HF 1406

as introduced - 94th Legislature (2025 - 2026) Posted on 02/24/2025 03:26pm

A bill for an act
relating to motor vehicles; providing notice requirements related to salvage vehicle
auctions; authorizing insurers to apply for vehicle title when vehicle is acquired
through payment of damages; proposing coding for new law in Minnesota Statutes,
chapter 168A.

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

Section 1.

new text begin [168A.1502] INSURER APPLICATION FOR TITLE.
new text end

new text begin (a) When an insurer licensed to conduct business in Minnesota acquires ownership of a
vehicle through payment of damages and the owner fails to deliver the vehicle's title to the
insurer within 15 days of payment of the claim, the insurer or a designated agent may apply
to the commissioner for a certificate of title, salvage title, or prior salvage title as provided
in this section. This section only applies to vehicles with a title issued by this state.
new text end

new text begin (b) At least 15 days prior to applying for a certificate of title, salvage title, or prior salvage
title under this section, the insurer or a designated agent must notify the owner and any
lienholders of record of the insurer's intent to apply for a title. The notice must be sent to
the last known address of the owner and any lienholders by certified mail or by a commercial
delivery service that provides evidence of delivery.
new text end

new text begin (c) At least 15 days after notifying the owner and any lienholders under paragraph (b),
the insurer may apply for a certificate of title, salvage title, or prior salvage title from the
commissioner. The application must attest that the insurer or a designated agent:
new text end

new text begin (1) paid the claim;
new text end

new text begin (2) requested the title or other necessary transfer documents from the owner; and
new text end

new text begin (3) provided notice to the owner and any lienholders as required under paragraph (b).
new text end

new text begin If the insurer or a designated agent does not attest to completing the requirements under
clauses (1) to (3), the commissioner must reject the application.
new text end

new text begin (d) Notwithstanding any outstanding liens, upon proper application, the commissioner
must issue a certificate of title, salvage title, or prior salvage title in the name of the insurer.
Issuance of a certificate of title, salvage title, or prior salvage title extinguishes all existing
liens against the vehicle. If the vehicle is sold, the insurer or a designated agent must assign
the title to the buyer, and the vehicle is transferred without any liens.
new text end

Sec. 2.

new text begin [168A.1503] REQUIREMENTS UPON UNPAID INSURANCE VEHICLE
CLAIM.
new text end

new text begin Subdivision 1. new text end

new text begin Definition. new text end

new text begin For purposes of this section, "salvage vehicle auction
company" or "auction company" means a business, organization, or individual that sells
salvage vehicles on behalf of insurers.
new text end

new text begin Subd. 2. new text end

new text begin Notice to auction company. new text end

new text begin (a) If an insurance company licensed to conduct
business in Minnesota requests an auction company to take possession of a salvage vehicle
that is subject to an insurance claim and the insurance company does not subsequently take
ownership of the vehicle, the insurance company may direct the auction company to release
the vehicle to the owner or lienholder.
new text end

new text begin (b) The insurance company must provide the auction company notice by commercial
delivery service, email, or a proprietary electronic system accessible by both the insurance
company and the auction company authorizing the auction company to release the vehicle
to the vehicle's owner or lienholder.
new text end

new text begin Subd. 3. new text end

new text begin Notice to owner or lienholder. new text end

new text begin (a) Upon receiving notice from an insurance
company, the auction company must send two notices a minimum of 14 days apart to the
owner of the vehicle and any lienholders stating that the vehicle is available to be recovered
from the auction company within 30 days of the date on which the first notice was sent.
Each notice must include an invoice for any outstanding charges owed to the auction company
that must be paid before the vehicle may be recovered.
new text end

new text begin (b) Notice under this subdivision must be sent to the address of the owner and any
lienholder on record with the department by certified mail or a commercially available
delivery service that provides proof of delivery.
new text end

new text begin Subd. 4. new text end

new text begin Vehicle deemed abandoned. new text end

new text begin (a) If the owner or any lienholder does not recover
the vehicle within 30 days of the date on which the first notice was sent under subdivision
3, (1) the vehicle is considered abandoned, (2) the vehicle's certificate of title is deemed
assigned to the auction company, and (3) without surrendering the certificate of title, the
auction company may request, on a form provided by the department, that the department
issue a certificate of title that is free of liens and bears a salvage or prior salvage brand.
new text end

new text begin (b) A request under paragraph (a) must be accompanied by a copy of (1) the notice sent
by the insurance company required under subdivision 2, and (2) evidence of delivery of the
notices sent to the owner and any lienholders required under subdivision 3 or evidence that
the notices were undeliverable.
new text end

new text begin (c) Notwithstanding any outstanding liens against the vehicle, upon receipt of any fees
charged under section 168A.29, the department must issue a certificate of title that is free
of liens and bears a salvage or prior salvage brand to the auction company in possession of
the vehicle.
new text end