KentuckyHB 3902025 Regular SessionHouseWALLET

AN ACT relating to motor vehicle insurance.

Sponsored By: Michael Meredith (Republican)

Signed by Governor

County ClerksFeesInsurance, Motor VehicleMotor VehiclesState AgenciesTransportationAdministrative Regulations and ProceedingsCircuit ClerksAdvisory Boards, Commissions, and CommitteesLocal Mandate

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Bill Overview

Analyzed Economic Effects

11 provisions identified: 3 benefits, 1 costs, 7 mixed.

Drivers face insurance checks for registration

Clerks cannot complete covered personal-vehicle transactions unless the online system shows insurance or the applicant supplies allowed proof. This covers registration, renewal, transfers, replacement plates or papers, duplicates, and temporary tags. Allowed proof includes a paper or electronic insurance card that took effect no more than seven days before application. Owners serving in the Armed Forces outside Kentucky can use an affidavit from their base's provost marshal. Transactions involving licensed Kentucky dealers are excluded. Buyers outside licensed-dealer transactions must show required insurance before registration transfers, using the method set by insurance department rules.

Missing insurance records risk registration and fees

The department must immediately notify owners about reported commercial insurance cancellations or nonrenewals and missing coverage records. Before January 1, 2027, missing personal-vehicle records trigger notice after two consecutive reporting months. Beginning then, the trigger is seven consecutive days for personal vehicles and commercial vehicles whose insurers report online. Registration avoids revocation if proof is provided, or the system shows coverage, within 14 days after insurance became invalid. Proof can be paper or electronic, though officials may require electronic submission of electronic proof. A revoked registration carries a $20 revocation-related fee; restoring it requires insurance proof and a separate $40 reinstatement fee. The issuing clerk keeps $20 of the reinstatement fee, and the state's $20 share supports the verification system.

Vehicle owners gain insurance record privacy

State insurance-status records are exempt from Kentucky's open-records law. The department must limit access to authorized people and generally cannot share, sell, or release the records. Exceptions include uses allowed by state law and specific individual requests allowed under federal driver privacy law. Each knowing, unauthorized release or disclosure is a Class A misdemeanor.

Vehicle buyers avoid sellers' unrelated tax debts

Someone other than the recorded owner applying to transfer registration may pay overdue vehicle property taxes on that vehicle. The clerk cannot require that applicant to pay the seller's overdue taxes on other vehicles to complete registration.

Kentucky creates online vehicle insurance checks

Kentucky creates an online system to check required vehicle insurance, available to insurers by October 1, 2026. Authorized users, including clerks, courts, and police, gain access by January 1, 2027. The department must issue rules and a detailed guide by January 1, 2026. Records must support matching across several fields to reduce errors and stay in the system for 6 to 12 months. An advisory committee includes four insurer representatives, county clerks, and insurance officials, with the vehicle regulation commissioner as nonvoting chair. Initial insurer appointments are due July 1, 2025; committee meetings and communications are exempt from open-meeting rules.

Lost plates cancel registrations; penalties broaden

When a Kentucky plate is reported lost, the Transportation Cabinet must immediately cancel the registration linked to it. The Cabinet must also report the cancellation to Kentucky State Police. The law broadens the registration penalty rule to cover violations of KRS 186.180(1) through (4), rather than only (4)(a). The supplied provisions do not state the penalty amounts.

Drivers can carry electronic insurance cards

Beginning January 1, 2027, insurers can provide insurance cards on paper or electronically; commercial cards must identify commercial or fleet coverage. After insuring a newly acquired vehicle or changing insurers, owners must keep the card or a device to download it in the vehicle. Owners must show it to police on request for seven days for personal vehicles and commercial vehicles whose insurers report online. Other commercial vehicles have a 45-day period. Officers with system access can use the system or card as evidence for personal vehicles and reporting commercial vehicles. If the vehicle is missing online, an officer may accept a card effective within the past seven days.

Drivers pay registration and replacement fees

The registration service fee is $6, or $9 when registration lasts more than 12 months, plus a mandatory $3 charge. That $3 splits equally among insurance-verification technology, clerk technology, and annual clerk support for counties with fewer than 20,000 residents. For vehicles or towed units with a declared gross weight rating of at least 44,001 pounds, $30 of the fee goes to the vehicle's county. Covered duplicate documents or plates cost $3 plus a $3 clerk service fee and require insurance proof, with a dealer exception. After a county move, owners can obtain a receipt and plate showing their new county for $5 by surrendering the old ones and showing insurance. The clerk keeps $3 of that move fee, and the state receives $2.

Temporary tags help drivers awaiting title

County clerks may issue 60-day temporary tags for vehicles that need Kentucky title and registration but do not yet have them. Owners must submit a completed title and registration application and can drive in Kentucky while gathering remaining documents. Dealer-issued temporary tags last 60 days and cost $2, with $1 kept by the clerk. Clerks may also issue emergency tags lasting 24 hours to seven days for titled and registered vehicles. Clerks may require insurance proof for those emergency tags.

Optional registration donations support child care

Applicants can choose to donate $1 when getting or renewing vehicle registration, and they can refuse. No more than one $1 donation is allowed per issuance or renewal. Clerks may keep 5%; the rest goes to the Cabinet for Health and Family Services for child care subsidy administration. The Cabinet can also use the money to help working families whose income exceeds state child care assistance limits.

Insurers face new reporting with legal protections

Beginning January 1, 2027, new electronic reporting replaces the old personal-vehicle reporting requirement. Insurers must send vehicle identification numbers, policyholder names, and other required coverage details. Commercial insurers can opt into the system instead of sending separate cancellation and nonrenewal reports. Those using separate reports must submit them within one calendar week after each accounting month ends. An exception covers certain unpaid renewals after policies lasting at least six months. Insurers may use vendors, and the department may offer another reporting method for insurers with 1,000 or fewer relevant policies. Insurers and authorized employees receive protection from certain civil and administrative claims for good-faith reporting, even when data is wrong or incomplete.

Sponsors & Cosponsors

Sponsor

Michael Meredith
Republican • House

Cosponsors

Erika Hancock
Democrat • House
Michael Sarge Pollock
Republican • House

Roll Call Votes

All Roll Calls

Yes: 228 • No: 0

Senate vote • 3/13/2025

passed

Yes: 96 • No: 0

Senate vote • 3/11/2025

3rd reading, passed

Yes: 37 • No: 0

House vote • 2/25/2025