2005 Regular Session
To: Insurance; Finance
By: Senator(s) Dawkins, Williamson
AN ACT TO CREATE THE MILE-BASED AUTO INSURANCE INCENTIVE ACT; TO PROVIDE TAX INCENTIVES FOR AUTOMOBILE INSURERS WHICH OFFER CERTAIN MILE-BASED OR TIME-BASED RATING PLANS; TO ESTABLISH THE AMOUNT OF THE INCENTIVES; AND FOR RELATED PURPOSES.
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MISSISSIPPI:
SECTION 1. This act shall be known and may be cited as the "Mile-Based Auto Insurance Incentive Act."
SECTION 2. As used in this act:
(a) "Insurer" means an insurance company, interinsurance exchange, mutual, capital stock company, fraternal benefit society, local mutual aid association, county mutual reciprocal, association, Lloyd's plan, or other entity writing motor vehicle insurance in this state.
(b) "Mile-based rating plan" means a rating plan for which a unit of exposure is one (1) mile traveled by the insured motor vehicle.
(c) "State premium tax liability" means any liability incurred by an insurance company under the provisions of Sections 27-15-103 through 27-15-119 and Sections 27-15-121 through 27-15-127, or in the case of the repeal or reduction by the State of the tax imposed by Sections 27-15-103 through 27-15-119 and Sections 27-15-121 through 27-15-127, any other tax imposed upon an insurance company by this state.
(d) "Time-based rating plan" means a rating plan for which a unit of exposure is one (1) minute or one (1) hour.
(e) "Traditional rating plan" means the current standard rating plan offered by insurers, whereby rates are calculated irrelevant of mileage or time and usually charged on a six-month or one-year basis.
(f) "Unit of exposure" means a unit that measures the loss exposure assumed by an insurer, the total of such units of which is multiplied by the policy rate, or rates, to produce the policy premium.
SECTION 3. (1) An insurer shall be allowed a credit against its state premium tax liability that is otherwise due under state law for providing motor vehicle insurance policies in this state that are at least seventy percent (70%) based on a mile-based rating plan or a time-based rating plan.
(2) The amount of the credit shall equal One Hundred Dollars ($100.00) for each vehicle insured under a policy described in subsection (1) of this section that is issued in this state during the tax year, not to exceed Three Hundred Dollars ($300.00) for each policy.
(3) The total amount of credit allowed under this section in a tax year may not exceed the tax liability of the insurer and may not be carried forward to another tax year.
(4) The insurer may require a person purchasing coverage to use the same rating plan for all vehicles covered under the person's motor vehicle insurance policy.
(5) The credit shall be a one-time credit only and may not be claimed with respect to a vehicle or policy for which a credit was allowed in a previous tax year.
(6) The credit allowed under this section may be given for motor vehicle insurance policies issued in the State of Mississippi from and after January 1, 2005.
SECTION 4. This act shall stand repealed from and after July 1, 2010.
SECTION 5. This act shall take effect and be in force from and after its passage.