Vehicle owners would show insurance before certain registrations

The Department of Revenue and county clerks would stop processing certain registration applications until the vehicle owner provides accepted proof of financial security. This applies to initial registration and renewal after the department identifies evidence that the vehicle is uninsured and before it has sent the owner the required notice. Accepted proof may include an insurance policy and financial responsibility certificate stating that coverage will remain in force for at least 30 days. A first coverage failure would carry a $500 fee, and a continued failure would carry an additional $1,000 fee. A second or later notice within three years of the first notice would instead lead to a $1,500 repeated-failure fee, registration suspension or revocation, and required instructions for reinstatement. Sections 1 through 8 would take effect July 1, 2027.

A qualifying uninsured vehicle owner or operator would generally be unable to recover noneconomic damages, such as compensation for pain and suffering, in a covered lawsuit. The rule covers civil cases for bodily injury, property damage, or death involving a vehicle whose owner or operator did not meet the state’s financial-responsibility requirements at the time of the incident. If the plaintiff receives economic damages, the plaintiff would be responsible for all court costs incurred by every party. The limit would not apply when the defendant was convicted of or pleaded no contest to certain impaired-driving or reckless-driving offenses, intentionally caused the harm, left the crash scene, or was committing a felony. Passengers could still seek noneconomic damages unless they also owned the noncompliant vehicle. The rule would not remove an insurer’s subrogation rights for paid claims. The chapter would apply to civil actions filed on or after the act’s effective date, and the text states that this section would take effect when the act becomes law.

Insurers would provide their full customer records weekly, including more frequent reporting when available, while transportation officials could use interstate message signs to remind drivers about insurance requirements. The reporting rule concerns insurance information used for the state vehicle-insurance verification program. The message signs would address all vehicles operated on Tennessee public highways. The Department of Transportation would consult with the Departments of Safety and Revenue before using the signs. The department could set guidelines for message content, length, and frequency. The reporting changes would take effect July 1, 2027. The message-sign authority would take effect when the act becomes law.