H. B. 4153


(By Delegate Warner)
[Introduced January 25, 2000; referred to the
Committee on Banking and Insurance then Finance.]




A BILL to amend and reenact section ten, article four, chapter seventeen-a of the code of West Virginia, one thousand nine hundred thirty-one, as amended, relating to permitting an insurance claimant with a total loss which is exclusively cosmetic to choose to retain the vehicle by providing for the issuance of a title with the designation "cosmetic total loss".

Be it enacted by the Legislature of West Virginia:
That section ten, article four, chapter seventeen-a of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted to read as follows:
ARTICLE 4. TRANSFERS OF TITLE OR INTEREST.

 §17A-4-10. Salvage certificates for certain wrecked or damaged vehicles; fee; penalty.
(a) In the event a motor vehicle is determined to be a total loss or otherwise designated as "totaled" by any insurance company or insurer, and upon payment of an agreed price as a claim settlement to any insured or claimant owner for the purchase of the vehicle, the insurance company or the insurer shall receive the certificate of title and the vehicle except that an insured or claimant owner may choose to retain possession of a cosmetically damaged vehicle, as provided in subdivision (2) of this subsection. The term "total loss" means a motor vehicle which has sustained damages equivalent to seventy-five percent or more of the market value as determined by a nationally accepted used car value guide. The insurance company or insurer shall within ten days determine if the vehicle is repairable, cosmetically damaged or nonrepairable and surrender the certificate of title and a copy of the claim settlement to the division of motor vehicles. If the insurance company or insurer determines that the vehicle is repairable, the division shall issue a "salvage certificate", on a form prescribed by the commissioner, in the name of the insurance company or the insurer. Such The certificate shall contain on the reverse thereof spaces for one successive assignment before a new certificate at an additional fee is required.
(1) Upon the sale of the vehicle the insurance company or insurer shall endorse the assignment of ownership on the salvage certificate and deliver it to the purchaser. The vehicle shall not be titled or registered for operation on the streets or highways of this state unless there is compliance with subsection (c) of this section. In the event a motor vehicle is determined to be damaged in excess of seventy-five percent of its retail price as described in the national automobile dealers association official used car guide, a junk card will be issued in lieu of a salvage certificate. The division shall charge a fee of fifteen dollars for each salvage title issued.
(2) If the insurance company or insurer determines the damage to a totaled vehicle is exclusively cosmetic and no repair is necessary in order to legally and safely operate the motor vehicle on the roads and highways of this state, the insurance company or insurer shall upon payment of the claim settlement submit the certificate of title to the division.
(A) The division shall, without further inspection, issue a title branded "cosmetic total loss" to the insured or claimant owner if the insured or claimant owner wishes to retain possession of the vehicle, in lieu of a "salvage certificate." A fee of five dollars shall be charged for each "cosmetic total loss" title issued. The terms "cosmetically damaged" and "cosmetic total loss" do not include any vehicle which has been damaged by flood or fire. The designation "cosmetic total loss" on a title cannot be changed.
(B) If the insured or claimant owner elects not to take possession of the vehicle and the insurance company or insurer retains possession, the division shall issue a cosmetic total loss salvage certificate to the insurance company or insurer. The division shall charge a fee of fifteen dollars for each cosmetic total loss salvage certificate issued. The division shall, upon surrender of the cosmetic total loss salvage certificate issued under the provisions of this paragraph, and payment of the five percent privilege tax on the fair market value of the vehicle as determined by the commissioner, issue a title branded "cosmetic total loss" without further inspection.
(3) If the insurance company or insurer determines that the damage to a totaled vehicle renders it nonrepairable, incapable of safe operation for use on roads and highways and which has no resale value except as a source of parts or scrap, the insurance company or vehicle owner shall request that the division issue a nonrepairable motor vehicle certificate in lieu of a salvage certificate. The division shall issue a nonrepairable motor vehicle certificate without charge.
(b) Any owner, who scraps, compresses, dismantles or destroys a vehicle for which a certificate of title, nonrepairable motor vehicle certificate or salvage certificate has been issued, shall, within twenty days, surrender the certificate of title, nonrepairable motor vehicle certificate or salvage certificate to the division for cancellation. Any person who purchases or acquires a vehicle as salvage or scrap, to be dismantled, compressed or destroyed, shall within twenty days surrender the certificate to the division. Should a vehicle less than eight years old be determined to be a complete loss as a result of fire, flood or a basket, a photograph of the vehicle shall accompany the surrendered certificate: Provided, That the term "basket" means a vehicle which has been damaged more than seventy-five percent of the retail price as described in the national automobile dealers association official used car guide. If the vehicle is to be reconstructed, the owner must obtain a salvage certificate and comply with the provisions of subsection (c) of this section.
(c) If the motor vehicle is a "reconstructed vehicle" as defined in section one, article one of this chapter, it may not be titled or registered for operation until it has been inspected by an official state inspection station and by a representative of the division of motor vehicles who has been designated by the commissioner as an investigator. Following an approved inspection, an application for a new certificate of title may be submitted to the division; however, the applicant shall be required to retain all receipts for component parts, equipment and materials used in the reconstruction. The salvage certificate must also be surrendered to the division before a certificate of title may be issued.
(d) The owner or title holder of any motor vehicle titled in this state which has previously been branded in this state or another state as "salvage," "reconstructed," "cosmetic total loss," "cosmetic total loss salvage," "flood" or "fire" or an equivalent term under another state's laws shall, upon becoming aware of the brand, apply for and receive a title from the division of motor vehicles on which the brand "reconstructed," "salvage," "cosmetic total loss" "cosmetic total loss salvage," "flood" or "fire" is shown. A fee of five dollars will be charged for each title so issued.
(e) If application is made for title to a motor vehicle, the title to which has previously been branded "reconstructed," "salvage," "cosmetic total loss," cosmetic total loss salvage," "flood" or "fire" by the division of motor vehicles under this section and said application is accompanied by a title from another state which does not carry the brand, the division shall, before issuing the title, affix the brand "reconstructed," "cosmetic total loss," "cosmetic total loss salvage," "flood" or "fire" to the title. The privilege tax paid on a motor vehicle titled as "reconstructed" under the provisions of this subsection, "cosmetic total loss," "flood" or "fire" under the provisions of this section shall be based on fifty percent of the loan value as described in the national automobile dealers association official used car guide. fair market value of the vehicle as determined by the commissioner.
(f) The division shall charge a fee of fifteen dollars for the issuance of each salvage certificate or cosmetic total loss salvage certificate but shall not require the payment of the five percent privilege tax. However, upon application for a certificate of title for a reconstructed, cosmetic total loss, flood or fire damaged vehicle, the division shall collect the five percent privilege tax on the fair market value of the vehicle as determined by the commissioner unless the applicant is otherwise exempt from the payment of such privilege tax. A wrecker/dismantler/rebuilder is exempt from the five percent privilege tax upon titling a reconstructed vehicle. The division shall collect a fee of thirty-five dollars per vehicle for inspections of reconstructed vehicles. These fees shall be deposited in a special fund created in the state treasurer's office and may be expended by the division to carry out the provisions of this article. Licensed wreckers/dismantlers/rebuilders may charge a fee not to exceed twenty-five dollars for all vehicles owned by private rebuilders which are inspected at the place of business of a wrecker/dismantler/rebuilder.
(g) A certificate of title issued by the division for a reconstructed vehicle shall contain markings in bold print on the face of the title that it is for a reconstructed, flood or fire damaged vehicle.
Any person who violates the provisions of this section shall be guilty of a misdemeanor and, upon conviction thereof, shall be fined not less than five hundred dollars nor more than one thousand dollars, or imprisoned in the county jail for not more than one year, or both fined and imprisoned.




NOTE: The purpose of this bill is to provide a mechanism for an insured with a vehicle which is totaled solely due to cosmetic damage to elect to keep the vehicle on a "cosmetic total loss" title.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.