An agency wants to provide a driving history report to a commercial insured for one of their drivers. Is this an acceptable practice?
An agency is providing a driving history report (MVR) to a commercial insured for one of their drivers.
Q: "Do you have a standard release form for the driver to sign before we release the MVR to the employer?"
A: “Depending on what you're doing, how and why, you might want to reconsider this practice. The law governing accessing an MVR for insurance purposes is different from the law governing providing such information to an employer—not to mention, attorneys should draft “releases.” You may effectively be operating as a consumer reporting agency and, if so, are subject to much more stringent federal laws with significant penalties for violations.
The Big ‘I’ Virtual University (VU) offers two articles on this topic:
The first article explains the following:
‘An insurance agency that pulls an MVR in conjunction with "the underwriting of insurance," as prescribed in the FCRA, Section 604, does not need written permission. Therefore, when the commercial insured/employer sends a request to the agency to pull the MVR on a new employee in conjunction with adding the employee as a driver under the Business Auto Policy, the agency can do so without the written permission of the new employee.
In addition, to inform a commercial insured that a new driver does or does not qualify as a driver for underwriting purposes seems to be a part of "the underwriting of insurance."
However, most experts believe that if the agency shares the specific contents of an MVR with the employer, via fax or phone, the agency is no longer "underwriting insurance," but is now acting as a "consumer reporting agency," and must follow all the steps and procedures required under the FCRA.’
You can find more information in the legal resources area of the Big “I” website. Check out the following article: ‘Fair Credit Reporting Act, the Fair and Accurate Credit Transactions Act, and the Drivers Privacy Protection Act.’
Finally, you may also have state laws that govern what you are doing. To make sure your agency’s practices are in legal compliance with all laws, you might want to consult with a local attorney competent in this area.
Bill Wilson is director of the Big “I” Virtual University.
This question was originally submitted by an agent through the VU’s Ask an Expert Service. Answers to other coverage questions are available on the VU website. If you need help accessing the website, email logon@iiaba.net to request login information.
