (g) The facility, in consultation with the commissioner, must create and maintain a
website for the program that includes the information necessary for an eligible applicant to
apply for the program. The website must initially include sufficient functionality to provide
prospective applicants with information about the program, the lifeline policy, the premium
the applicant would be charged, and contact information for licensed producers that sell the
lifeline policy. The website must add functionality necessary to allow a policy to be sold
online, to the extent possible, in accordance with the following timeline:
new text end

new text begin (1) within one year of enactment of the program, the facility must solicit bids and award
a contract to a producer licensed to sell insurance in the state, including a policy under this
section, to become the primary online producer; and
new text end

new text begin (2) the facility must work with the primary online producer to increase the functionality
of the website in order to allow a prospective lifeline policyholder to apply online no later
than one year after the effective date of the facility's contract with the primary online
producer.
new text end

new text begin (h) The primary online producer must earn a commission associated with a policy
produced online and has the same responsibilities to the policyholder as a producer that
sells a policy without the assistance of the website.
new text end

new text begin (i) The facility may accept funding from sources other than members to support the
program's marketing, outreach, and public education efforts.
new text end

new text begin (j) Money for marketing, outreach, and public education must be awarded equitably
among geographic regions, taking into consideration a region's target population and
marketing goals.
new text end

new text begin (k) The facility must develop a process for applicants to demonstrate program eligibility
under subdivision 6 that minimizes the burden on the applicant and barriers to participation
in the program.
new text end

new text begin (l) The facility may require policy holders to recertify eligibility for the program with
regard to residency, income, and qualified health coverage at intervals no shorter than three
years.
new text end

new text begin (m) By February 1 of each year, the facility must issue a report to the commissioner that
presents information regarding the implementation and operation of the program and
participation in the program. The report must include:
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new text begin (1) the total number of applications received by the facility during the prior year;
new text end

new text begin (2) the total number of policies issued by the facility during the prior year;
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new text begin (3) the total number of policies rejected by the facility during the prior year;
new text end

new text begin (4) the total number of policies in force on March 31, June 30, September 30, and
December 31 of the prior year;
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new text begin (5) information indicating the geographic distribution of policies throughout the state;
new text end

new text begin (6) the total premium collected during the prior year;
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new text begin (7) the estimate of incurred losses for the prior year or the most recent 12-month period
for which data are available;
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new text begin (8) a summary of the disputed issues regarding a rate change submitted to the
commissioner by the facility in the event that the rate change was not adopted unanimously
by the facility's governing committee;
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new text begin (9) any modifications to this section that the facility recommends; and
new text end

new text begin (10) any other information that the facility determines would enhance the legislature's
understanding of the program and the program's participants.
new text end

new text begin Subd. 4. new text end

new text begin Producer duties. new text end

new text begin (a) A licensed producer must provide to an applicant for a
lifeline policy the following information in no smaller than 14-point type on a form prescribed
by the commissioner:
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new text begin (1) notice that a lifeline policy under this section satisfies the requirements under section
65B.48 to maintain automobile liability insurance;
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new text begin (2) premium cost;
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new text begin (3) how eligibility is determined; and
new text end

new text begin (4) the difference between the coverage available under a lifeline policy and the minimum
coverage requirements that apply to policies sold outside of the program and in compliance
with section 65B.48.
new text end

new text begin (b) A licensed producer is entitled to receive a commission on each lifeline policy sold
that is equal to 12 percent of the policy premiums, provided that the commission is not less
than $50. The facility or any insurance company issuing a lifeline policy under this section
is prohibited from requiring a producer to return any portion of the commission paid for the
sale of a lifeline policy if the insured, facility, or issuing carrier cancels the policy before
the end of the policy term.
new text end

new text begin (c) A licensed producer that complies with the disclosure requirements of this subdivision
in conjunction with the sale of a lifeline policy is not liable for selling a policy that does
not provide the coverage required in section 65B.49.
new text end

new text begin (d) A licensed producer must accept payment for premiums under the program by cash
and by all other methods approved by the facility.
new text end

new text begin (e) Payment of premiums for a lifeline policy through an insurance premium finance
agreement, as defined under section 59A.02, is prohibited.
new text end

new text begin Subd. 5. new text end

new text begin Lifeline policies. new text end

new text begin The program must include and the facility must offer a lifeline
policy, with a length of six or 12 months, that includes:
new text end

new text begin (1) basic economic loss benefits that provide a minimum of $5,000 for income loss,
replacement services loss, funeral expense loss, survivor's economic loss, and survivor's
replacement services loss arising out of the injury to any one person;
new text end

new text begin (2) the payment of claims for bodily injury or death arising from an accident of $30,000
for any one person and $60,000 for any two or more persons, in addition to interest and
costs;
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new text begin (3) the payment of claims for property of others damaged or destroyed in an accident
of $10,000, in addition to interest and costs; and
new text end

new text begin (4) uninsured and underinsured motorist coverage with limits of $25,000 because of
injury to or the death of one person in any accident and $50,000 because of injury to or the
death of two or more persons in any accident.
new text end

new text begin Subd. 6. new text end

new text begin Eligible applicant. new text end

new text begin (a) An eligible applicant must:
new text end

new text begin (1) be a resident of Minnesota;
new text end

new text begin (2) have a household adjusted gross income that is no more than 300 percent of the
federal poverty level at the time the policy is issued or reissued;
new text end

new text begin (3) demonstrate that all household members are enrolled in qualified health coverage;
and
new text end

new text begin (4) have been continuously licensed as a driver for the three years immediately preceding
application, except that a license suspension or revocation does not constitute a break in
continuous licensure for the purposes of satisfying this requirement if the revocation or
suspension was due to any of the following:
new text end

new text begin (i) a conviction for a violation under section 169.791, 169.797, or 171.24, subdivision
1 or 2;
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new text begin (ii) a violation of section 171.18, subdivision 1, paragraph (a), clause (1), for being cited
for a violation of section 169.791 or 169.797;
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new text begin (iii) failure to appear in court under section 171.16, subdivision 3a, for a petty
misdemeanor; or
new text end

new text begin (iv) failure to pay a fine under section 171.16, subdivision 3.
new text end

new text begin (b) A policy may be issued to an eligible applicant who has had continuous licensure
for less than three years. The facility, in consultation with the commissioner, may establish
different premiums for an insured with less than three years' continuous licensure to reflect
different loss costs associated with insureds with less that three years' continuous licensure,
except that the premium charged must not be more than 25 percent higher than the premium
charged to an insured with three years of continuous licensure in the same region of the
state.
new text end

new text begin (c) An eligible applicant must not, within the three years immediately preceding
application, be:
new text end

new text begin (1) at fault in a motor vehicle accident involving bodily injury or death;
new text end

new text begin (2) convicted of a misdemeanor, gross misdemeanor, or felony for a violation arising
out of the use of a motor vehicle other than for a violation of section 171.24, subdivisions
1 or 2; 169.791; or 169.797;
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new text begin (3) convicted of a violation of section 84.765; 84.795, subdivision 5; 86B.33; or a
Minnesota statute or a statute in another state that is equivalent to the sections identified in
this clause;
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new text begin (4) convicted of more than two moving violations; or
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new text begin (5) at fault in more than one motor vehicle accident that involved only damage to property.
new text end

new text begin (d) If an applicant is rejected by the facility, the facility must allow the applicant to cure
the deficiency and must accept the cured application if the applicant is otherwise eligible
for the program.
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new text begin (e) An enrollee may be required to provide proof of qualified health insurance.
new text end

new text begin (f) A lifeline policy may be nonrenewed if the insured no longer meets the requirements
under this subdivision.
new text end

Sec. 2.

Minnesota Statutes 2024, section 65B.49, is amended by adding a subdivision to
read:

new text begin Subd. 11. new text end

new text begin Minnesota lifeline automobile insurance program. new text end

new text begin Notwithstanding this
section or any law to the contrary, a policy issued pursuant to the Minnesota lifeline
automobile insurance program under section 65B.121, meets the requirements of this section.
new text end

Sec. 3.

new text begin [297I.12] LIFELINE PROGRAM MARKETING AND OUTREACH FUND.
new text end

new text begin Subdivision 1. new text end

new text begin Surcharge. new text end

new text begin (a) Each insurer engaged in writing policies of automobile
insurance must collect a surcharge, at the rate of 10 cents per vehicle for every six months
of coverage, on each policy of automobile insurance providing comprehensive insurance
coverage issued or renewed in Minnesota. The surcharge is not considered premium for
any purpose, including the computation of premium tax or agents' commissions. The amount
of the surcharge must be separately stated on either a billing or policy declaration sent to
an insured. An insurer must remit the revenue derived from the surcharge under this
subdivision to the commissioner of revenue for marketing and outreach for the Minnesota
lifeline insurance program under section 65B.121.
new text end

new text begin (b) For purposes of this subdivision, "policy of automobile insurance" has the meaning
given in section 65B.14, and covers only the following types of vehicles, as defined in
section 168.002, if the vehicle's gross vehicle weight does not exceed 10,000 pounds:
new text end

new text begin (1) a passenger automobile;
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new text begin (2) a pickup truck;
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new text begin (3) a van, but not commuter vans as defined in section 168.126; or
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new text begin (4) a motorcycle.
new text end

new text begin Subd. 2. new text end

new text begin Minnesota lifeline insurance program account. new text end

new text begin The Minnesota lifeline
insurance program account is created in the special revenue fund. The proceeds of surcharges
imposed under subdivision 1 must be deposited in the Minnesota lifeline insurance program
account. Money in the account is appropriated to the commissioner for marketing and
outreach activities to promote enrollment in the Minnesota lifeline insurance program
described under section 65B.121. Allowable uses include but are not limited to:
new text end

new text begin (1) grants to nonprofit organizations that provide direct services to individuals likely to
benefit from information about the lifeline insurance program; and
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new text begin (2) a contract with a marketing company with demonstrated success in public relations
to populations likely to benefit from information about the lifeline insurance program.
new text end

Sec. 4. new text begin APPROPRIATION; MINNESOTA LIFELINE AUTOMOBILE INSURANCE
PROGRAM.
new text end

new text begin (a) $....... in fiscal year 2026 is appropriated from the general fund to the commissioner
of commerce to establish the Minnesota lifeline automobile insurance program.
new text end

new text begin (b) $20,000 in fiscal year 2026 and $20,000 in fiscal year 2027 are appropriated from
the general fund to the commissioner of commerce to retain an independent actuary to
provide actuarial consulting services to the public members of the facility.
new text end