Request By:
The Honorable Archie N. Romines, Sr.
State Representative
Twenty-seventh Legislative District
13312 Tennis Boulevard
Valley Station, Kentucky 40272
Opinion
Opinion By: Robert F. Stephens, Attorney General; Joseph R. Johnson, Assistant Attorney General
This letter is in response to your request for an opinion of this Office regarding the constitutionality of KRS 304.39-085 which is Kentucky's Liability Insurance Sticker or Emblem Law. Before examining the Liability Insurance Sticker Law itself, it is first necessary to refer to the basis for the law found in KRS 304.39-080(5).
KRS 304.39-080(5) provides as follows:
Except for entities described in subsections (3) [motor vehicles belonging to the Commonwealth, its political subdivisions, municipal corporations and public agencies] and (4) [motor vehicles belonging to the United States Government and its public agencies and any other state, its political subdivisions, municipal corporations and public agencies] , every owner of a motor vehicle registered in this Commonwealth by him or with his permission, shall continuously provide with respect to the motor vehicle . . . by a contract of insurance or by qualifying as a self-insurer . . . security for payment of tort liabilities, arising from maintenance or use of the motor vehicle.
The case of
Fann v. McGuffey, Ky. 534 S.W.2d 770 (1975) upheld the validity and constitutionality of Kentucky's Basic Reparation Benefits [No-Fault] Act. However, the Court in its opinion did not address the question of the constitutionality of the mandatory liability insurance requirement found in the abovequoted language. Therefore, it is necessary to review the history of Kentucky's mandatory liability insurance requirement.
KRS 304.39-080(5), enacted in 1974, replaced Kentucky's old Motor Vehicle Financial Responsibility Statute previously found in KRS 187.330 which is now repealed. KRS 187.330 had required that subsequent to any motor vehicle accident in which any person is injured or killed or in which property damage exceeded $200.00, the operator or owner or both must deposit security in a sum sufficient to satisfy any judgment for damages resulting from the accident as may be recovered against the operator or owner. The amount of such security was determined by the Department of Transportation. Failure to post this required security resulted in the suspension of the license of each operator and the registration of each owner.
However, the following classes of operators or owners were not required to post the above security:
1. The operator or owner who had in effect an automobile liability insurance policy covering the motor vehicle at the time of the accident.
2. An operator who had in effect at the time of the accident an automobile liability insurance policy or bond with respect to his operation of motor vehicles not owned by him.
3. An operator or owner who was covered by any other form of liability insurance or bond at the time of the accident.
4. An operator or owner who qualified as a self-insurer.
If the accident resulted in the bodily injury or death of one person, the above liability insurance policy or bond was required to be not less than $10,000.00 for bodily injury or death. If the accident resulted in the deaths of more than one person, the liability insurance policy or bond could not be less than $20,000.00 for bodily injury or death. In addition, the liability insurance policy or bond must provide at least $5,000.00 liability coverage for property damage.
Therefore, under the old Motor Vehicle Financial Responsibility Statute [KRS 187.330], any owner or operator who did not have in effect at the time of the accident, a liability insurance policy or bond in the above amounts was required to make the security deposit. The security deposit requirement was a condition for the operator to retain his licensing privileges and the owner to retain his registration privileges.
The constitutionality of KRS 187.330 was in issue in the case of
Ballow v. Reeves, Ky. 238 S.W.2d 141 (1951). In upholding the constitutionality of the statute, the Kentucky Court of Appeals stated as follows:
The right to operate a motor vehicle is a privilege, subject to reasonable regulation by the state in the exercise of its police power. . . . It has generally been recognized that financial responsibility laws constitute both reasonable regulations of the public highways, and proper measures to protect the public safety . . . .
It seems clear the legislature may require, as a condition to the right of operating a motor vehicle, the procurement of insurance or the furnishing of other proof of financial responsibility . . . .
. . . Since permission to operate a motor vehicle on the highways of this Commonwealth is not a right but a privilege, suspending the privilege for failure to comply with reasonable regulations is not a denial of due process . . . .
Kentucky's old Motor Vehicle Financial Responsibility Statute [KRS 187.330] remained in full force and effect until the mandatory liability insurance provision was included in Kentucky's Motor Vehicle Reparations Act, otherwise known as the No-Fault Statute, in 1974. [KRS 304, Subtitle 39]. The most fundamental difference in the old law and the new law is that under the Motor Vehicle Financial Responsibility Law, the owner or operator was permitted to have one accident before being required to show evidence of financial responsibility. Under the new law [KRS 304.39-080(5)], the owner of a motor vehicle is required to maintain minimum tort liability insurance as a condition of maintenance and use of the vehicle on the streets, roadways and highways of this Commonwealth. The required minimum tort liability is $10,000 for bodily injuries for each person, arising out of the same accident, $20,000 for all bodily injuries arising out of the same accident and $5,000 for property damage arising out of the same accident. [KRS 304.39-110(1)].
Based on the Court's ruling and language in
Ballow v. Reeves, supra, it is the opinion of this Office that the requirement that the owner of a motor vehicle must maintain liability insurance coverage for minimum tort liability is a valid exercise of the state's police power. KRS 304.39-080(5) is constitutional and valid in all respects.
KRS 304.99-060 is the penalty section which applies to any owner who fails to maintain the required automobile liability insurance coverage on his vehicle and display the required sticker or emblem on his vehicle. However, KRS 304.99-060(5) provides that any person who is cited for violation of the act need only demonstrate due proof of coverage to the court in order to be acquitted. Although an owner of a motor vehicle may be cited for failure to maintain the required liability insurance and display the required sticker or emblem on his automobile, he will be acquitted upon his demonstration to the court that he maintains liability insurance coverage on his motor vehicle.
The Kentucky Liability Insurance Sticker or Emblem law is part and parcel of the mandatory automobile Liability Insurance Law. Because we have determined that the mandatory Automobile Liability Insurance Law is constitutionally valid under the Ballow v. Reeves ruling, it must follow that the Liability Insurance Sticker Or Emblem Law is likewise constitutionally valid as a proper exercise of the state's police power.